[00:00:00] Speaker 03:
This is number 24, 2352, by Belize, LLC, versus United States.

[00:00:07] Speaker 03:
OK, Mr. Kozlov.

[00:00:11] Speaker 02:
Good morning, Artists and Athletes of the Court.

[00:00:14] Speaker 02:
The two strands of decisions by this Court that the parties refer to, the Alastair Addy strand and the Boise Cascade strand, they both involve a district court order.

[00:00:27] Speaker 02:
The question that the court has posed in these other cases is whether or not the plaintiff is seeking to ask the Court of Federal Acclaims to review the merits of that order, to assess the validity of that order on its merits, or not.

[00:00:44] Speaker 02:
In the Alastriotti cases, the court said the plaintiff was asking the Court of Federal Acclaims to review the merits.

[00:00:52] Speaker 02:
And the court said, as an Article I court,

[00:00:56] Speaker 02:
Court of Federal Claims has no jurisdiction to do that.

[00:01:01] Speaker 02:
That's reserved for the federal courts of appeals.

[00:01:04] Speaker 02:
In the Boise Cascade line of decisions by this court, the court said the plaintiff was not seeking to review the merits or assess the authority of the district court to issue the order.

[00:01:17] Speaker 02:
Rather, it was looking at the effect of the order.

[00:01:21] Speaker 02:
Did it affect a taking?

[00:01:25] Speaker 03:
help me here because as I read the district court order appointing the receiver, it had two grounds.

[00:01:33] Speaker 03:
One was 13B, which is no longer a valid ground in light of the Supreme Court decision.

[00:01:39] Speaker 03:
And the other one was to freeze funds to pay for the contempt sanction.

[00:01:49] Speaker 03:
And there's no showing that that second ground is invalid ground.

[00:01:55] Speaker 03:
How does it get you anywhere to show that one of two grounds is improper?

[00:02:00] Speaker 02:
Well, Your Honor, that second ground only applied to the principals, the three named individual defendants.

[00:02:08] Speaker 02:
It did not apply to my clients.

[00:02:10] Speaker 02:
They were not held in contempt.

[00:02:11] Speaker 02:
They couldn't have been because they didn't participate in the district before proceeding.

[00:02:14] Speaker 03:
It's the same property, right?

[00:02:15] Speaker 02:
I'm sorry?

[00:02:16] Speaker 02:
Same property.

[00:02:18] Speaker 02:
No, not same property.

[00:02:19] Speaker 03:
Not same?

[00:02:20] Speaker 02:
Why not?

[00:02:21] Speaker 02:
No, no.

[00:02:22] Speaker 02:
The FTC went after

[00:02:24] Speaker 02:
the assets of the individuals, and it went after the assets of the companies.

[00:02:29] Speaker 02:
The companies' properties were never the subject of the district court's order, because it was only the individuals who were held in contempt, not the companies.

[00:02:38] Speaker 02:
So the only order that was entered by the district court against the companies was an order under 13B.

[00:02:46] Speaker 04:
which you could have chosen to appeal to the Fourth Circuit and the Fourth Circuit if it agreed with you would have said you can't require the companies to place their property in the hands of the receiver and you'd have won.

[00:03:03] Speaker 04:
That seems to me to be a classic case of the district court being reviewable but by the Fourth Circuit not by the Court of Federal Claims.

[00:03:13] Speaker 04:
Why is this

[00:03:14] Speaker 04:
Why is that not exactly what we prohibit in cases like Alastria?

[00:03:20] Speaker 02:
Well, I agree, Your Honor, that we could have challenged the authority of the district court to enter that order.

[00:03:26] Speaker 02:
We chose not to.

[00:03:27] Speaker 02:
I fought that fight in the district court before Judge Macedi, and I lost.

[00:03:31] Speaker 02:
And we decided not to appeal to the Fourth Circuit on the question of the authority of the district court

[00:03:39] Speaker 02:
to enter an order requiring my clients to pay over money or to assume the responsibility.

[00:03:44] Speaker 02:
But what we didn't say to the court of claims in this case, we did not ask the lower court to review the merits or the authority of the district court to enter that order.

[00:03:55] Speaker 02:
We said, just as the plaintiff in Boise Cascade said, the effect of that order was to affect a taking under the Fifth Amendment.

[00:04:05] Speaker 02:
So we were not.

[00:04:06] Speaker 04:
But it was lawful.

[00:04:07] Speaker 04:
If what the district court did was entirely lawful, then there would be no taking.

[00:04:14] Speaker 04:
You would agree with that.

[00:04:15] Speaker 02:
No, I do respect.

[00:04:18] Speaker 02:
I don't agree with that, because that's the same thing that happened in Boise Cascade.

[00:04:22] Speaker 02:
The injunction was issued by the district court.

[00:04:24] Speaker 04:
The district court in this case, unlike the district court in Boise, all the district court did was to enter an injunction, which didn't result, at that point, in an actual taking.

[00:04:36] Speaker 04:
But here, the district court, as I understand it, took money from the companies and put it in the hands of the receiver.

[00:04:45] Speaker 04:
Isn't that the taking that you're contesting?

[00:04:48] Speaker 02:
We're not contesting the authority of the district court to do that.

[00:04:52] Speaker 02:
And in Boise Cascade, it was the injunction itself that the plaintiff of Boise Cascade asked the court of federal claims to review.

[00:05:01] Speaker 02:
It asked the court of the claims.

[00:05:02] Speaker 02:
It assumed the validity of the injunction as the

[00:05:06] Speaker 02:
As the court pointed out in Boise Cascade, the plaintiff was not challenging, did not appeal the injunction.

[00:05:12] Speaker 02:
Similarly, we did not appeal the order entered against us.

[00:05:16] Speaker 02:
But this court said in Boise Cascade, nevertheless, the mere existence of the injunction, a valid order not being challenged on its merits, affected a takings.

[00:05:28] Speaker 02:
And therefore, the Court of Federal Claims has jurisdiction to determine if the effect of that injunction, valid as it may have been,

[00:05:37] Speaker 02:
was it taking?

[00:05:37] Speaker 02:
That's what we're arguing here.

[00:05:38] Speaker 02:
We're not challenging.

[00:05:40] Speaker 02:
And I must say that in reviewing my briefs in preparation for this argument, I think my brief was not crystal clear on this point.

[00:05:48] Speaker 02:
We're not challenging the authority of the district court to issue an order against my clients to pay money over to cover the contempt against the principles.

[00:05:59] Speaker 02:
What we're saying is, even if

[00:06:03] Speaker 02:
I mean, I don't think the court had authority to do it.

[00:06:05] Speaker 02:
But I lost that fight, and we didn't appeal.

[00:06:08] Speaker 02:
But even if it's a valid order and the district court had full authority to issue it, what was the effect of that order?

[00:06:15] Speaker 02:
The effect of that order was a taking.

[00:06:17] Speaker 03:
You run into cases, putting aside Boise KSK, you run into cases that say if you have a remedy by appeal, you have to pursue that.

[00:06:27] Speaker 03:
And you can't just say this is a taking and ignore the remedy that would undo the wrong.

[00:06:32] Speaker 02:
Well, I think that Judge Bryson's maybe more optimistic than I would have been that the Fourth Circuit, if we had appealed, would have overturned it and said there was no authority.

[00:06:45] Speaker 02:
I think we made a calculated judgment to decide, was that a likely outcome in the Fourth Circuit?

[00:06:51] Speaker 02:
Had we taken that remedy of an appeal on the merits of the authority of the district court to issue the order, we decided not to.

[00:06:59] Speaker 02:
We decided we would probably have lost in the Fourth Circuit.

[00:07:02] Speaker 02:
But be that as it may, we did not forfeit our right to seek compensation or to make a takings claim in the court of federal claims.

[00:07:12] Speaker 02:
I could not.

[00:07:13] Speaker 02:
We could not have made that claim in the Fourth Circuit.

[00:07:16] Speaker 02:
I could not have argued to the Fourth Circuit that it was a taking.

[00:07:20] Speaker 02:
Under the Tucker Act, the Fourth Circuit would have no jurisdiction to decide that question.

[00:07:26] Speaker 03:
But your original complaint here didn't allege a taking, right?

[00:07:30] Speaker 03:
It alleged an illegal exaction.

[00:07:33] Speaker 02:
Well, the formulation I used was illegal exaction.

[00:07:38] Speaker 02:
But I think what we meant was an illegal exaction by the combination of the FTC's action and seeking it

[00:07:46] Speaker 02:
And the district court's granting it.

[00:07:49] Speaker 03:
But if we confine you, if we said, no, your complaint didn't allege a taking, you just alleged an illegal exaction.

[00:07:57] Speaker 03:
This isn't an illegal exaction, correct?

[00:07:59] Speaker 02:
Correct.

[00:08:02] Speaker 02:
But it is a taking.

[00:08:03] Speaker 02:
And I think that, and also, this court pointed out in Boise Cascade, the difference between the Boise Cascade line and the Alistair Audie line of cases, the governor was not an impartial arbiter here.

[00:08:17] Speaker 02:
standing on the sidelines, the FDC asked the district court to issue this order.

[00:08:24] Speaker 02:
It wasn't there in the first place.

[00:08:26] Speaker 02:
It wasn't in the original order.

[00:08:28] Speaker 02:
The FDC went back to the district court after the Fourth Circuit's decision and said, fix this.

[00:08:34] Speaker 02:
Fix this problem, because we forgot that the assets of the companies were not touched, couldn't have been touched, because they could have been held in contempt.

[00:08:43] Speaker 02:
So change your order and issue a new order

[00:08:47] Speaker 02:
To take their money, too.

[00:08:48] Speaker 02:
That's the taking.

[00:08:50] Speaker 02:
That's the taking.

[00:08:51] Speaker 04:
Well, if that's the taking, that's exactly the taking that the Fourth Circuit presumably could have overturned.

[00:08:58] Speaker 04:
I don't believe it.

[00:08:59] Speaker 04:
You say that's the taking.

[00:09:00] Speaker 04:
Yeah.

[00:09:01] Speaker 04:
And that was the order entered by the district court.

[00:09:04] Speaker 04:
Why could the Fourth Circuit not simply say reversed, give the companies the money back?

[00:09:11] Speaker 02:
They might have done that, as I said.

[00:09:12] Speaker 04:
And that would overturn the taking.

[00:09:14] Speaker 04:
What you've characterized as a taking.

[00:09:17] Speaker 02:
They couldn't have addressed it as a taking.

[00:09:19] Speaker 04:
Let's not use, forget the nomenclature.

[00:09:23] Speaker 04:
You would have gotten your money back, right?

[00:09:28] Speaker 02:
I think we would have lost.

[00:09:29] Speaker 04:
Well, you probably would have lost.

[00:09:31] Speaker 02:
Right.

[00:09:32] Speaker 04:
But if you had a good case and if the Fourth Circuit heard your case, dealt with your arguments fairly, you

[00:09:41] Speaker 04:
You say you had good arguments.

[00:09:43] Speaker 04:
You would have gotten your money back, if you want.

[00:09:47] Speaker 02:
We had to make a decision.

[00:09:49] Speaker 02:
We had to make a strategic decision.

[00:09:50] Speaker 02:
Oh, OK.

[00:09:51] Speaker 02:
Do we go to the Fourth Circuit and try to get our money back by arguing against the validity or the authority of the district court, or do we claim it was a taking?

[00:09:59] Speaker 02:
So we didn't flip a coin, but we made an assessment that the better choice, I made it, for my clients, the better choice was to seek

[00:10:09] Speaker 02:
in the court of federal claims to make a takings claim, not to challenge the authority of the district court because we think, I think, we would have lost in the Fourth Circuit.

[00:10:18] Speaker 04:
Do you have, you mentioned a couple of times the Boise Cascade line of cases.

[00:10:23] Speaker 04:
What other cases are there in that essentially say the same thing, Boise Cascade?

[00:10:30] Speaker 04:
Because I'm aware of the, you know,

[00:10:34] Speaker 04:
the cases that go the other way.

[00:10:36] Speaker 04:
I was not aware of any other than Boise Cascade that goes the way Cascade goes.

[00:10:40] Speaker 02:
There aren't any in this court, but they were in the Court of Federal Acclaims.

[00:10:44] Speaker 02:
We cited them in our brief.

[00:10:46] Speaker 02:
Okay, but none in this case.

[00:10:47] Speaker 02:
None in this court.

[00:10:48] Speaker 02:
In this court.

[00:10:49] Speaker 02:
Right.

[00:10:50] Speaker 02:
It's on page 24 of my brief.

[00:10:55] Speaker 02:
Colonial Chevrolet and allies of Kingsport versus United States, two federal claims court's decisions that were issued following Boise Cascade and following that same logic, following that same theory, that you can have a valid order when you're not challenging its merits.

[00:11:13] Speaker 02:
You're not asking the court of federal claims to challenge or to review the merits.

[00:11:17] Speaker 02:
You're saying, I agree it's a valid authoritative order.

[00:11:22] Speaker 02:
it affected a taking.

[00:11:23] Speaker 02:
In fact, it's hard to conceive of a judicial taking where that wouldn't be the case.

[00:11:27] Speaker 02:
It's always going to be the case that if you have a judicial taking, which the Supreme Court and this Court have recognized, it's almost impossible to imagine a situation unlike that wouldn't be just like this case, where you're not challenging the validity, you're not challenging the authority, but you're saying that decision, that district court order, affected a taking.

[00:11:53] Speaker 02:
Because of that, I think this is a paradigm case to fit within the Boise Cascade decision and that line, not only because we're not challenging the authority of the district court,

[00:12:07] Speaker 02:
We're not challenging whether it was a valid order.

[00:12:10] Speaker 02:
We're not asking.

[00:12:10] Speaker 02:
We didn't ask the Court of Federal Claims to review the merits of that order.

[00:12:14] Speaker 02:
What are we saying?

[00:12:15] Speaker 02:
Granted, it's authoritative.

[00:12:16] Speaker 02:
Granted, it's valid.

[00:12:18] Speaker 02:
Nevertheless, it affected the taking.

[00:12:20] Speaker 02:
And that's something that this Court of Federal Claims does have jurisdiction to review.

[00:12:25] Speaker 02:
Now, the government also says even if there was jurisdiction, there was a lack of a cognizable claim.

[00:12:33] Speaker 02:
That's not true.

[00:12:33] Speaker 02:
They say because the Fourth Circuit

[00:12:36] Speaker 02:
adjudicated this question.

[00:12:37] Speaker 02:
The Fourth Circuit never adjudicated this question.

[00:12:40] Speaker 02:
We didn't appeal.

[00:12:41] Speaker 02:
We weren't party to the Fourth Circuit's decision.

[00:12:44] Speaker 02:
So that was never resolved by the Fourth Circuit.

[00:12:48] Speaker 03:
What would your argument have been before the Fourth Circuit if you had appealed?

[00:12:52] Speaker 02:
My argument would have been, as Judge Bryson says, that the district court had no authority to issue an order against my clients because they were not held in contempt.

[00:13:02] Speaker 02:
And the only order that was issued against my clients was under 13B in a unanimous Supreme Court said that's not valid.

[00:13:08] Speaker 03:
But it was an order for receivership of a particular property, right?

[00:13:11] Speaker 03:
I'm sorry?

[00:13:12] Speaker 03:
It was an order for receivership with respect to a particular property, right?

[00:13:17] Speaker 02:
It was an order to turn over to the receiver all their assets and property.

[00:13:21] Speaker 03:
So the issue on the Fourth Circuit would have been who owned the property?

[00:13:25] Speaker 02:
Well, there were two different sets of properties, as I said, Your Honor.

[00:13:28] Speaker 02:
There was the property of the individuals,

[00:13:30] Speaker 02:
And we're not representing them.

[00:13:32] Speaker 02:
It was the property, separate property, separate assets owned by the companies.

[00:13:38] Speaker 02:
And the FTC, realizing they had a problem, said, OK, we've got protection from the Fourth Circuit for the property of the individuals.

[00:13:46] Speaker 02:
We forgot about the assets and property of the companies.

[00:13:50] Speaker 02:
So please, district court, enter an order as to them.

[00:13:53] Speaker 02:
That's what was in the district court's order.

[00:13:55] Speaker 02:
He ordered that they turn over their assets, their separate assets and properties.

[00:14:00] Speaker 03:
Yeah, okay.

[00:14:02] Speaker 03:
I'm going to save the rest of your time.

[00:14:03] Speaker 03:
Yeah, please.

[00:14:06] Speaker 03:
Mr. Phillips?

[00:14:07] Speaker 01:
Thank you, Your Honor.

[00:14:09] Speaker 01:
May it please the Court?

[00:14:10] Speaker 01:
The Court of Federal Claims properly dismissed this illegal exaction claim for lack of jurisdiction, and that decision should be affirmed.

[00:14:16] Speaker 01:
Now, we've had a lot of discussion today about whether this is a takings or an illegal exaction claim.

[00:14:22] Speaker 01:
Your Honors are correct.

[00:14:23] Speaker 01:
This was brought as an illegal exaction claim, which presupposes

[00:14:26] Speaker 01:
that there is some illegality in the action of the district court here.

[00:14:30] Speaker 01:
That illegality is something that could not be reviewed by this court because that establishes, in the Alice Duarte line of cases, that this court cannot look at the propriety of the underlying Article III court's decision-making.

[00:14:45] Speaker 01:
And there is no path here

[00:14:47] Speaker 01:
under House was alleged where this court would not have to address the actual propriety of the district court's decision through the turnover order of requiring these assets go to the receivership to pay for the contempt judgment.

[00:14:59] Speaker 01:
Your Honour did discuss there was this 13B claim and then the contempt order and the Fourth Circuit has reviewed all this.

[00:15:08] Speaker 03:
Help me understand what the property is.

[00:15:12] Speaker 03:
As I understand, Mr. Kessler, he's saying there's some property that was owned by the individuals and some that was owned by the corporation.

[00:15:21] Speaker 03:
Is it the same property with a dispute about who owns it?

[00:15:24] Speaker 03:
What's going on?

[00:15:25] Speaker 01:
As I understand, Your Honor, from the district court's decision, and this is in 42 F sub 3rd, 373, and this is sort of a general consideration there,

[00:15:35] Speaker 01:
The entities were so intertwined that all the property was considered by the district court to be property of the combined entity, both the individual and the entities, because the individual, Mr. Puckey and the other two people, were controlling everything.

[00:15:48] Speaker 01:
So I don't understand there to be a distinction, a specific distinction, about any property.

[00:15:54] Speaker 01:
But more importantly, that would have been an issue dealt with by the district court and should again be dealt with by the district court of the Fourth Circuit.

[00:16:01] Speaker 00:
So it would have been appealed to the Fourth Circuit.

[00:16:03] Speaker 01:
It would have been appealed to the Fourth Circuit because this was the subject matter of what was going on in the district court in the sanctuary Belize litigation.

[00:16:12] Speaker 01:
And as we've heard, there was a choice not to appeal that second decision after it had gone up to the Fourth Circuit and was vacated in part and remanded back.

[00:16:23] Speaker 01:
The district court then addressed again

[00:16:25] Speaker 01:
whether the contempt order could stand, and the assets could be provided at the receivership, and address that as far as the individuals went.

[00:16:32] Speaker 01:
The Bibleese entities, which were controlled by the individuals, chose not to take that route, chose to do this sort of end run, this collateral attack in this court, by suggesting that their challenge to the district court's determination, the turnover order, should be considered something different.

[00:16:50] Speaker 04:
So if I understand it then, the

[00:16:54] Speaker 04:
One of the contested issues in the district court was whether the assets were so integrated between the individuals in the company that the assets could fairly be moved over to the receiver in order to deal with the consequences of the contempt judgment.

[00:17:11] Speaker 01:
As I understand it, yes, Your Honor.

[00:17:12] Speaker 04:
All right.

[00:17:13] Speaker 04:
And that would be an issue before the Fourth Circuit if there had been an appeal.

[00:17:18] Speaker 04:
And it would also necessarily be an issue, would it not,

[00:17:23] Speaker 04:
the Court of Federal Claims had reached the merits.

[00:17:27] Speaker 04:
Wouldn't the Court of Federal Claims have had to decide whether or not that property was in fact properly characterized as property of the individuals?

[00:17:37] Speaker 01:
Yes, Your Honor.

[00:17:38] Speaker 01:
If the Court of Federal Claims had asserted jurisdiction in this case, they would have had to

[00:17:41] Speaker 01:
effectively reweigh the same determination that the District Court and then the Fourth Circuit was looking at.

[00:17:47] Speaker 00:
I was just going to say that's because of the illegal ex-action nature of the claim brought, right?

[00:17:55] Speaker 01:
Yes, Your Honor, because the illegal ex-action nature of the claim, and this is one of the distinctions this Court knows between takings and illegal ex-action, I think we were getting at.

[00:18:02] Speaker 01:
Taking is supposed to be a lawful action.

[00:18:06] Speaker 01:
And illegal ex-action, on the other hand, suggests that the government

[00:18:09] Speaker 01:
somehow did something outside of its authority in the law.

[00:18:12] Speaker 01:
So by characterizing this as an illegal ex-action claim, we are at the situation where this court or the Court of Federal Claims has to address the propriety of the action taken here, which was the district court ordering the assets through the turnover order go to the receiver.

[00:18:28] Speaker 03:
Was there also an issue as to whether the corporations were subject to the contempt finding?

[00:18:34] Speaker 01:
I believe it was discussed there, Your Honor, but the opposing counsel is correct that the contempt finding did not go specifically to the entity corporations like Bible East, but the other finding by the district court was that these entities were so intertwined that there was no practical difference.

[00:18:51] Speaker 01:
So the district court did address this, and this was addressed.

[00:18:54] Speaker 01:
I believe there was some discussion in the first PACA decision at the Fourth Circuit.

[00:18:59] Speaker 01:
I don't recall.

[00:18:59] Speaker 01:
I can search, Your Honors, if it was discussed again at length in the second PACA decision.

[00:19:04] Speaker 01:
But this was all before the district court in Maryland and then was appealed up to the Fourth Circuit, which is why we've stated in our brief there is no path for this court to address that does not require this court or the court of federal claims in the first instance to actually look

[00:19:19] Speaker 01:
at the priority of the district court's order turning over these assets to the receivership.

[00:19:26] Speaker 01:
But even if there were jurisdiction here, there would still be the issue of collateral estoppel for all the same reasons we're talking about.

[00:19:34] Speaker 01:
All these issues have already been addressed by the Fourth Circuit or the district court

[00:19:38] Speaker 01:
through the turnover order.

[00:19:39] Speaker 01:
So there's nothing left for this court to do that would be different.

[00:19:42] Speaker 01:
We would have a second court reweighing the same evidence and potentially, in this case, coming to a separate or different conclusion.

[00:19:50] Speaker 01:
And also leading to sort of an odd result here, where the Bibleese entities have stated in the reply brief, what they're looking for is this court to say that this was an illegal exaction.

[00:20:01] Speaker 01:
The district court's requirement to turnover

[00:20:04] Speaker 01:
the assets, the receivership, and then return that same amount of value, $120, to these plaintiffs so they can then pay the contempt judgment.

[00:20:12] Speaker 01:
What that is doing is saying that they no longer, either the individuals or the entities, have to pay the contempt judgment.

[00:20:18] Speaker 01:
But the government has to now fund, through an illegal ex-action claim, the money that's going to be paid to cover that contempt judgment.

[00:20:28] Speaker 01:
And unless the court has other questions, I think we stand on our briefs.

[00:20:32] Speaker 03:
OK, thank you.

[00:20:34] Speaker 03:
Mr. Koslow?

[00:20:39] Speaker 02:
May I please report?

[00:20:41] Speaker 02:
First, this is again on Judge Dyke's point about whose answers are we talking about.

[00:20:46] Speaker 02:
On November 17, 2022, which is two weeks after the Fourth Circuit's first decision, the FTC went back to the Fourth Circuit and said, wait a second, if you

[00:20:59] Speaker 02:
Nullify under 13 be just the portion of the orders which were entered against the individuals and you don't touch the if you meant to also vacate the judgment against the companies the status of the money I'm quoting out from page 2 of the FTC's motion for clarification or alternative alternatively petition for rehearing and bank filed on November 17th 2022 in the Fourth Circuit

[00:21:26] Speaker 02:
And they said, because significant assets held by the receiver for redress to the victims of the appellant's fraud came from the defaulting companies.

[00:21:36] Speaker 02:
And then on the next page, page three, the FTC said, what's going to happen if you don't change your order, or if you actually meant what you said, that 13B

[00:21:46] Speaker 02:
requires the vacature of the order against the individuals, then the companies are going to go back to the district court and they're going to say, give us our money back.

[00:21:55] Speaker 02:
So it's clear that there were two sets of assets and property involved.

[00:21:59] Speaker 02:
One for the individuals, the three individuals, and separately for the companies.

[00:22:03] Speaker 02:
And that's what the FTC was worried about.

[00:22:05] Speaker 02:
They did not have, they had nothing in the district court's order which would have protected them

[00:22:10] Speaker 02:
from letting the companies get their money back.

[00:22:14] Speaker 04:
And their concerns were put to rest by the district court later entering an order, I take it, that put that money back into the hands of the receiver.

[00:22:23] Speaker 02:
Not the money from the individuals.

[00:22:25] Speaker 04:
No, no, I understand that.

[00:22:26] Speaker 04:
But they were concerned, you say.

[00:22:28] Speaker 02:
They were concerned.

[00:22:28] Speaker 04:
That the companies would hold on to their funds.

[00:22:31] Speaker 02:
Right.

[00:22:31] Speaker 02:
So the Fourth Circuit.

[00:22:32] Speaker 04:
Which the district court

[00:22:35] Speaker 02:
resolved in the FTC stage.

[00:22:42] Speaker 02:
the FTC's motion for clarification, meaning they did intend to say that the only order against the companies which was under 13B was vacated.

[00:22:52] Speaker 04:
Well, that gives you an even stronger argument, or would have, in the Court of Appeals, if you're right about that, of saying that the district court disregarded the mandate.

[00:23:03] Speaker 04:
And you could have gone to the Fourth Circuit.

[00:23:06] Speaker 04:
I'm having a hard time seeing what relief

[00:23:08] Speaker 04:
that you couldn't have gotten from the Fourth Circuit that you think you were entitled to get from the Court of Federal Claims.

[00:23:14] Speaker 02:
Well, I did make that argument back to the District Court.

[00:23:16] Speaker 02:
I said exactly that.

[00:23:18] Speaker 02:
All right.

[00:23:18] Speaker 02:
And the District Court disagreed with me.

[00:23:21] Speaker 02:
I lost that fight.

[00:23:22] Speaker 04:
Which gave you a one-way ticket to the Court of Appeals, it seems to me.

[00:23:26] Speaker 02:
Right.

[00:23:26] Speaker 02:
It did.

[00:23:27] Speaker 02:
But in my assessment, we would have lost that fight.

[00:23:30] Speaker 02:
And we had a better argument, I think, to make to the Court of Federal Claims that this order was a

[00:23:36] Speaker 02:
taking.

[00:23:37] Speaker 02:
And that's what we say that just the Court of Federal Acclaims had jurisdiction to consider now.

[00:23:43] Speaker 02:
The government says, no, that was already resolved by the Fourth Circuit.

[00:23:45] Speaker 02:
It was not.

[00:23:46] Speaker 02:
The Fourth Circuit never reached that issue.

[00:23:48] Speaker 02:
Couldn't have.

[00:23:49] Speaker 03:
Your original complaint was limited to an illegal exaction.

[00:23:53] Speaker 03:
Why should we allow you to argue at this point that you should be allowed to assert a takings claim that was never in the complaint?

[00:24:01] Speaker 02:
Well, the illegal exaction which we argued in our complaint was an illegal exaction

[00:24:07] Speaker 02:
caused by the FTC's going to the district court to get this order.

[00:24:11] Speaker 02:
So it was inartful pleading on my part, perhaps.

[00:24:15] Speaker 02:
And in a previous life, if I had submitted such a thing to the SG's office, Judge Rice would have not been pleased with that.

[00:24:22] Speaker 02:
But the fact of the matter is, it was basically the same thing.

[00:24:26] Speaker 02:
I didn't use the term judicial taking, but it was an illegal transaction in the sense that the FTC went back to the court and said,

[00:24:35] Speaker 02:
Please enter this order for our benefit.

[00:24:39] Speaker 02:
That was a taking.

[00:24:40] Speaker 02:
OK.

[00:24:42] Speaker 03:
Thank you.

[00:24:42] Speaker 03:
Thank both counsel.

[00:24:43] Speaker 03:
The case is submitted.