[00:00:00] Speaker 03:
With that, we'll move to the next case on the argument calendar, success by media holdings versus the Federal Trade Commission.

[00:00:45] Speaker 03:
Make your time counts.

[00:01:20] Speaker 04:
May it please the court.

[00:01:21] Speaker 04:
My name is David Abney, representing the appellants today.

[00:01:28] Speaker 04:
We have a historically very interesting case.

[00:01:31] Speaker 04:
When the Federal Trade Commission Act was passed in 1914, it was at the height of the progressive era.

[00:01:37] Speaker 04:
It was the culmination of efforts by Theodore Roosevelt, William Taft, and finally Woodrow Wilson to try to bring in expertise to help out

[00:01:49] Speaker 04:
the people of the United States with very difficult problems.

[00:01:52] Speaker 04:
Before the progressive era, things had been on a hit and miss basis.

[00:01:56] Speaker 04:
But the progressives, one of their fundamental thoughts was things have gotten so complicated and difficult.

[00:02:01] Speaker 04:
We need experts.

[00:02:02] Speaker 04:
We need administrative boards that can handle things like trade, commerce, public health to unravel these problems and deal with these difficult problems of a rapidly growing nation.

[00:02:15] Speaker 04:
And so the Congress passed the FTC Act.

[00:02:17] Speaker 04:
over the years it has amended it.

[00:02:20] Speaker 04:
But one of the principles of the enforcement part of all this is that you're protecting not only the rights of consumers, but you're also protecting the rights of people who are accused of committing deceptive acts and trade practices and so forth.

[00:02:35] Speaker 04:
So there's a very definite system here where the judiciary plays a key role in making sure that things are done properly and that the rights of everybody receive proper protection.

[00:02:49] Speaker 04:
Over the last few months, we've seen what happens when the executive branch decides it wants to push the judiciary aside, take over and decide for itself everything that's important, and say, well, we get to judge every single thing that goes on.

[00:03:02] Speaker 04:
We're in charge here.

[00:03:04] Speaker 04:
And it doesn't really matter what the rules are, what the regulations are, what the statutes are.

[00:03:08] Speaker 02:
Also, could we move to the specific issues, if you don't mind, before your time runs out?

[00:03:15] Speaker 02:
And I'd appreciate your addressing

[00:03:17] Speaker 02:
why it was improper to award a civil contempt sanction calculated based on net revenues?

[00:03:30] Speaker 04:
It looked to me from what I read in the record that it was calculated based on gross revenue.

[00:03:34] Speaker 04:
But even if it's on net revenue, you still have to take into account an offset.

[00:03:39] Speaker 04:
And contempt, those sorts of sanctions are supposed to be proportional

[00:03:44] Speaker 04:
and calibrated to the actual harm that has been suffered.

[00:03:48] Speaker 04:
But there was no evidence here that they weren't actually calibrated to that.

[00:03:51] Speaker 04:
You sort of say, how much money did you bring in?

[00:03:53] Speaker 04:
OK.

[00:03:54] Speaker 02:
Well, they brought in a whole lot.

[00:03:56] Speaker 02:
And the people that they duped got 2% or 6% or something of that money back.

[00:04:04] Speaker 02:
So basically, they kept essentially all of it.

[00:04:09] Speaker 02:
So I guess I don't really understand why it was improper

[00:04:14] Speaker 02:
to look at that very large number.

[00:04:18] Speaker 04:
Well, the very large number was, was based on essentially receipts coming in.

[00:04:22] Speaker 04:
This is money that's come in and now.

[00:04:24] Speaker 02:
Right.

[00:04:25] Speaker 02:
And, and it was not used for, it was unlawful what they were doing.

[00:04:32] Speaker 04:
According, according to the FTC, according to the district judge also at the end though, but you can award a compensatory, a civil compensatory sanction

[00:04:42] Speaker 04:
unless it's calibrated to the actual loss.

[00:04:44] Speaker 04:
And this wasn't calibrated to the actual loss.

[00:04:46] Speaker 04:
The money coming in is not the same as the actual loss.

[00:04:48] Speaker 04:
If there's an offset for people who use the products and are thoroughly satisfied with those products, thousands of people would come into the district court presenting statements that they were satisfied with the products.

[00:05:00] Speaker 04:
So you've got a disconnect here between an actual calibration of that civil compensatory sanction

[00:05:07] Speaker 04:
and what actually happened.

[00:05:09] Speaker 04:
And of course, there's no, and you may ask my colleague about this because I've not found anything in the record that's helpful.

[00:05:16] Speaker 04:
Where's the money?

[00:05:18] Speaker 04:
Was it actually paid back to anybody?

[00:05:22] Speaker 04:
There's nothing there to show that it ever was or ever will be.

[00:05:24] Speaker 04:
The money went to the FTC, dropped into a dark hole, and there it seems to remain.

[00:05:28] Speaker 03:
Well, hasn't the FTC represented to us?

[00:05:32] Speaker 03:
And yes, we can certainly ask your friend, but haven't they represented to us that the money will only be gone to victims?

[00:05:38] Speaker 03:
I'm not so sure that that's right.

[00:05:41] Speaker 02:
Well, as I read it, their position is that all monetary relief must be distributed to the consumers and that any money left over after distribution to the consumers would be returned to the defendants unless the court were to order otherwise.

[00:05:56] Speaker 04:
That's what appears on paper.

[00:05:58] Speaker 02:
Well, that's what we're looking at.

[00:06:01] Speaker 04:
Well, you've got a gentleman right here if you want to ask the question, where's the money?

[00:06:06] Speaker 04:
I think the answer would be highly illuminating.

[00:06:08] Speaker 03:
But that was the court order, right?

[00:06:09] Speaker 03:
That that's what had to happen.

[00:06:11] Speaker 02:
You're challenging the court order.

[00:06:12] Speaker 02:
You're challenging what's on paper.

[00:06:14] Speaker 03:
Yes.

[00:06:15] Speaker 02:
Okay, so that's what we have to look at is what's on paper and that is what is on paper, correct?

[00:06:20] Speaker 04:
Yes, but there is a disconnect between civil compensatory sanctions supposed to be calibrated to the actual loss.

[00:06:29] Speaker 04:
No offsets were figured out.

[00:06:31] Speaker 04:
So what was the actual loss to these consumers?

[00:06:34] Speaker 04:
Many of them who took the products, the coffees, the teas, the supplements, the travel stuff, they took all those products, were satisfied with them.

[00:06:42] Speaker 04:
Where's the offset?

[00:06:43] Speaker 04:
It's not there.

[00:06:45] Speaker 04:
So this cannot be a properly calibrated civil compensatory sanction.

[00:06:49] Speaker 04:
It simply cannot be as a matter of fact.

[00:06:52] Speaker 04:
And I only made that suggestion to the court.

[00:06:53] Speaker 04:
I'm not trying to be flippant or anything, but I would like to know

[00:06:58] Speaker 04:
Perhaps the court would like to know where is that money right now?

[00:07:03] Speaker 04:
If I may return, the system is set up in such a way that if the FTC perceives a problem by statute, what they're supposed to go in is they see immediate problem, deceptive acts and practices, people are being harmed, get a rapid injunctive relief from the court.

[00:07:21] Speaker 04:
Stop.

[00:07:23] Speaker 04:
You stop everything you're doing that's bad.

[00:07:25] Speaker 04:
You don't stop everything.

[00:07:26] Speaker 04:
You stop everything doing this bad.

[00:07:28] Speaker 03:
Well, they tried that once, right?

[00:07:30] Speaker 04:
Well, not in this particular case.

[00:07:32] Speaker 03:
No, I understand.

[00:07:32] Speaker 04:
In another case.

[00:07:33] Speaker 04:
Yes, and that's why they brought the contempt sanction, right?

[00:07:36] Speaker 04:
Well, in that other case.

[00:07:37] Speaker 04:
But we're talking about this particular case, this particular court-appointed receiver who took over.

[00:07:43] Speaker 04:
Instead of just saying, stop what you're doing that's wrong, they said, stop what you're doing that's wrong.

[00:07:48] Speaker 04:
And by the way, we want the court to order, we can take over everything.

[00:07:52] Speaker 04:
We can appoint a receiver.

[00:07:53] Speaker 04:
We can seize all the assets.

[00:07:55] Speaker 04:
And we can run your businesses for you, which they did, and ran them into the ground until there was practically nothing left.

[00:08:01] Speaker 04:
That's not how this is set up.

[00:08:04] Speaker 04:
There's a very straightforward, complicated system, actually.

[00:08:09] Speaker 04:
You start with one simple step, and then it gets complicated.

[00:08:12] Speaker 04:
The simple step is identify something that's wrong, needs to be stopped.

[00:08:15] Speaker 04:
You get a TRO, you get a preliminary injunction, you stop it.

[00:08:19] Speaker 04:
Then you're supposed to go through this.

[00:08:21] Speaker 03:
You get a preliminary injunction or an order from the court, and if the individuals who are the subject of it stop, then it stops it.

[00:08:33] Speaker 04:
You're done.

[00:08:33] Speaker 03:
If they follow the order.

[00:08:36] Speaker 04:
Right.

[00:08:37] Speaker 04:
But here the FTC presumption was you're not going to follow any order, so we're going to ignore section 19, which has this very long complex procedure.

[00:08:49] Speaker 04:
You serve a complaint.

[00:08:50] Speaker 04:
The violator is supposed to come before an administrative law judge.

[00:08:54] Speaker 04:
That never happened.

[00:08:55] Speaker 04:
The violator has a right to appear and show cause why the FTC should not be acting the way it is.

[00:09:01] Speaker 04:
And that never happened.

[00:09:03] Speaker 04:
The hearing testimony at the administrative hearing is supposed to be reduced to writing and filed in the office of the FTC.

[00:09:08] Speaker 04:
That never happened.

[00:09:10] Speaker 04:
If after the hearing, the FTC says that it's unhappy, then it states findings.

[00:09:17] Speaker 02:
Council, I have a question because it seems to me that I read your opening brief to be challenging the remedies that the district court chose.

[00:09:31] Speaker 02:
And I didn't read it to be challenging the underlying procedures, which is what you're discussing now.

[00:09:39] Speaker 02:
Am I reading your brief incorrectly?

[00:09:43] Speaker 04:
Somewhat.

[00:09:44] Speaker 04:
The whole point of it is that the district court had no, the FTC had no authority to act the way it did, and the district court had no authority to go along with what the FTC wanted.

[00:09:55] Speaker 04:
The FTC used Section 13 to take over the business, appoint a receiver, seize the assets, freeze the assets, and run things into the ground.

[00:10:05] Speaker 04:
That's not what Section 5, Section 13B, and Section 19, when read together in the proper manner, provides.

[00:10:13] Speaker 04:
If you're going to do these extraordinary remedies, if you're going to be seizing assets, freezing assets, seizing business records, taking over business, seeking damages and sanctions, you have to go through the section 19, section 5 process.

[00:10:29] Speaker 04:
You can't use section 13 as the basis for what you were doing.

[00:10:33] Speaker 04:
But that's what the FTC did, and if the district court went along with it, that was wrong.

[00:10:38] Speaker 04:
The process that was used, the statutory justification was wrong.

[00:10:43] Speaker 04:
Judge Lefkoe has a question.

[00:10:44] Speaker 01:
What is your authority for that proposition?

[00:10:47] Speaker 04:
The AMG case and the statutes themselves.

[00:10:50] Speaker 01:
But AMG doesn't really speak to the situation here.

[00:10:56] Speaker 01:
It was discussing 13B.

[00:11:00] Speaker 04:
Right, 13B.

[00:11:02] Speaker 04:
That's what the court used.

[00:11:03] Speaker 04:
That's what the FTC used in this case.

[00:11:09] Speaker 04:
I mean, it's not precisely on point, but the point that it is on point, well, I've got too many points there, is that Congress set up this particular structure.

[00:11:23] Speaker 04:
13B has a very limited use.

[00:11:26] Speaker 04:
The FTC in the 1970s started saying, well, we can use Section 13 really to do what Section 13, Section 5, and Section 19 are all supposed to do together.

[00:11:35] Speaker 04:
We can just leap directly from Section 13

[00:11:38] Speaker 04:
take over businesses, seize businesses, appoint receivers, and push these businesses into a settlement, which is what usually happens, or get damages.

[00:11:46] Speaker 04:
And that's not what section 13 is for.

[00:11:50] Speaker 04:
Section 13 is for stopping bad stuff right now.

[00:11:55] Speaker 04:
And then you go to section 19 and section 5, and you go through all those administrative law judge steps, everything else.

[00:12:02] Speaker 04:
You wind up actually with an appeal to a court of appeals.

[00:12:07] Speaker 04:
And it's a long, detailed, very, very protective process.

[00:12:13] Speaker 04:
But the FTC didn't want to use it, doesn't want to use it, says we don't have to use it.

[00:12:17] Speaker 04:
That's not right.

[00:12:18] Speaker 04:
And I think AMG is good authority for starting the analysis.

[00:12:23] Speaker 04:
It's not precisely on point, but it's making a key pronouncement that you're supposed to follow what the statutes actually say.

[00:12:31] Speaker 04:
And what the statutes actually say is not what the FTC says they say at all.

[00:12:36] Speaker 04:
FTC just wants to ignore Section 19 and Section 5 and go through Section 13, a very streamlined process.

[00:12:43] Speaker 01:
Is there a difference between a rule violation and a statutory violation?

[00:12:49] Speaker 01:
I mean, are there different remedies for, like here, it looks like we have a rule violation.

[00:12:58] Speaker 04:
Well, if you have a rule violation, it works back backward to the statute.

[00:13:02] Speaker 04:
Say we have violation of the rule, therefore we can do certain statutory things.

[00:13:05] Speaker 04:
So they work together, but you cannot get into court.

[00:13:10] Speaker 04:
and go through this elaborate process that the FTC used here to take over the business, get the receiver appointed, and all that stuff, unless you go through all the steps that are provided by Section 5 and Section 19, and then you've already done your Section 13 thing, which is basically to freeze things and get people to stop doing bad acts.

[00:13:37] Speaker 04:
I think those are my major points.

[00:13:40] Speaker 04:
I'd be happy to talk some more about it.

[00:13:42] Speaker 03:
Do you want to reserve the rest of your time?

[00:13:44] Speaker 04:
Well, yes, just a minor, well, may not so minor thing.

[00:13:48] Speaker 04:
And I started talking about the judicial and executive branch environment we're living in.

[00:13:54] Speaker 04:
And I think that's why this case, one reason this case is so important.

[00:13:58] Speaker 04:
You've got to limit executive authority according to what Congress intended.

[00:14:04] Speaker 04:
And I will reserve my remaining time.

[00:14:07] Speaker 03:
All right, we'll hear from the commission.

[00:14:16] Speaker 00:
May it please the court.

[00:14:17] Speaker 00:
I'm Matthew Weprin on behalf of the Federal Trade Commission.

[00:14:21] Speaker 00:
Your honor, I think it's important to start here by reminding you that appellants do not dispute liability.

[00:14:26] Speaker 00:
They only challenge certain aspects of the remedy.

[00:14:29] Speaker 00:
So that makes the question before the court here today a simple one.

[00:14:32] Speaker 00:
Did the district court abuse its discretion when it granted the challenge remedies?

[00:14:37] Speaker 00:
The answer is no.

[00:14:39] Speaker 00:
In this case, the FTC sought three categories of remedy that were challenged.

[00:14:43] Speaker 00:
First, compensatory contempt sanctions for violation of the 2002 injunction.

[00:14:48] Speaker 00:
Second, a broader injunction barring all multilevel marketing activities.

[00:14:52] Speaker 00:
And third, consumer redress under section 19 of the FTC Act for rule violations.

[00:14:59] Speaker 00:
Here, the district court did an excellent job managing this complicated case through several years of complex procedural history, and ultimately after summary judgment and a bench trial, the district court here granted much of the relief sought by the FTC in order to stop the illegal conduct, prevent it from occurring again in the future, and also to provide redress to consumers that were harmed by this conduct and the violation of the prior 2002 order.

[00:15:25] Speaker 00:
Now, Your Honor, throughout all this, the District Court never abused its discretion.

[00:15:30] Speaker 00:
It exercised its discretion and relied on very specific authorities for each category of remedy here.

[00:15:37] Speaker 00:
For the compensatory contempt sanctions, the District Court relied on its inherent ability to enforce its own orders.

[00:15:44] Speaker 00:
And here the district court followed the guidance of the e-debit pay case of this court and exercised its broad discretion to calculate consumer harm based on the net revenues that basically the money paid directly by consumers to the operators of these pyramid schemes.

[00:16:02] Speaker 03:
So counsel, it may well not be relevant to the issues we're looking at, but where is the $7 million?

[00:16:10] Speaker 00:
Your honor, the seven million dollars has not been received by the FTC.

[00:16:13] Speaker 00:
We have sixty thousand dollars in frozen assets remaining from the individual defendants, but we need to collect on the seven point three million dollars and we plan to try to do so after this appeal.

[00:16:23] Speaker 01:
Oh, it's just a judgment, right?

[00:16:26] Speaker 00:
Yes, your honor.

[00:16:26] Speaker 00:
Right.

[00:16:27] Speaker 01:
So.

[00:16:30] Speaker 01:
What support do you have for the position that AMG does not preclude the FTC from commencing an action under 19A1 in the Federal District Court?

[00:16:42] Speaker 00:
Your Honor, Section 19A1 was not impacted by AMG.

[00:16:46] Speaker 00:
The AMG case was just about the powers that the FTC has under Section 13B to seek equitable monetary relief.

[00:16:53] Speaker 00:
The FTC still continues to have the powers to seek permanent injunctions and preliminary injunctions under Section 13B.

[00:17:00] Speaker 00:
And the FTC also has the authority to seek rule violation orders under Section 19A1 of the FTC Act directly in federal court.

[00:17:10] Speaker 00:
And you can look at the Simple Health case, which is a Section 19A1 case in the 11th Circuit that is after AMG.

[00:17:20] Speaker 00:
Would you say that again?

[00:17:22] Speaker 00:
What case was it?

[00:17:23] Speaker 00:
The Simple Health Plan case, I believe cited in my brief, which is a post-AMG case involving Section 19.

[00:17:29] Speaker 01:
So when you filed the case, well, the district court imposed asset freeze and receivership for did it for the purpose of equitable monetary relief at the very beginning?

[00:17:46] Speaker 01:
And then after AMG, did it change its tune to

[00:17:50] Speaker 01:
This is for rule violation only.

[00:17:52] Speaker 00:
Yes, Your Honor.

[00:17:56] Speaker 00:
Initially, when we filed this case, Section 13B still allowed the FTC to get equitable monetary relief under the Ninth Circuit precedent.

[00:18:03] Speaker 00:
However, the district court did reassess the preliminary injunction following AMG and determined that the asset freeze was justified under section 19A1 because of the possibility of equitable remedies.

[00:18:16] Speaker 00:
At that time, the FTC had a theory for about $1 million in harm based on those violations.

[00:18:22] Speaker 01:
So are we to judge it on, I mean, the law that you followed at that time, we still have to follow AMG, right?

[00:18:33] Speaker 00:
Well, yes, your honor.

[00:18:34] Speaker 00:
And AMG was properly applied here by the district court in order to just apply to Section 13B, Equitable Monetary Relief.

[00:18:42] Speaker 01:
So how do you understand the relief that the appellant wants to be?

[00:18:49] Speaker 01:
Return of the $440,000?

[00:18:57] Speaker 00:
It appears the appellant wants that relief.

[00:18:59] Speaker 00:
However, at this point, any money that's still subject to the asset freeze would go towards the $7.3 million contempt sanction regardless.

[00:19:11] Speaker 00:
Unless you have any other questions about the contempt sanction, I can move on to the permanent injunction barring multilevel marketing.

[00:19:18] Speaker 00:
The permanent injunction barring multi-level marketing is justified under Section 13B of the FTC Act, which allows the FTC to get permanent injunctions in federal court.

[00:19:27] Speaker 00:
The district court here carefully followed this court's ruling in the Grant Connect case, which supplied a three-factor test to assess the scope of an injunction, and the district court properly applied its discretion to ban all multi-level marketing in order to stop similar illegal conduct from occurring again in the future.

[00:19:44] Speaker 00:
And the third category relief was consumer redress under section 19 of the FTC Act.

[00:19:51] Speaker 00:
In this case, the district court found $6,800 in consumer redress was acquired for violations of the merchandise rule.

[00:19:59] Speaker 00:
And the district court was well within its discretion to do so.

[00:20:02] Speaker 00:
Appellants also appear to challenge a few other issues that the FTC believes are not properly before this court.

[00:20:08] Speaker 00:
And that is because at this point, the preliminary injunction has now merged into a permanent injunction and has rendered some of these issues moot.

[00:20:16] Speaker 00:
Specifically, for example, the appellants appear to challenge the receivership being established and the management of that receivership.

[00:20:24] Speaker 00:
But the receivership has now been terminated by the permanent injunction.

[00:20:28] Speaker 00:
And they also challenged the previous basis for the section 19 asset freeze, which is now based on the $7.3 million contempt sanction.

[00:20:36] Speaker 00:
The FTC believes these issues are not properly before the court, but even if they were before the court, the FTC believes that the district court was well within its discretion in all these areas.

[00:20:48] Speaker 00:
Unless the court has any further questions for me, I would rest on the brief and ask that the district court's judgment be affirmed.

[00:20:55] Speaker 01:
I just, I find that, you know, statutory interpretation here is a little difficult, but if the, if the receivership was unlawful, even though it was terminated, wouldn't there be, wouldn't the appellant have some grounds to say,

[00:21:20] Speaker 01:
I want the money back, right?

[00:21:22] Speaker 01:
Or the receivership was improper and therefore the amount of money you spent on it was improper.

[00:21:30] Speaker 00:
Your honor, that may be so, but here the FTC was well within its authority to ask for and district court was well within its authority to order a receivership.

[00:21:39] Speaker 01:
I'm just saying if, you know, you're saying it's moot because it was dissolved.

[00:21:45] Speaker 00:
Yes, Your Honor.

[00:21:47] Speaker 00:
I understand your question.

[00:21:48] Speaker 00:
And there is one of the reasons why here the receivership ran out of money.

[00:21:52] Speaker 00:
And one of the reasons why there is an interlocutory jurisdiction to challenge these sort of receiverships is to prevent this exact problem, which is allowing the appellants to appeal this decision earlier, which they could have done.

[00:22:04] Speaker 00:
And that actually did do in the post AMG decision then voluntarily dismissed.

[00:22:09] Speaker 03:
So it certainly would have been before our court then.

[00:22:13] Speaker 03:
Yes.

[00:22:14] Speaker 03:
Did my colleagues have any other questions?

[00:22:17] Speaker 02:
No, for me.

[00:22:17] Speaker 03:
Thank you.

[00:22:18] Speaker 03:
And counsel, you have some time left for rebuttal.

[00:22:27] Speaker 04:
You get to the old problem.

[00:22:28] Speaker 04:
What happens when you have the government comes forward or a party comes forward and says, based upon this precedent, I win, when that precedent was wrong since the 1980s.

[00:22:40] Speaker 04:
And so every circuit court went along with the FTC.

[00:22:43] Speaker 04:
I don't know why.

[00:22:44] Speaker 04:
Nobody read the statutes.

[00:22:46] Speaker 04:
And if you get to AMG and they finally say, enough's enough.

[00:22:51] Speaker 04:
This is what the statute says.

[00:22:53] Speaker 04:
You have not been doing it.

[00:22:54] Speaker 04:
You're all wrong.

[00:22:56] Speaker 04:
So is a decision based on a wrong reading of a statute good?

[00:23:00] Speaker 04:
I don't see how it could be.

[00:23:02] Speaker 04:
You simply didn't understand what was right in front of you.

[00:23:06] Speaker 03:
So the 11th Circuit got it wrong too.

[00:23:09] Speaker 03:
Every circuit, this circuit got it wrong.

[00:23:10] Speaker 03:
No, I mean the 11th Circuit since AMG got it wrong.

[00:23:15] Speaker 04:
They limited it somewhat more than it needs to be limited, but that's fine.

[00:23:19] Speaker 04:
You're not bound to follow what the 11th Circuit Code says.

[00:23:25] Speaker 04:
You should be looking at the statute first, and then, of course, the interpretation of statute by the highest authority in the land.

[00:23:31] Speaker 04:
That's what matters.

[00:23:33] Speaker 04:
As far as the receivership, there was a challenge to that from the beginning.

[00:23:37] Speaker 04:
They fought that like the Dickens.

[00:23:40] Speaker 02:
And if the receiver was... Was counsel correct that

[00:23:44] Speaker 02:
that was appealed and that the appeal was voluntarily dismissed?

[00:23:52] Speaker 04:
If it was, I don't remember it.

[00:23:53] Speaker 04:
I thought I was on that appeal.

[00:23:56] Speaker 04:
And I don't remember a voluntary dismissal, but if he says it happened that way, I suppose it did.

[00:24:00] Speaker 02:
Well, if that occurred, why would it be before us now if that was a lost opportunity?

[00:24:06] Speaker 04:
I don't remember a voluntary dismissal.

[00:24:08] Speaker 04:
I remember getting thrown out by the Ninth Circuit.

[00:24:10] Speaker 04:
That's what I remember.

[00:24:12] Speaker 04:
So I mean, if it happened the way he says and he's.

[00:24:16] Speaker 04:
I'm living in a different reality.

[00:24:17] Speaker 04:
We tried to get the court to enforce AMG just after it came out, came up here and says the district judge is wrong.

[00:24:23] Speaker 04:
You got to enforce AMG and the K and the appeal ended with, as I remember, say you're wrong.

[00:24:29] Speaker 04:
But.

[00:24:31] Speaker 04:
I don't know exactly.

[00:24:32] Speaker 04:
I I I'll have to if I may supplement to the court exactly what happened.

[00:24:38] Speaker 04:
Four seconds, well, not much to say there.

[00:24:41] Speaker 04:
Oh, rules.

[00:24:43] Speaker 04:
Just one minor thing.

[00:24:45] Speaker 04:
We talked earlier about rules and regulations.

[00:24:47] Speaker 04:
The FTC says you violated the merchandise rule.

[00:24:49] Speaker 04:
They violated the cooling off rule.

[00:24:53] Speaker 04:
They lost 100% on the cooling off rule.

[00:24:55] Speaker 04:
Merchandise rule, they had asked for $560,000 in damages, and they got $6,829.

[00:25:01] Speaker 04:
All of this mess, receivership and everything else, and they got $6,829.

[00:25:11] Speaker 03:
All right.

[00:25:11] Speaker 03:
Thank you.

[00:25:12] Speaker 03:
Thank you, counsel.

[00:25:13] Speaker 03:
We thank counsel for their arguments and the case just argued is submitted.