Good morning, Your Honors. May it please the court. My name is David Goldsmith. I'm here on behalf of the plaintiffs and the alleged class in this securities class action. Your Honors, this appeal arises on denover review following the dismissal of our complaint on falsity and CENTR grounds. Those are broadly the two issues that are before you this morning. Setting the stage, I'd like to mention that it's really indisputed in this case, that in the Cupid 1 clinical trial, the patients who received the Myda Carr heart failure treatment started off a lot more healthy, in fact on 7 of the 8 measures of health than the patients who received the placebo. Also undisputed, Your Honors is the fact that these, what they call patient baseline imbalances, created a serious and fundamental question as to whether the results of Cupid 1 on efficacy or the effectiveness of the Myda Carr were reliable. Also undisputed, Your Honors is the fact that Seladon sought to validate these efficacy results by running a sensitivity analysis post-hoc. So after all the data was unblinded. Now we allege, Your Honors, with specific<|hu|> questions. So the next thing I was going to say, and I will answer your question in detail, Dr. Schwattford, what we allege with specificities that the methodology for the sensitivity analysis was arbitrary and result of the process. But it was disclosed in that supplement, and I'm looking at it right here, everything you complain about in the complaint and in your brief, telling me if I'm wrong, because this is my assumption, and this is what guides my preliminary view. Everything that you're complaining about in terms of the methodology, they explained exactly what they did. Now you might disagree with it, you might say that well, competent scientists certainly wouldn't think that that rendered the initial results reliable nonetheless, but they told everyone the analysis they went through. And if people thought that that was junk science, they were perfectly entitled to read that, make their own judgment and not bother investing in the company. But nothing was withheld, so tell me if I'm missing something there. Well, a couple things on that Judge Schwattford
. So first of all, the matters that you're talking about for public disclosure were disclosed exactly once in a medical journal, two and a half years before the start of the class period, three and a half years before the readout of the cupid to results. It was not disclosed in any document that was directed to investors. It was not disclosed to investors, and it was not disclosed at any point in time that was relevant to the class. In fact, it was disclosed at a time before Selon even became the public company. So what disclosures to investors were made that in which this should have been a part of that? So the disclosure to investors, the findings of the SEC, appeared to be very, very general. And we have a lot more specific information in the article and the supplement that really get into the weeds. So where is it that they fell down? So there's two things, Your Honor. The supplement, what the supplement did not include, and just to complete my answer to Judge Schwattford, is any kind of validation or explanation of the methodology? Yes, they said, okay, we took out the four placebo patients that we determined were highest risk or sickest. But they didn't explain why. They didn't explain why that was a reasonable methodology and how that showed that the efficacy results remained correct or remained reliable. And that's important because they did that with other aspects of the Cupid I design. So for example, with the p-value being 0.2 or 20%, which is a very high threshold for statistical significance. They took care in the Cupid I resolved article, the article itself, to explain why they did it that way. But they omitted in the, and this is not an actionable omission because it was before the class period. But they omitted in the data supplement any additional explanation or validation of why the sensitivity analysis was correct or why it was supportable. And they omitted, this is during the class period, they omitted any mention of the baseline imbalances or of the sensitivity analysis at all. But somebody looking at that, somebody who was knowledgeable looking at that, at the fact that you took people out of the study after you unblinded it, surely would have reasonable questions about the methodology
. Correct your honor, but that's not the question before the panel. The question before the panel is, what would a reasonable investor do with that information? And a reasonable investor I would submit would not know what to do with that information. I mean, all they said in the article was, we saw some patient imbalances on certain of the criteria namely, V.O. Maxson, so on and so forth. I mean, I had to hire an expert to explain this to me, right? And to make the allegations in my complaint. No reasonable investor would be able to make heads or tails of any of this. You just had this very complicated chart. And I'm looking at, you know, page ER-ER-36 with this, you know, very complicated set of information. I mean, I'm not saying it's wrong for purposes of the medical journey. That's true. Then how do you, since the statements that an average investor, someone is not very smart like me in this, would be able to look at, would only look for words like encouraging, you know, good result onto next phase. But why would that be, why would that be false? So, your honor, why is that misleading if the folks at Seladon believed that the results were encouraging? That wouldn't necessarily be false. Okay, so I believe your honor's question focuses on certain statements by Dr. Zeebo, the CEO in press releases. Right. Those are the ones that an average investor, somebody who didn't have technical understanding of how scientific studies should be conducted. And what the, what the flaws in the study might be
. If you're looking for your average investor, those statements are so general that it's hard to say that Seladon didn't believe them. They were putting millions of dollars into the next, into the next study. So, okay. So the statements that your honor is talking about are the, are the press releases with words like encouraging and validating the results and so on in the press release. Just want to make sure I'm on the same page with your honor. Here's the thing about that. So, so, so Seladon argued that those were, were puffery. My submission is that they're not puffery because they're based on on criteria, they're based on hard facts, they're based on, they're not just corporate boosterism like we're going to have a great year next year or on to the next, you know, great initiative. They're based on very precise albeit, we'll edge unreliable results from a clinical trial. So, I would suggest that those are not puffer at all. When she says, look at these encouraging clinical results, that's not puffery. She's talking about specific clinical results that you can look up as, as Judge Watford said, you know, as Judge Watford said, anyone could look this up if they wanted to. Maybe they wouldn't understand it, but they could look it up. Right. I think I can hire an expert. Right. But I think what Judge Bivy is getting at is that, so fine, she's expressed an opinion. And if you wanted to try to prove that she didn't genuinely hold that opinion, that would be one thing
. You have presented not one fact that suggests in any way that she did not sincerely believe that the sensitivity analysis that she did not was standing the flaws in the methodology you alleged. You have led one fact that suggests that she didn't really believe that the analysis they did, in fact, did validate the results. Oh, I would disagree with that. You're wrong. Okay. What do you got on that front? Okay. So, I would suggest that our complaint has sufficient facts under the PSLRA standards to allege that very thing. What do you got? Okay. So, so, first of all, the sensitivity analysis is suspicious for a number of reasons. First of all, it doesn't satisfy its own methodology at all. That's very strange. That should have been a red flag to don't mean that. I'm talking about, okay. So, subjectively, that she did not sincerely believe that the sensitivity analysis, in fact, validated the results. I think what you would need is some kind of, you know, back channel communication. This is really bad, but let's keep the, you know, the party line out there, even though we all know that this completely undermines what we've done. You need something pretty damning like that, wouldn't you? To say that she is subjectively in her head, she did not genuinely believe that the results were still valid. Well, I don't think the standard is whether I have some kind of, you know, smoking gun email and in Tabletell lab says nothing of the sort, it says the opposite
. I'm saying, what else would you be able to point to? All you've said is that any competent scientist in this field would have to know that this was just junk. That's what you've basically said. No, you're wrong. Okay. Well, what else? So, first of all, there's no disclosure of the, of, there's no disclosure of the baseline imbalances or the sensitivity analysis any time during the class period at all. I think that is, I think that is suspicious, especially you're not speaking to what is in Dr. Zibo's mind. You have, I'm, I, maybe you want to move on to something else, but the question I put to you, you have not come up with one fact that says she in her own mind did not genuinely believe that the sensitivity analysis validated the results. So what do you have on that front before you try to move on to something else? So let's look at, let's look at, let's look at one thing. So, so Dr. Zibo's name is on both documents. It's on the QPID1 article, which your honor remind the room is was disclosed back in 2011. It's also on the data supplement, which those documents go together. Dr. Zibo embraces the, the article which has the, the, the results and proudly touts the, the results. But apparently she doesn't, you know, our submission is that we've, we have alleged facts that the, that the methodology for the sensitivity analysis is, is wrong. Those, those facts have to be taken as true. There are no facts in the record interestingly that show otherwise
. But aren't you suggesting that given Dr. Zibo's experience, given that this is a small company, given that she, this is her field, she's got a PhD in this stuff that you're asking that there is a reasonable inference that she knew. Is, is, is, do you have anything beyond that? I don't, and I think that's all we, I don't see this as an opinion. It's not an opinion question, your honor. It's a question of knowledge of it. It's a, it's a, it's a, it's a, it's a question of knowledge or the deliberate reckless. It's not a question of, of opinion under under omni-care. And I think, I think, I think, you know, respectfully, I think maybe the, the standards may be getting a bit muddled. So we, we've alleged with specific facts that are, that are backed up by an expert in the field that this methodology was all way. And what's interesting here and what takes us out of the regal rubric is that there is nothing in the record, either from the company itself or from council in the submissions below or even in this court that goes against that. There's no explanation saying no plaintiffs, you don't know what you're talking about. This is why we did it this way and this is why the, the sensitivity analysis is total reasonable. There's nothing on that. It's almost like, it's almost like the sensitivity analysis is, it almost admitted as, as being indefensible, which is, which I think is remarkable. And that's one of the things incident, you know, that takes us out of the regal rubric, which is an important matter before the panel as well. So if, if, if one agrees, if the panel agrees that we've sufficiently alleged that the, that the, that the methodology is no good, her name is on the document. So she has to stand by the document, right? And then under Howard V. Everick's, a panel of this court held that if you sign an SEC filing, you're responsible for what's in the filing
. Now there's no question that she stands behind the, the cupid one article. So that means she's got to stand behind the data supplement too. I mean, it's almost like the defense are arguing that, okay, well she stands behind the 10k, but she doesn't, you know, necessarily understand the exhibits to the 10k because that was an online document that didn't get sent out to the shareholders. So I don't think that's really going to work. So she's got to be responsible for both. That's the essence of the argument here. Also, as, as Judge Hernandez said, we have all of the indisha that have been accepted by courts multiple times in other cases of this variety. Tiny company, 35 employees. This was their only product. I mean, this was her baby to use a colloquialism. The entire purpose of the company was to get this my to car thing on the market. She stepped, she stood to lose a lot of money. She had every motive to get this, to get this my to car thing moving along and to advance it to cupid to even if the, and to paper over, we allege the unreliable results of, of cupid one. And, and our stock sale allegations support that as well. We would, we would submit. You can't see about 30 seconds left. Would you like to reserve your time? Yes. Thank you, Your Honor
. Good morning. May please the court. Koji Fukumura for the defendants. I'm going to pick up, we'll sign here. If this is a fraud case, they're accusing my client of intending to deceive the investing public and, and Judge Watford's line of questioning. And it's really, you don't need to go beyond, because there's just no well-plot allegation in this complaint. And I'll, I'll describe why. So, to adequately allege science, there are plenty of must plead a highly unreasonable omission involving not merely simple or even inexcusable negligence, but an extreme departure from the standard of care. So think about that. There are statements that they say are misleading by Waible Mission because she failed to include in them some information in the study about their observation of a baseline balance and sensitivity analyses that they ran. But the only way that becomes actionable is to Judge Watford's point. It was a highly unreasonable omission that she knew that these sensitivity analyses in their words were a sham. And I'm going to tell you why that's not there. She's not alone in this study. The study had 27 principal investigators. The study included some of the most significant cardiologists and cardiovascular surgeons in the country. The chair of the study, Dr. Merrill Jessup is a former president of the American Heart Association
. Dr. Thomas Capola is the chief of cardiovascular surgery at the University of Pennsylvania. Dr. Daniel Pauli, the chief of cardiology at the University of Florida. These are the authors of the study. These are the people who ran the sensitivity analyses. These are people to whom they say, no, had no financial allegiance to the company. Now they've identified a few of the authors and principal investigators like Dr. Greenberg who is the chief of cardiology. He's a former president of the Heart Failure Society of America and a director of the Advanced Heart Failure Treatment Program at UCSD. They say, well, you know, he has a stipend because he's on the advisory board. And without more, they say that, you know, he must be in an end. So in order to believe the plan of theory that the sensitivity analysis that was run not to change the study outcome, but just to understand whether or not the baseline imbalances that they observed were a problem. Now, let's just try to understand it. They're not running a new statistical analysis to get to a new endpoint. The study had an endpoint. They met every single one. They saw the baseline imbalances and said, okay, well, we should probably run some analyses on this and the baseline imbalances run some sensitivity analyses
. They did to judge Wattper's point. They disclosed it in an online supplement. And in the plan. Is there a plan where that disclosure may not be enough? I mean, I know you're arguing that it was, but is it ever not enough because the disclosure was disclosed in some obscure publication that nobody's ever going to read anyways? And you can't hide behind it and say, well, we disclosed we're good. And I think that's what the planists are arguing. It's a great question. The problem for them is that every single person in the industry. So we're going to, I'm going to talk about specific other actors. Every person in the industry knows, including the analysts who make the market, including the specialists on the floor, the trade, they know where to go to get this information. And it's called clinical trials.gov. All the information for clinical trials are in clinical trials.gov. If you Google Mydakar clinical trial, the very first hit is Cupid 1. If you click into that scroll to the bottom, it'll say publication of results. Click on that. You get right to the American Heart Association peer review journal circulation online. You can just click on the supplementary materials and out it comes. It takes 20 seconds. And the reason why this is important is they sort of say that we hit it in the ether. It's literally in the place that everyone would go first. I have a bookmarked in my phone. We do a lot of life sciences work. If I hear about a clinical trial, that's where I go. And the idea that we would have to, and the conclusion, by the way, the sensitivity analysis that they ran was that it could not explain these baseline imbalances could not explain the very positive results in each of the efficacy analyses that were conducted. And the additional analyses time to recurrent events. They hit all of them. Now, he may say, well, in the sensitivity analysis, the group level analysis was no longer statistically significant. Okay, again, the point was not to run a new statistical analysis, but I will tell you that the individual analysis was still highly significant. And all the time to recurrent events analyses, which became the end point for keep it to were all highly significant. And if you like, when you go through those points individually, I'd be happy to. So in their brief, they argued that when you conduct a sensitivity analysis, the trial goes from past to fail. That's wrong. In order to the success of this trial is defined as is follows, primary end points success criteria, efficacy, and either the group level or the individual level or the outcome analysis, plus at least positive corresponding trend numeric superiority in all other analyses, no clinical worsening significant worsening of any of the end points. Even when you take out the four patients, you meet it for individual, you meet it for outcome. After the four patients were taken on, how many were left? Well, so it's a great point
. It takes 20 seconds. And the reason why this is important is they sort of say that we hit it in the ether. It's literally in the place that everyone would go first. I have a bookmarked in my phone. We do a lot of life sciences work. If I hear about a clinical trial, that's where I go. And the idea that we would have to, and the conclusion, by the way, the sensitivity analysis that they ran was that it could not explain these baseline imbalances could not explain the very positive results in each of the efficacy analyses that were conducted. And the additional analyses time to recurrent events. They hit all of them. Now, he may say, well, in the sensitivity analysis, the group level analysis was no longer statistically significant. Okay, again, the point was not to run a new statistical analysis, but I will tell you that the individual analysis was still highly significant. And all the time to recurrent events analyses, which became the end point for keep it to were all highly significant. And if you like, when you go through those points individually, I'd be happy to. So in their brief, they argued that when you conduct a sensitivity analysis, the trial goes from past to fail. That's wrong. In order to the success of this trial is defined as is follows, primary end points success criteria, efficacy, and either the group level or the individual level or the outcome analysis, plus at least positive corresponding trend numeric superiority in all other analyses, no clinical worsening significant worsening of any of the end points. Even when you take out the four patients, you meet it for individual, you meet it for outcome. After the four patients were taken on, how many were left? Well, so it's a great point. There is a limitation to this study, which is it's very small size, which is why 30 and 39 total. There is 39 in the phase two a portion of this. And the reason the 39 are divided into I think four different classes. There's placebo head 14, 14, 8, 8. That gives you that gives you less than 10 in each group. Yes. So you took out almost half of those from one of the groups. Right. And in what the study on. I'm sorry. I made it deadly than the placebo group. 10. Yeah. I mean, you took four out of the placebo group. Correct. And the four sickest patients. Right. And that would have left you with six
. There is a limitation to this study, which is it's very small size, which is why 30 and 39 total. There is 39 in the phase two a portion of this. And the reason the 39 are divided into I think four different classes. There's placebo head 14, 14, 8, 8. That gives you that gives you less than 10 in each group. Yes. So you took out almost half of those from one of the groups. Right. And in what the study on. I'm sorry. I made it deadly than the placebo group. 10. Yeah. I mean, you took four out of the placebo group. Correct. And the four sickest patients. Right. And that would have left you with six. 10. There were 14 in the placebo group. It was larger than the other groups. Yes. Yeah. And what the study other said is that highly skews in favor of the placebo group. But nevertheless, we're not again, we're not running a new statistical analysis. The only thing we have a result. Cupid won met all of its efficacy endpoints, but we're observing that there is an imbalance here. The team placebo and high dose. So let's just run some analyses. And who ran it? The people I've described. And I didn't even tell you about the other principle investigators, which include the directors or chairs of the cardiovascular surgery or cardiology departments at the University of Chicago. At the Cleveland Clinic at the University of Iowa at Methodist Hospital. These are very significant people. And the idea that they would run a sham sensitivity analysis. And then present that to the very people, cardiologists and cardiovascular surgeons who would most likely fair it out. Fair it out as sham analysis is not reasonable
. 10. There were 14 in the placebo group. It was larger than the other groups. Yes. Yeah. And what the study other said is that highly skews in favor of the placebo group. But nevertheless, we're not again, we're not running a new statistical analysis. The only thing we have a result. Cupid won met all of its efficacy endpoints, but we're observing that there is an imbalance here. The team placebo and high dose. So let's just run some analyses. And who ran it? The people I've described. And I didn't even tell you about the other principle investigators, which include the directors or chairs of the cardiovascular surgery or cardiology departments at the University of Chicago. At the Cleveland Clinic at the University of Iowa at Methodist Hospital. These are very significant people. And the idea that they would run a sham sensitivity analysis. And then present that to the very people, cardiologists and cardiovascular surgeons who would most likely fair it out. Fair it out as sham analysis is not reasonable. Let me tell you what else is not. Can I just ask a question in terms of the what scientists in this field were saying. So this publication came out was at 2011. Right. Was there any point after that where folks in the field said, hey, like these guys are saying, this is a joke. Yeah. Was there any kind of critique like that? No, zero. The only time the balance and to be sure. Other people raised the fact of the imbalances when they initiated cover coverage right after the company went public in February of 2014. Barclays came out. Credit Suisse came out and said among other things, look, it looks very encouraging. That's their words, right. Looking at the study. Yeah, but they were basically that based on your words, were they not? Well, okay. So when we're talking about stock analysts in life sciences. I think you can, it's reasonable assume that they are these stock analysts know what they're doing in terms of life sciences. So they did their own work. They said, I mean, they may have looked only at the study results and the supplement and they came to their conclusion
. Let me tell you what else is not. Can I just ask a question in terms of the what scientists in this field were saying. So this publication came out was at 2011. Right. Was there any point after that where folks in the field said, hey, like these guys are saying, this is a joke. Yeah. Was there any kind of critique like that? No, zero. The only time the balance and to be sure. Other people raised the fact of the imbalances when they initiated cover coverage right after the company went public in February of 2014. Barclays came out. Credit Suisse came out and said among other things, look, it looks very encouraging. That's their words, right. Looking at the study. Yeah, but they were basically that based on your words, were they not? Well, okay. So when we're talking about stock analysts in life sciences. I think you can, it's reasonable assume that they are these stock analysts know what they're doing in terms of life sciences. So they did their own work. They said, I mean, they may have looked only at the study results and the supplement and they came to their conclusion. But the important fact point is not a single person in this complaint other than the plaintiff. And his unnamed biostatistician has ever said that this is a sham. This sensitivity analysis is a sham has ever said, hey, you know, before we say that we should be concerned about X, no journal article, no document, not a single confidential witness. You did have an article critical just before a cell, it announced the results of Q. But it's not critical, but I'd love to address that. What it says is it points out the baseline imbalances right that that Barclays did in others and it said it's such a small study. And if I look at some of these specific metrics, boy, I just don't think the study was powered enough. And again, time and again, it's the one, the first thing in all the disclosures, it was a small study. We're not saying at the end of Q. But one boy, this works, this brand new therapy, the first time there's ever been a gene therapy trial for cardiovascular condition. This really works. No one has said that. Dr. Savelin never said that. What she said, very clearly work. Here are the results. They met their efficacy end points. And based on this, we're going to move into phase two, or we're really phase two B
. But the important fact point is not a single person in this complaint other than the plaintiff. And his unnamed biostatistician has ever said that this is a sham. This sensitivity analysis is a sham has ever said, hey, you know, before we say that we should be concerned about X, no journal article, no document, not a single confidential witness. You did have an article critical just before a cell, it announced the results of Q. But it's not critical, but I'd love to address that. What it says is it points out the baseline imbalances right that that Barclays did in others and it said it's such a small study. And if I look at some of these specific metrics, boy, I just don't think the study was powered enough. And again, time and again, it's the one, the first thing in all the disclosures, it was a small study. We're not saying at the end of Q. But one boy, this works, this brand new therapy, the first time there's ever been a gene therapy trial for cardiovascular condition. This really works. No one has said that. Dr. Savelin never said that. What she said, very clearly work. Here are the results. They met their efficacy end points. And based on this, we're going to move into phase two, or we're really phase two B. You know who else agreed with that? So we have to look at what are the reasonable references, the common sense, influences. After the study results came out, Pfizer, Novartis, Johnson and Johnson invested tens of millions of dollars in this company. Is it reasonable to assume that they didn't go and pull the online supplement? Is it reasonable to assume that they didn't pull the study results? Of course not. We know the company was private at the time, by the way. There's no rag FD issue. They were in their meeting with management. They were there pouring over everything. That's a reasonable common sense conclusion about how the largest pharmaceutical companies in the world are going to act prior to investing tens of millions of dollars. Just on that same point, what do you know what scrutiny the FDA does before it? I can't remember the designation of those little catchwords. Breakthrough or fast track or what? But does the FDA also scrutinize this stuff before? So what the FDA's that they quoted that you just need to give us a summary before we give you fast track designation before we give you breakthrough therapy status. And this is another great example of using common sense. There's also was an end of phase two meeting. They say, oh, you only have to give a summary. Now, the only question would be did the FDA before giving these designations, which we represent more life sciences companies than any firm in the country. And I can tell you, my clients would be thrilled if they could skip phase three clinical trials. They would be thrilled if they could get more access to senior members of the FDA. Of course they looked at it. Probably had some questions
. You know who else agreed with that? So we have to look at what are the reasonable references, the common sense, influences. After the study results came out, Pfizer, Novartis, Johnson and Johnson invested tens of millions of dollars in this company. Is it reasonable to assume that they didn't go and pull the online supplement? Is it reasonable to assume that they didn't pull the study results? Of course not. We know the company was private at the time, by the way. There's no rag FD issue. They were in their meeting with management. They were there pouring over everything. That's a reasonable common sense conclusion about how the largest pharmaceutical companies in the world are going to act prior to investing tens of millions of dollars. Just on that same point, what do you know what scrutiny the FDA does before it? I can't remember the designation of those little catchwords. Breakthrough or fast track or what? But does the FDA also scrutinize this stuff before? So what the FDA's that they quoted that you just need to give us a summary before we give you fast track designation before we give you breakthrough therapy status. And this is another great example of using common sense. There's also was an end of phase two meeting. They say, oh, you only have to give a summary. Now, the only question would be did the FDA before giving these designations, which we represent more life sciences companies than any firm in the country. And I can tell you, my clients would be thrilled if they could skip phase three clinical trials. They would be thrilled if they could get more access to senior members of the FDA. Of course they looked at it. Probably had some questions. Hey, what about this? Hey, principal investigator, Dr. Jessup, what about this? And they got answers. And what was the result of those interactions on December 11th, fast track designation in the beginning of 2012, a special protocol assessment after the end of phase two meeting, allowing for the next trial. Now, why in the world, if this was a sham, if this was so obviously a fraud, why in the world would the FDA do any of that? And then for the first time ever said ER 106 granting breakthrough designation to a company for a gene therapy program. Now, why would the EMA and the European Medicines Agency say, by the way, if keep it two works, we might be able to skip phase three and go to marketing in Europe. Those reactions by these sophisticated actors by Pfizer, Novartis, J&J, MPM, Capital, which is the largest private equity firm that invests in life sciences. Is that a reasonable response to a sham? Is it reasonable to think that they didn't look at this, of course not? And so the only thing, there's this sort of mountain, right, of inferences that one could draw from the facts that they alleging the complaint that are very consistent with her belief that exactly what they said. It's a small study, 39 people, hit the ball out of the park on each one of these end points. There was a baseline imbalance. She's a biochemist, by the way, and I'm not running away from the fact that she was an author, but she was surrounded by people who are cardiologists, cardiovascular surgeons, and they together made this decision. You have to believe that they were in on it, that this was a sham, and I see my time is up. And so, and they just haven't done that. And for that reason, your honours, we respectfully request that you affirm the trial court's decision. Thank you. Thank you, Mr. Fookamora. Mr. Goldsmith? I'll allow you a minute
. Hey, what about this? Hey, principal investigator, Dr. Jessup, what about this? And they got answers. And what was the result of those interactions on December 11th, fast track designation in the beginning of 2012, a special protocol assessment after the end of phase two meeting, allowing for the next trial. Now, why in the world, if this was a sham, if this was so obviously a fraud, why in the world would the FDA do any of that? And then for the first time ever said ER 106 granting breakthrough designation to a company for a gene therapy program. Now, why would the EMA and the European Medicines Agency say, by the way, if keep it two works, we might be able to skip phase three and go to marketing in Europe. Those reactions by these sophisticated actors by Pfizer, Novartis, J&J, MPM, Capital, which is the largest private equity firm that invests in life sciences. Is that a reasonable response to a sham? Is it reasonable to think that they didn't look at this, of course not? And so the only thing, there's this sort of mountain, right, of inferences that one could draw from the facts that they alleging the complaint that are very consistent with her belief that exactly what they said. It's a small study, 39 people, hit the ball out of the park on each one of these end points. There was a baseline imbalance. She's a biochemist, by the way, and I'm not running away from the fact that she was an author, but she was surrounded by people who are cardiologists, cardiovascular surgeons, and they together made this decision. You have to believe that they were in on it, that this was a sham, and I see my time is up. And so, and they just haven't done that. And for that reason, your honours, we respectfully request that you affirm the trial court's decision. Thank you. Thank you, Mr. Fookamora. Mr. Goldsmith? I'll allow you a minute. You've consumed most of your time. Thank you. Thank you, your honours. Appreciate that. Mr. Fookamora said a whole bunch of things during his presentation. Many of the facts that he presented were outside the complaint about looking things up on the internet and so forth, things that I can't frankly speak to, but things that are just not in the record at all about his personal involvement and so forth. I think the court is more than qualified to separate that out. He says that this fraud was so obvious and a sham, it was a sham, but it wasn't so obvious. You'd have to be able to discern it. That's the whole point. That's part of the thrust of our case, that a reasonable investor, as we specifically alleged, would not have been able to recognize the issues with the sensitivity analysis. We think that the motive, you know, Council for Seladon is incredulous that this could have happened. I think it's quite clear. So one of the questions that occurred to me during your opening presentation that I didn't ask is if the folks at Seladon were aware of the sham, why do they persist in this? Why waste millions of dollars more on a test that is not likely to work in the end? And so does this depend on your proof that Dr. Sabo sold stock before she, before the second test came out? It's not that it wasn't necessarily likely to succeed when we talk about Cupid 2. It's at the risk that Cupid 2 would fail. So it was much greater than the company led on
. You've consumed most of your time. Thank you. Thank you, your honours. Appreciate that. Mr. Fookamora said a whole bunch of things during his presentation. Many of the facts that he presented were outside the complaint about looking things up on the internet and so forth, things that I can't frankly speak to, but things that are just not in the record at all about his personal involvement and so forth. I think the court is more than qualified to separate that out. He says that this fraud was so obvious and a sham, it was a sham, but it wasn't so obvious. You'd have to be able to discern it. That's the whole point. That's part of the thrust of our case, that a reasonable investor, as we specifically alleged, would not have been able to recognize the issues with the sensitivity analysis. We think that the motive, you know, Council for Seladon is incredulous that this could have happened. I think it's quite clear. So one of the questions that occurred to me during your opening presentation that I didn't ask is if the folks at Seladon were aware of the sham, why do they persist in this? Why waste millions of dollars more on a test that is not likely to work in the end? And so does this depend on your proof that Dr. Sabo sold stock before she, before the second test came out? It's not that it wasn't necessarily likely to succeed when we talk about Cupid 2. It's at the risk that Cupid 2 would fail. So it was much greater than the company led on. They could not advance my to car to Cupid 2 unless they showed success in Cupid 1. Cupid 1 was a precondition to moving or advancing my to car to Cupid 2. You had to get past the first hurdle to get past the second hurdle. And I would suggest that the thing about not having to do phase 3 was a motivation rather than a proof of innocence. They knew that if they could get to Cupid 2, then they would be able to get to the promised land and become very, very rich and successful. So when they realized that they had these tremendous imbalances, which were so tremendous when one who knows looks at the data, that they very likely drove the efficacy results of Cupid 1. It wasn't just, oh no, there's a small imbalance. This was a very severe imbalance and we alleged that that actually caused the results. We alleged that they had to paper that over with a sensitivity analysis so that they could get to Cupid 2. So the thrust of our case is that it's not that they thought Cupid 2 would fail or they knew it would fail. So they certainly wanted it to succeed, I'm sure they did. But the risk of failure was far greater than they let on. They knew that it was a huge gamble, this is our allegation, but they didn't disclose the risk adequately to the investing public, to my client and to the class that we seek to represent. That's what this case is about and that Dr. Zibo knew that that risk was far greater than what was disclosed. That's the core of the case. We certainly are not saying that Dr. Zibo hoped it would fail, knew it would fail, thought it would fail, that would not be a successful claim
. I think that answers your question, Your Honor. Yes, okay. I think I've gone over. Thank you, Your Honor. Yes, we thank Council for the argument, it was helpful. And with that, the Court has completed the oral argument calendar for the day and we stand adjourned