[00:00:30] Speaker 02:
Okay, our final case this morning is number 17-1095 Pioneer Reserve LLC versus the United States.

[00:00:39] Speaker 02:
Mr. Cale, is that how you pronounce it?

[00:00:42] Speaker 03:
May I please the court?

[00:00:43] Speaker 03:
Good morning.

[00:00:44] Speaker 03:
Yes, Douglas Cale, representing the appellant in this matter.

[00:00:49] Speaker 03:
So, of course, what we have here is a breach of contract action.

[00:00:52] Speaker 03:
The court decided that our mitigation bank agreement was a contract.

[00:00:55] Speaker 03:
The court decided that the government reached the contract

[00:00:59] Speaker 03:
but then went further and said the problem was though my client had two competitors, they were willing to undercut our prices and therefore we couldn't prove and did not prove that in the non-breach world we would have sold.

[00:01:13] Speaker 03:
What is the contract here?

[00:01:15] Speaker 02:
And I've read the contract, it seems to say that the government wouldn't give your client a certain number of credits.

[00:01:24] Speaker 02:
You say that that was

[00:01:26] Speaker 02:
incorrectly computed, I guess for the moment it's accepted that it was incorrectly computed that you should have had 124 credits instead of whatever it was, 17.

[00:01:38] Speaker 02:
But the contract is not very clear about what it's promising other than to give you the credits.

[00:01:48] Speaker 02:
Do you view the contract as incorporating the regulatory scheme here?

[00:01:53] Speaker 03:
Well, it certainly is written in the backdrop of the regulatory scheme, but the operative language of the contract, of course, the court determined it was a contract, is the operative language says, first of all, that it rewards these contracts and it goes on to... Credits.

[00:02:10] Speaker 03:
Thank you.

[00:02:10] Speaker 03:
Credits, these mitigation credits, and goes on to say that the mitigation bank or my client can use, sell, convey these credits in commerce.

[00:02:22] Speaker 03:
So that's the intent.

[00:02:23] Speaker 03:
What does that mean in accordance with the regulatory scheme?

[00:02:27] Speaker 03:
It has to be, because these credits are meaningless without a regulatory scheme.

[00:02:32] Speaker 03:
They only have meaning.

[00:02:33] Speaker 03:
They only have value in the context of the regulatory scheme, which provides for mitigation being required in order to have a permittee under 404 impact the environment.

[00:02:46] Speaker 02:
Okay, so what we have here, as I understand it,

[00:02:49] Speaker 02:
government has conceded that on the regulatory scheme, if it had had the right number of credits, 124 credits, that it would have required the railroad, at least initially in the permit, to purchase those credits, right?

[00:03:04] Speaker 02:
Correct.

[00:03:05] Speaker 02:
Yes.

[00:03:05] Speaker 02:
So the question is whether that transaction would have occurred, that is, whether the parties would have reached agreement, and whether if they didn't reach agreement,

[00:03:19] Speaker 02:
that the government would change the terms of the permit as it did with respect to the 17 credits.

[00:03:26] Speaker 02:
And I've read parts of this record and I guess what's missing it seems to me is any suggestion that the transaction would have gone through at the 79,000 or 89,000 per credit level or that the permit would have required

[00:03:49] Speaker 02:
that it goes through at that level.

[00:03:51] Speaker 02:
I mean, I think your witness testified, if I recall correctly, that that price of $79,000 or $89,000 was not something that your client would depart from.

[00:04:05] Speaker 03:
Two arguments, Your Honor.

[00:04:07] Speaker 03:
First of all, sure.

[00:04:08] Speaker 03:
So that is the question.

[00:04:10] Speaker 03:
Would we have sole credits to the railroad in a non-breach world?

[00:04:15] Speaker 03:
The trial court, as you observed, found that there's no question

[00:04:19] Speaker 03:
No question on page 11 of the decision that in a non-breach world, the Corps would have required the railroad to bow all the way.

[00:04:27] Speaker 02:
Sure, as an initial matter.

[00:04:28] Speaker 02:
But the question is whether they would have modified the permit if the parties reached an impasse as to the price.

[00:04:38] Speaker 03:
Which the Corps did post-breach.

[00:04:41] Speaker 03:
They allowed then this railroad to go to two other sources.

[00:04:45] Speaker 03:
And consistent with that, what does the trial court say?

[00:04:49] Speaker 03:
Unfortunately, Pioneer's downfall, back on page 14 in the decision, the downfall is that Pioneer had two competitors willing to undercut their prices.

[00:04:59] Speaker 03:
That was their problem.

[00:05:01] Speaker 03:
The problem is that finding by the court is contrary to the clear evidence.

[00:05:06] Speaker 03:
What did it find, or what did it say were the two competitors that were willing to undercut Pioneer's prices?

[00:05:12] Speaker 03:
Great Land Trust and Sue Connect.

[00:05:15] Speaker 03:
Look to what their witnesses said.

[00:05:18] Speaker 03:
There witnessed Dr. Guion in response to questions from the court, talking about who the competition is.

[00:05:27] Speaker 03:
Dr. Guion says, quoting, looking at page 1649 from the appendix, Dr. Guion says, in quotes, Sue Kinnick would not have been a competitor, period, end quotes.

[00:05:40] Speaker 03:
How clear can it be?

[00:05:41] Speaker 03:
Their expert, not our expert, their expert testifies.

[00:05:45] Speaker 01:
I don't think there's any question that

[00:05:47] Speaker 01:
you would have been the first choice for credits under the regulatory scheme.

[00:05:52] Speaker 01:
But that regulatory scheme doesn't mandate that the purchaser go with you if it can't meet an agreeable price, correct?

[00:06:02] Speaker 01:
If the core will change the permit.

[00:06:05] Speaker 03:
Well, let's see what the experts said about that very question.

[00:06:08] Speaker 01:
Well, just as a matter of the regulatory scheme, if the core directs the purchaser to go to you first, and you negotiate, you reach an impasse, can the purchaser go back to the core and say, we can't reach a mutually agreeable price, modify the permit to let us go elsewhere?

[00:06:27] Speaker 03:
Go with yes.

[00:06:29] Speaker 03:
But what's the question in the context of this case and these facts and the evidence adduced at trial?

[00:06:36] Speaker 03:
Dr. Guion goes further to say, in response to questions from the trial court, talking about this scenario and the different types of mitigation, the different tiers, mitigation bank credits being their best, dropping down.

[00:06:50] Speaker 03:
Dr. Guion says, as to specifically the railroad that Sue Kinnick, one of these supposed competitors,

[00:06:58] Speaker 03:
He says they would not have been competition if they had made a bid in a non-breach world, the bid would have been void.

[00:07:09] Speaker 03:
I don't understand that.

[00:07:11] Speaker 02:
What we have here is a situation which your client testified that they would have insisted on a price of $79,000 or $89,000, correct?

[00:07:19] Speaker 03:
Sure.

[00:07:20] Speaker 02:
Okay.

[00:07:21] Speaker 02:
And is there any testimony that the railroad

[00:07:24] Speaker 02:
would have paid that much for the credits?

[00:07:26] Speaker 03:
Well, here's the evidence on that point, Judge.

[00:07:28] Speaker 02:
No, no, just answer the question.

[00:07:30] Speaker 02:
Is there any testimony that the railroad would have paid that much for the credits?

[00:07:34] Speaker 03:
I'm going to say, sure.

[00:07:34] Speaker 03:
You know where it is?

[00:07:36] Speaker 03:
Keep in mind, the railroad's a state agency.

[00:07:38] Speaker 03:
The Alaska Department of Transportation, another state agency, two different occasions, bought our credits for $79,000 a piece.

[00:07:46] Speaker 03:
That's different state agencies, though.

[00:07:47] Speaker 01:
It's not the railroad.

[00:07:49] Speaker 01:
And in fact, the railroad, when you are negotiating a price for the 16 credits,

[00:07:54] Speaker 01:
that you were improperly reduced to, rejected a bid of $88,000.

[00:07:59] Speaker 03:
And why did the railroad, how were they ultimately able to buy credits instead for $10,000 a piece?

[00:08:09] Speaker 03:
And I think it was $29,000 a piece from Great Ranch Trust.

[00:08:12] Speaker 03:
How were they able to do that?

[00:08:13] Speaker 03:
Because post breach, they then allowed the railroad to buy credits that Dr. Guillaume said were not appropriate.

[00:08:24] Speaker 03:
that they would be void.

[00:08:26] Speaker 03:
And look at what Nicole Hayes said.

[00:08:29] Speaker 03:
One of the supervisors in the Alaska Corps regulatory division, she is talking about, once Dr. Geyon says, well, Sue Knick, that wouldn't be competition, the trial court then, he's asking Nicole Hayes.

[00:08:46] Speaker 03:
And she's talking about the Great Land Trust.

[00:08:49] Speaker 03:
As you recall,

[00:08:50] Speaker 03:
The Great Land Trust doesn't sell mitigation bank credits.

[00:08:52] Speaker 03:
They sell these things called in lieu fee credits, which is nothing more than an unsecured promise to take your money and one day buy the credits.

[00:08:59] Speaker 01:
You know what?

[00:09:00] Speaker 01:
I get all this.

[00:09:00] Speaker 01:
There's no, like I said, there is no dispute that yours were the best credits.

[00:09:05] Speaker 01:
They had the highest priority level and the core was going to try to force the railroad to buy your credits.

[00:09:12] Speaker 01:
But the court still had options to modify the permit.

[00:09:15] Speaker 01:
That's what it did in the post-breach world.

[00:09:18] Speaker 01:
You have to show in the pre-breach world that it would not have exercised those options and that it would have made the railroad use all of your 124 credits at $89,000.

[00:09:30] Speaker 03:
And what does Dr. Guillon say about that?

[00:09:33] Speaker 03:
Again, their witness.

[00:09:36] Speaker 03:
The judge is asking him, okay, what do you think about Pioneer's argument that

[00:09:40] Speaker 03:
If things have been done correctly, in other words, in an iron-breached world, if things have been done correctly, Pioneer says that the core would not have gotten down into lower tier forms of mitigation.

[00:09:54] Speaker 03:
What do you think about that?

[00:09:55] Speaker 03:
What did Dr. Guion say?

[00:09:57] Speaker 03:
He says, and I'm reading from page 1651 of the appendix, he says, if Pioneer had 160.2 polyester credits, which we did, if they hadn't been taken away,

[00:10:09] Speaker 03:
He says, if we had those number of credits, then he agreed with Pioneer that the Corps would have said to the railroad, in quotes now, you need to buy 160.2 credits from Pioneer.

[00:10:22] Speaker 02:
Well, yes, initially they would have said that.

[00:10:25] Speaker 02:
But then when the parties couldn't reach agreement because they were so far apart on price, based on past experience, it looks as though they would have modified the permit.

[00:10:37] Speaker 02:
And you don't have any testimony that they wouldn't have modified the permit.

[00:10:42] Speaker 03:
We have testimony they did modify the permit.

[00:10:44] Speaker 03:
They asked to allow these void credits to be bought.

[00:10:48] Speaker 03:
They allowed these in lieu fee credits to be bought.

[00:10:52] Speaker 03:
I don't understand how that helps you.

[00:10:54] Speaker 01:
I mean, that shows that the core in response, I mean, in the post-breach world, when you're negotiating over the 16 credits, that they would hold

[00:11:03] Speaker 01:
the railroad to your $88,000 offer.

[00:11:06] Speaker 01:
I understand you're pointing to your expert's testimony, but we have these other factual evidence.

[00:11:13] Speaker 01:
And we're on a clear error review on this, aren't we?

[00:11:16] Speaker 01:
Well, if there's other factual evidence supporting the notion that the poor would not have forced the railroad to purchase your credits at $89,000 because they were too expensive, then doesn't that end the case?

[00:11:30] Speaker 03:
No, it doesn't.

[00:11:31] Speaker 03:
Because post breach, yes, absolutely.

[00:11:33] Speaker 03:
The Corps allowed railroad to buy mitigation, which their experts said is inappropriate.

[00:11:40] Speaker 03:
And what Nicole Hayes, their supervisor says is inappropriate mitigation.

[00:11:44] Speaker 03:
She says, what we would require is something that actually offsets impacts.

[00:11:49] Speaker 03:
Here's an example for you.

[00:11:50] Speaker 01:
But here's the disconnect that I don't see.

[00:11:54] Speaker 01:
Clearly, because of the breach, you didn't have enough overall credits to sell.

[00:11:58] Speaker 01:
But you still had 16.

[00:12:01] Speaker 01:
And so if they were the best credits and that the Corps wanted those credits to be used, why wouldn't they have forced the railroad to buy those credits at that price, at the $88,000 reduced price, and then, because there were no other credits available, move on to the lesser forms?

[00:12:24] Speaker 03:
In a non-breach world, they should have.

[00:12:26] Speaker 03:
Here's a very brief example.

[00:12:28] Speaker 03:
I think this illustrates it.

[00:12:30] Speaker 03:
I signed a contract to buy a thousand Rolex watches for $5,000 apiece.

[00:12:35] Speaker 03:
I signed a contract and then somebody says, Doug, are you crazy?

[00:12:39] Speaker 03:
You can buy knockoff Rolex watches all day long for 50 bucks apiece on the streets of New York.

[00:12:44] Speaker 03:
I tell my party to the contract, hey, listen, I'm not going to buy your Rolex watches, but tell you what though, if you'll sell them for 50 bucks apiece, I'll buy them from you.

[00:12:55] Speaker 03:
Obviously, that person, because they're selling genuine Rolex watches, not void Rolex watches, not inappropriate knockoff watches, he says, I can't make that.

[00:13:03] Speaker 03:
I can't match that price.

[00:13:04] Speaker 03:
These are genuine mitigation bank credits.

[00:13:06] Speaker 03:
These are genuine Rolex watches.

[00:13:08] Speaker 02:
But the core allowed the credits to be bought that you say are void or are invalid credits.

[00:13:18] Speaker 02:
They allowed it.

[00:13:18] Speaker 02:
They considered them to be proper.

[00:13:20] Speaker 02:
What are you saying?

[00:13:20] Speaker 02:
That the core shouldn't have allowed those credits to be bought?

[00:13:24] Speaker 03:
Absolutely not.

[00:13:26] Speaker 03:
In a non-breach world, we contend, more likely than not, the Corps would not have allowed them to buy these void credits.

[00:13:32] Speaker 03:
Their experts said so.

[00:13:35] Speaker 03:
But they did allow them to buy them.

[00:13:37] Speaker 03:
We understand they did.

[00:13:38] Speaker 03:
They breached the contract, and they allowed them to buy these fake credits, if you will.

[00:13:42] Speaker 01:
Why do you keep calling them fake?

[00:13:43] Speaker 01:
I mean, the regulation allows three different tiers.

[00:13:47] Speaker 01:
They're not the most preferable, but they're not fake.

[00:13:54] Speaker 03:
They are inappropriate.

[00:13:55] Speaker 03:
According to their testimony, their person's testimony, that alternative, the Great Land Trust in lieu fees, were inappropriate.

[00:14:02] Speaker 03:
So here's a question.

[00:14:03] Speaker 02:
In a non-breach world, is it more likely than not that- Is that your sole argument, that the court couldn't appropriately allow these credits to be purchased from another source?

[00:14:16] Speaker 03:
Well, that's two arguments.

[00:14:18] Speaker 03:
That's one of the arguments is that in a non-breach world,

[00:14:21] Speaker 03:
It's more likely than not they would not have dropped down the hierarchy and allowed the permittee to buy credits that their experts said would be void.

[00:14:31] Speaker 01:
Even though in the breach world they did exactly that.

[00:14:35] Speaker 03:
That's what they did in the breach world.

[00:14:38] Speaker 01:
The fact that the breach doesn't

[00:14:40] Speaker 01:
have any bearing on whether they would have exercised their authority under the regulation as to drop down or not.

[00:14:47] Speaker 01:
I don't see the connection between the two.

[00:14:48] Speaker 03:
To that point, let's look at the other evidence that the trial court ignored.

[00:14:53] Speaker 01:
Why didn't you put on a damages model that didn't demand a price that had already been rejected by the railroad and a rejection which the government approved?

[00:15:06] Speaker 03:
Well, our damages model of $79,000 is based on actual sales.

[00:15:12] Speaker 02:
Actual sales to another?

[00:15:13] Speaker 02:
And your witness said that you wouldn't have accepted anything below $79,000 or $89,000?

[00:15:19] Speaker 03:
Because the best evidence was that was a fair market value.

[00:15:21] Speaker 01:
The only history... But the other evidence is that the railroad would never have agreed to that price and that the Corps, in a similar situation, would have granted their permission to modify the permit and get lesser credits.

[00:15:36] Speaker 03:
What would be the response to that?

[00:15:38] Speaker 03:
Again, at a preponderance of the evidence, what's the suggestion or where's the evidence that if the court stayed by the contract, stayed, followed the regulations, what's the evidence that they would not have required the railroad to buy all the mitigation from us as the court found that would have been ordered?

[00:15:59] Speaker 02:
Look at what- Okay, Mr. Allen, I think we're out of time.

[00:16:01] Speaker 02:
We'll give you two minutes for a bottle.

[00:16:02] Speaker 02:
Okay.

[00:16:03] Speaker 02:
Thank you.

[00:16:04] Speaker 02:
I mean, Mr. Cale.

[00:16:07] Speaker 02:
Mr. Long is next.

[00:16:28] Speaker 00:
Thank you, Judge Deiken.

[00:16:28] Speaker 00:
May it please the court

[00:16:30] Speaker 00:
The trial court correctly concluded that Pioneer failed to prove causation.

[00:16:33] Speaker 01:
This is a very strange case because I mean I think you concede breach or at least you lost on breach and you're not challenging that anymore and so it seems like at a certain point there would have been a price that the Corps would have forced the railroad to accept and so that there would have been actual damages but we're here now apparently because the other side refused to

[00:16:59] Speaker 01:
put on a price that would have been appropriate damages and therefore they're not entitled to a remedy at all.

[00:17:05] Speaker 01:
That seems really peculiar to me.

[00:17:07] Speaker 00:
Your Honor, the issue is, I mean there are steps in the process of proving damages of course and the problem is that there was never a willing buyer and a willing seller.

[00:17:17] Speaker 00:
I mean there's evidence in the record that they negotiated and as you referenced Pioneer came down to a price of $88,000 approximately.

[00:17:25] Speaker 00:
They weren't willing to go lower.

[00:17:26] Speaker 00:
They went as low as $79,000 for a transaction with another state agency, the Department of Transportation.

[00:17:33] Speaker 00:
And there's also evidence in the record demonstrating that that was the lowest, but they were willing to go for that transaction.

[00:17:38] Speaker 00:
There's nothing showing that they go lower.

[00:17:40] Speaker 01:
Right.

[00:17:41] Speaker 01:
I get that.

[00:17:42] Speaker 01:
That's why this case is strange to me.

[00:17:44] Speaker 01:
Your expert testified that there was some price that would be an appropriate amount of damages.

[00:17:48] Speaker 01:
I don't know, is it the $29,000, whatever it was?

[00:17:52] Speaker 00:
He testified to a range, Your Honor, yes.

[00:17:53] Speaker 01:
And why isn't that?

[00:17:55] Speaker 01:
a concession that at that price, the government would have forced the railroad to buy Pioneer's credits, all $162,000 at $29,000?

[00:18:07] Speaker 00:
Well, there are two issues with that.

[00:18:12] Speaker 00:
The first is, it assumes that under $29,000, there would have been some sort of negotiation, not only with Pioneer, but also with Great Land Trust, potentially with Sukunyak, although that's more complicated.

[00:18:24] Speaker 00:
They still have the credits, right?

[00:18:27] Speaker 00:
The credits are there.

[00:18:28] Speaker 00:
They have lost the credits.

[00:18:30] Speaker 00:
Correct, Your Honor.

[00:18:31] Speaker 00:
I think my friend would disagree with the exact number, but yes, they still are a functioning mitigation bank in Alaska.

[00:18:37] Speaker 02:
Okay, so what their reach claim is that they lost a particular opportunity to sell those credits to the railroad.

[00:18:46] Speaker 02:
Correct, Your Honor.

[00:18:46] Speaker 02:
And the question is whether they prove that that opportunity would have come to fruition.

[00:18:54] Speaker 02:
in the non-breach world.

[00:18:57] Speaker 02:
That's the problem.

[00:18:59] Speaker 02:
It's not as though the credits are gone.

[00:19:02] Speaker 02:
Correct.

[00:19:03] Speaker 02:
And there's no evidence as to what the credits are worth now, right?

[00:19:06] Speaker 00:
No, we don't.

[00:19:08] Speaker 00:
Outside of the record, there may have been sales, but there's nothing in this record, no, Your Honor.

[00:19:12] Speaker 00:
And to go to Judge Hughes' question, that our expert did apply into a price range, that would go to quantum.

[00:19:19] Speaker 00:
But before you get there, you need to have a transaction.

[00:19:24] Speaker 00:
We're aware of precedent that says you need to reach an effective price.

[00:19:28] Speaker 02:
If your expert said the credits are worth $30,000 and somehow they at least have to show that the credits are no longer worth $30,000 and they didn't put on any evidence to that effect, right?

[00:19:42] Speaker 02:
Right.

[00:19:43] Speaker 00:
They made a lost profits claim.

[00:19:44] Speaker 00:
It's based on a potential transaction and the transaction that they specified was a sale to the Alaska Railroad Corporation.

[00:19:51] Speaker 01:
I know this isn't before us, but I'm just curious.

[00:19:55] Speaker 01:
There was a reduction from roughly 160 credits to roughly 16, and then back up to roughly 30 or something, I think.

[00:20:04] Speaker 00:
It's not quite that simple in terms of pelestering credits, but yes.

[00:20:09] Speaker 01:
I take it all under the contract with the government for setting up this bank.

[00:20:14] Speaker 01:
Is there a process for challenging that reduction

[00:20:18] Speaker 01:
it within the agency, or is that just no longer an issue that everybody agrees the whatever number you have now left, which is lower than 160 is the right number?

[00:20:28] Speaker 00:
Well, I don't know that there's an administrative process, Your Honor, which may be what you're referring to.

[00:20:34] Speaker 00:
There certainly was and is, as far as I'm aware, an informal process of approaching the court.

[00:20:42] Speaker 00:
I mean, this is a much discussed issue in terms of the number of credits that will be

[00:20:46] Speaker 00:
deemed appropriate within a given bank, and that can go back and forth.

[00:20:49] Speaker 00:
And that did occur.

[00:20:51] Speaker 00:
So the pioneer, my friend here, pointed to our expert's testimony quite a bit.

[00:21:03] Speaker 00:
I don't think it does what he contends.

[00:21:05] Speaker 00:
And I'd just like to point the court, not necessarily read now, but append to 1650, 1651, our expert explains that

[00:21:16] Speaker 00:
What he's doing in developing his damages model or theory is assuming a breach to 160.2 credits, the full amount that the railroad needed for this permit.

[00:21:29] Speaker 00:
The trial court, as we explained in our brief and we explained it on pages 37 to 39, reached a more limited holding on a breach just to 124.7 credits.

[00:21:38] Speaker 00:
So a different chain of events occurs in the non-breach world in that instance.

[00:21:42] Speaker 00:
Out of the 160.2 total required,

[00:21:45] Speaker 00:
In the non-breach world, the railroad is directed initially to purchase 124.7 from Pioneer.

[00:21:51] Speaker 00:
The remainder, we can fairly assume, goes to Sukenik.

[00:21:57] Speaker 00:
Sukenik would charge $10,000.

[00:21:58] Speaker 00:
We then reached the exact same situation to the extent the railroad was not already aware that Pioneer's pricing was exorbitant.

[00:22:05] Speaker 00:
They would then have learned that Pioneer's pricing was exorbitant, and we move along the same path for 124.7 credits as we did for 16.92.

[00:22:14] Speaker 00:
key here in terms of my friend bringing up the sale to the elastic department of transportation.

[00:22:21] Speaker 00:
There's testimony from Mr. Lindemood of the railroad saying that he was astounded by Pioneer's prices.

[00:22:28] Speaker 00:
He found them ridiculous because he had just purchased 143 credits for $1.4 million, and Pioneer was attempting to sell 17 credits for approximately $2.5 million.

[00:22:41] Speaker 00:
I just want to touch quickly on

[00:22:43] Speaker 00:
The question of whether the trial court imposed the incorrect standard, I think it's clear from the opinion.

[00:22:48] Speaker 00:
And at one point, the court says that it was unlikely that the railroad would purchase Pioneer's credits.

[00:22:53] Speaker 00:
I think it's a clear indication that this proponents of the evidence standards as was proper.

[00:22:57] Speaker 00:
And finally, Pioneer points to the testimony of Lieutenant Colonel DeRocchi.

[00:23:02] Speaker 00:
That testimony only shows his opinion.

[00:23:04] Speaker 00:
It doesn't show anything about the chain of events that we've described, which would have led to the exact same result

[00:23:10] Speaker 00:
for 124.7, as for 16.92.

[00:23:13] Speaker 00:
And if there are no further questions.

[00:23:17] Speaker 00:
Okay.

[00:23:17] Speaker 00:
Thank you.

[00:23:19] Speaker 02:
Mr. Galli, you have a few minutes.

[00:23:24] Speaker 03:
Opposing counsel mentions Lieutenant Colonel Dorocki.

[00:23:29] Speaker 03:
During the trial, it came out that Lieutenant Colonel Dorocki at the time was the commander of the Corps Regulatory District up in Alaska.

[00:23:38] Speaker 03:
came out, he conducted an investigation to all the allegations involved here.

[00:23:43] Speaker 03:
After the investigation, he then admitted that the Corps breached the contract.

[00:23:51] Speaker 03:
Of course, the court made that for separate finding.

[00:23:54] Speaker 03:
And Lieutenant Colonel DeRocchi further admitted that that breach caused Pioneer to lose a $12.6 million sale.

[00:24:05] Speaker 03:
This is the man in charge of the regulatory division for Alaska.

[00:24:10] Speaker 03:
Him admitting the course breach caused the damages.

[00:24:14] Speaker 03:
If I was a defendant, personal defendant, and had breached a contract claim.

[00:24:17] Speaker 03:
Where exactly did he say that?

[00:24:20] Speaker 03:
Yes, sir.

[00:24:21] Speaker 03:
Page 624 through 625 in the appendix, reading specifically appendix page 625, starting at line 8.

[00:24:41] Speaker 02:
picks up where iraqi is talking about having made an investigation completed an investigation plus first of all it's not his testimony this is your witness for a time you should his admission but i don't see his admitting that you lost twelve point six million dollars are on the way to starting that way a lot of weight weight you can interrupt me you cannot interrupt me how much i think finished okay so what he seems to be saying is

[00:25:10] Speaker 02:
And I said, well, you realize the magnitude of what that meant to me, the sale I lost.

[00:25:15] Speaker 02:
And he said, yes, $12.6 billion, which can be read as saying, I recognize your view of what you lost, not that, in fact, I agree that you lost $12.6 million.

[00:25:28] Speaker 03:
I think the plain reading of this, Your Honor, is he's talking, DeRocchi has already told him that, admitted that the court had no authority to take away my credits.

[00:25:39] Speaker 03:
That's up front there.

[00:25:40] Speaker 03:
And then he says, well, you know what that meant to me?

[00:25:43] Speaker 03:
You know what that, taking away the credits, meant to me?

[00:25:45] Speaker 03:
The sale I lost.

[00:25:48] Speaker 03:
And DeRocchi then said to him, yes.

[00:25:49] Speaker 03:
He said, yes, you lost a $12.6 million sale.

[00:25:54] Speaker 03:
The judge admitted that in evidence.

[00:25:56] Speaker 03:
He says, well, I'm going to decide whether there's a breach or not.

[00:25:59] Speaker 03:
But the statement by DeRocchi, which was not challenged, not rebutted, that that action by the court, taking away the credits,

[00:26:08] Speaker 03:
cost caused Pioneer to lose a $12.6 million sale, we of course know.

[00:26:14] Speaker 03:
Causation of damages, calculation of damages, questions of fact, blue bonnet savings says that.

[00:26:20] Speaker 03:
The man in charge of the division says, yes, I know that this breach caused you to lose a $12.6 million sale.

[00:26:27] Speaker 03:
I think that's the common reading, the plain reading, of what this language is here.

[00:26:34] Speaker 03:
And if the defendant admits

[00:26:36] Speaker 03:
a breach, the defendant admits it caused Planner to lose a $12.69 sale, the court totally ignores that, of course, in his decision.

[00:26:46] Speaker 03:
And I think so, so again, the court's decision is contrary to that part of the evidence, the twofold.

[00:26:53] Speaker 03:
So any conclusion maintained on a number of fronts, the court's decision is contrary to the evidence.

[00:27:00] Speaker 02:
You can't... I think, Mr. Kell, we're about out of time.

[00:27:03] Speaker 02:
Okay, thank you.