Podcast #89: $RENN is Chris DeMuth's best idea for 2022

Chris DeMuth discusses RenRen (RENN) and why it’s his best idea for 2022. You can find a lot of background on RENN in my original RENN podcast with Ian Bezek from April 2021, but since then RENN has announced a settlement to their big lawsuit. In December, a judge denied the settlement and argued shareholders from 2018 should get the proceeds; Chris explains why he thinks this ruling is wrong and why it’s likely to be overturned on appeal.

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Disclaimer: Nothing on this podcast or on this blog is investing or financial advice; please see our full disclaimer here. The transcript below is from a third party transcription service; it’s entirely possible there are some errors in the transcript!

Transcript begins below

Andrew Walker: Alright. Hello and welcome to the Yet Another Value Podcast. I'm your host Andrew Walker. With me today, I'm excited to have the first podcast of the year, my friend, my partner at Raising Capital, Chris DeMuth coming on. Chris, how's it going?

Chris DeMuth Jr.: Great. Nice to be here in Andrew.

Andrew: Great. Awesome to have you on for the first time, though you and I do have some experience podcasting together. Let me start this podcast the way I do every podcast. First, a disclaimer to remind everyone that nothing on this podcast is investing advice. That's particularly true today, we're going to be talking about security that we both think is asymmetric, but both of us think it is also highly risky. We have a significant position in it, so everyone should remember that a lot of the value here rests on a legal case. Chris and I stayed at a Holiday Inn once, but we're definitely not lawyers. So, you know, please remember, not investing advice. We're not lawyers. Please do your own work, please do your own due diligence. Not investing advice.

That out the way, let me turn to the second way I start every podcast. A pitch for you, my guest. It's a little unfair to give you a pitch since we work together, but I'll give you a little one that's a little off the beaten path. We've known each other for a long time, but I like seeing myself as pretty driven and I can honestly say, I don't know anyone who puts their mind to something like you do, you know? I remember in 2017, we started working out together. I don't think you'd ever squatted before and 6 months later, you were full whole 30 going to CrossFit every morning while training for an ultramarathon. People can see a photo of you now versus 5 years ago. The before-and-after is crazy. I just really admire the way you can put yourself up into everything you do.

All right, that all out the way. Let's turn to the soccer[?] and talk about it. The company is Renren. The ticker is RENN. This is the second time I mentioned Renren on the podcast. People can go back to the original podcast with Ian Bezek. I'll include it in the show notes for some background, but really interesting stuff has started there. Chris mentioned this is his best idea for 2022, I'll include a link to that in the show notes as well. All that out the way, Chris. Why don't we do a very fast background on Renren, and then we'll say everything that's happened since the Ian podcast, and kind of get people up to speed?

Chris: Sure. I mean I would recommend people just listen to that podcast that wants to be kind of get the version up into the point where we picked up on it. This was a Chinese College focus social media site. They kind of played it up as the next Facebook. My history of companies that say, "They're the next such and such," is that they've almost never been the next such and such. I was friendly with the guy who started Warby Parker and we joke back and forth. I send them every single time I see the next Warby Parker, that was like the kind of tagline for a while for everybody starting anything. These guys were not the next Facebook, but they quickly pivoted into the reason bunch of capital. They became kind of VC like in just investing in all sorts of stuff.

The one thing that really hit was SoFi. It was this Thin-Tech company that has then subsequently become famous as a SPAC[?] target that Despec[?] is now trading publicly and trading pretty well. It's one of the few SPACs right now trading well above its SPAC price. And that, not only raised a bunch of capital for-- It kind of revealed the capital. So, this was something that they had, early on, put a big investment in. They spun it off and did it in a way that was preferential, that was excluded the long-term shareholders of Renren from the upside of a lot of the things they were doing, especially this one. Shareholders then, on behalf of the company, sued in derivative litigation sued, and that has been going on for years. This is kind of 2018, '19, '20, '21, but then a lot happened since then. A lot...

Andrew: Chris, if I can just interrupt for one second. So if we pause the story right here, everything Chris said was the background. Everything Chris said was what we talked about with Ian Bezek in the first Renren podcast. So I think you could pause the story right there. Go listen to the first podcast, that's everything we're talking about. Now, everything I think Chris is about to say, going forward is kind of subsequent developments that have happened that have gotten us so interested. I just wanted [crosstalk].

Chris: So there's a 30-minute version of this. Listen to that. That's the kind of 30-second version. Two things really caught my eye in the process that made this kind of nonlawyer, but a person who likes to think about the game theory around this. Very interesting and very relevant today. One is when the defendants, and who exactly the defendants are, and who the plaintiffs are is a little confusing. Think about it as the founding manager and directors that were in charge of this decision. Then there's a couple of very, very powerful, deep-pocketed, influential, reputable, co-defendants that make the game theory very interesting here.

Two things happened: one was they tried to throw out the case, as you often do when you were the defendant. This is in state court in New York. That was bumped up through the appeals process and the plaintiffs, which are the group of current shareholders on behalf of the company, suing on behalf of Renren, was affirmed as the correct plaintiff by the Appellate Court. Put a pin in that, I'm going to come back to that in a second. That was very, very important in terms of just setting the chessboard that we're looking at today. The other thing that was very important in terms of the chessboard, in the game-theoretic dynamics, is something that's hard to get, but that this judge gave us which was attachment. An attachment that says that if there is a defendant, and in the process of something there might have been a fraud, there might have been-- It's not stipulating are accusations yet, but there's enough potential for a judgment.

And we're talking about liquid tradable securities, that they basically attached to these securities in this lawsuit. Somehow, they were able to slip them to somebody else and kind of hide, out in China or something. We have these securities, they're in escrow. The amount is quite significant. Just, in very rough terms, half a billion dollars. $500 million dollars and we might end up with zero. We might end up with all of that if the suit goes to its logical conclusion. That really affects the game here whether or not we win or lose. That's a big, big part of it. If so, we entered this with an appeals process that had once affirmed the current plaintiffs. And secondly, we are arguing over an amount of money that is attached or available in escrow for us to get. So, we don't have the potential to win against somebody who's hiding out in a country without the same kind of rule of law that we do, or we couldn't get them. And so that for me, those two things were kind of necessary for me to get the level of interest that I have now.

Andrew: And if you think back to the original podcast, one of the key questions I had for Ian was, hey, you know, there's tons of Chinese companies, because Renren is a Chinese company. [crosstalk] There are tons of Chinese companies that have, I never want to use the F-word on this podcast, but if you know-- Kind of harmed minority investors, and one of the issues is, if you're an American suing, you're going into China-US court. Here it was, the assets are in the US, SoftBank[?] independent. And as you said, that attachment was so big because you froze $500 million worth of assets, mainly SoFi shares, but $500 million worth of assets. That attachment was so big.

Chris: If you're talking to somebody and they say, you might have a good point, that I have a 10-million-man army, and my brother-in-law's a general, come and get it. Either that's an argument that I have a hard time overcoming.

Andrew: So that takes us through a lot of the case. Let's talk about what happens in October and then what happens in December.

Chris: So in October, we slid in to October with extraordinarily favorable negotiating dynamics for the couple reasons that I mentioned. This is the correct set of plaintiffs and they have money that is now attached and in escrow. So, everybody on the defense side was heading towards a settlement. Nobody had even... Nobody's even acting brave and saying, come and get us, you know, we think we're innocent. So, the number that was going to be somewhere between 500 and 0 was kind of... There was some equilibrium, call it somewhere around 250 million. And that was supported, more or less, in a pretty friendly fashion. The SoftBank and Duff & Phelps, were two of the kind of involved on the defendant's side, and we're having daily meetings to go over potential settlement. So, this is something that big powerful interests were pushing towards.

One of the founder member defendants is actually a SoFi board member. He has more economics and interest in the SoFi direction of his career than in Renren. I mean, just everybody on the defense side was looking towards, in terms of the agency issue, their career, their reputation, just putting this to bed. They were going to get liquidity out of any settlement, anything less than 100% of what was put in escrow. So, the money was unavailable to anybody and would be available in some combination of the defendants and plaintiffs once things could work out. Then in early October, there was a settlement announced. $300 million that would be divided[?] both accounted for for tax and it would actually go to-- the company would go to the non-defendant shareholders, and that was put out publicly and supported unanimously by everybody directly involved.

Andrew: Yup. So, I'll just pause there to get some number. So people can go pull up RENN stock price, right? And you can see in October, the shares skyrocket from 10 to 25 or 30 because this settlements announced. It's a $300 million settlement as Chris mentions, probably pretty good for the defendants because there was a $500 million attachment. So, you do a $300 million attack settlement, 500 minus 300, $200 million of liquidity freeze up out of nowhere, right? So, kind of works for everyone. It shows that, clearly, the defendants were pretty worried about this, they settled it. Minority shareholders, you know, the $300 million, it works out to about $25 or $30 per share because it's only going to minority shareholders. So, I think that October and at that point, I think everyone kind of evolved in thought, "Okay, great. We're just waiting on the cash to hit our accounts." But let's fast forward to what happens in December.

Chris: It's actually an important point that that was what the market, more or less, unanimously was priced in, both in the equity market and the options market. And just for laying out the chess board here, I'm using five and you can do the arithmetic. Although, it's not something that otherwise have any interest in owning, but call it five dollars of residual value which because this is coming out of this dividend, we're going to end up one way or another. The only question is, do we get paid a $26 to $28 payment in the interim? A disaster loss scenario is no, you just trade down to five or so. A successful scenario is we are distributing 26 to 28, and then you're left with 5. And then, it's 5. Give or take, 2. I mean, it's not an important part of the case.

Andrew: And just to clarify, Chris is talking about outside of this legal settlement, which is the reason everybody's interested Renren. Renren, they do have some assets, they have some small SaaS businesses, they've got a little bit of a steak and a Chinese vehicle distribution, some cash on the balance sheet. Maybe it's worth 5, maybe it's worth 3. It's not worth zero is what he's saying. [crosstalk] There's a little stub value. So, let's fast forward to what happens in December.

Chris: That's just for clarifying for cold reading what the markets, the open market, probabilities, and discounting. So then, we're dealing with a mid-20s settlement value with some residual value on top of that. The defendants are happy. The plaintiffs are happy. The shareholders are happy. And there's a lot of logic to it. I think if this went to a decision, it's reasonably likely that the plaintiffs would win. There's a little, tiny bonanza scenario where you could imagine where you'd actually win, not just the attachment, but you would win being awarded the actual equity, which would be not half a billion dollars but billions of dollars. I mean, you could have a couple, there were some tail risks for the defendants that are conceivable. Unlikely, but possible, that actually just...

Andrew: That's, you know-- I don't remember the exact numbers, but if Renren own 10% of SoFi and the Judge you're in the settlement with just said, "Hey, instead of paying 10% of SoFi at 2018 fair value prices, we're just going to distribute that. We're going to take those chairs back and distribute it." And obviously go look at SoFi stock price, the SPAC, and all that. Those are worth way more than they were back then. So, that would be your bonanza upside, that the defendants would be really worried about.

Chris: In thinking about it from a game-theoretic perspective It's not just that we could make that, but we're interacting with people who could lose that, and then maybe their lives would be ruined at that point financially, in a way that they wouldn't with these kinds of medium[?] scenarios. But so, they have this little bit of tail risk, and then they have the likelihood of just losing in court. It would be more public. The trial discovery process would not be highly flattering to them. So, the $500 million, a very bad scenario for them would be to have more negative externalities. So 300 was, you know, you're settling not half and half, but it's saying the defendant is probably going to lose and they probably agreed in... The plaintiffs were probably going to win and they agreed, and they split the difference in a way that had a lot of reason to it for everybody. And that's where we were through October. The last part of the process is it has to be approved by the court.

And then drumroll, the judge, and this is a judge who had been, I think by most people's view including mine, pretty skeptical of the defendants throughout the process. I mean his verbiage both in attaching the securities and his verbiage in denying the case getting thrown out, which was then on appeal affirmed, to me sounded... I would be, if I were on the defendant's side, quite uncomfortable with this judge in his behavior towards the defendants. A hearing that was publicly available, you know, like in this era, a zoom call. His tone seemed to have shifted pretty dramatically when he came into the hearing to review this settlement. He came down kind of almost immediately very, very hard on the shareholder derivative lawyer. He was very unhappy with the lawyers' fees, a third of the 300 million. 100 million according to Fast Math. The judge was quite unhappy with that and basically said it had to be much less. The judge was very unhappy with his view. That a fair and just outcome would be that this harm is done.

This thing, we can call it fraud at this point, was done and it should go to the shareholders, at the time, that was damaged. It shouldn't go to this set of shareholders now. And maybe in terms of atmospherics, it could be impacted or his view or a view might be impacted by the fact that these are opportunistic hedge funds who are seeking out this scenario. The results of this scenario is opposed to people who had stumbled into these risks and these rewards.

He seemed unhappy about the whole thing and so said, "I would not approve the settlement and I would not approve the settlement that didn't have a record date of the time in 2018 when the shareholders were harmed." The judge spoke these words that the lawyers were clearly surprised and thrown off by this. And then, he put out an order consistent with his reaction in the hearing, and then subsequently, the derivative suit, our lawyers have appealed this now. The verbiage in New York is slightly confusing. So this is all under Cayman law. This is all being done in the New York Court, which is a little unusual.

Corporate law in the US is mostly in Delaware. New Yorkers certainly don't think of it this way. As a kind of second-tier Backwater, but in corporate law, it's not as common. So if you're dealing with the chancellor in Delaware, a lawyer and a chancellor would be back and forth on an issue where those two individuals have discussed it a hundred times, and that they've written what is considered to be American corporate law. At the state level in Delaware where other states peek at it and so forth. This is the Wild West in terms of how judges and lawyers interact, but it was appealed. And after the appeal, the judge has now been kind of shooting every few days, subsequent, explanatory orders, which is not procedurally the norm at all, because it's already been appealed. It's just doubling down on his original attitudes without as much precedent cited, as you would normally expect from a judge in a legal proceeding. [crosstalk] And that gets us to today.

Andrew: Yup. So, let's back up a bit. And again, anyone can pull up the stock price and you're going to see this pretty quickly, right? Heading into December, the shares are at 25, 26, or something. And then, I can't remember the exact date, but on a Friday or Thursday, the judge comes out of nowhere and says, "No, I'm not going to approve that." The issue was the settlement was going to current shareholders and he says, "No, these aren't the people who were harmed. The people who were harmed were the people who own the stock back in 2018 when these deals and these transactions happened. So I will only approve the settlement if it's going to the people back in 2018. And by the way, the lawyers' fees need to come down." And you can see the stock goes from, you know, 25 to about 10, because people are saying, "Oh my God, like, this isn't coming to us." And now it's probably set around 15 or something, but that's the Crux of the issue, right?

The Crux of the issue is the current plaintiffs are appealing, current shareholders which include us, are appealing. And they're saying, "Hey, we think this judge is wrong. We think the payout should go to current shareholders, not former shareholders." And the judge is putting out orders, as you said saying, "Hey, this is why it should go to former shareholders record date of April 2018," I believe. So go ahead, quick.

Chris: I was trying to make sure I bracket things in terms of how bad it could be, how good it could be, just setting aside the probabilities for a second just to understand literally what this would mean. You and I owned zero shares in 2018. I guess, that's a disclosure. I'm just disclosing that I'd never even heard of the company at the time. So, if that record date is set, we would probably be owned by people who are current shareholders, like we disclosed we are. We would probably be at zero. there's a little bit of wiggle room in that depending on how it's traded, but it would probably be just sent to the people who wrote it. So we would be back in the camp of owning something that's worth 5-ish. And interestingly, it's a little tweak on the operations, the order of operations.

The hearing happened, the market largely responded, but then the following Monday after the press release and then his order came out, it kind of tanked another 20% in the process. So, it was just a chaotic few days as people said, "Oh, we might get nothing." I mean, the idea that you think you're about to get paid over $25 a share and that goes to zero was traumatic to the market before it started. Then, I think re-going through the process of applying probabilities to it and thinking about the different outcomes.

Andrew: Yes. So we can talk about the probabilities in a second, but let's just stop here. I mean obviously, both you and I disagree with the judge's ruling so, why do we... We'll talk about the process, we'll talk about probabilities and all that, but let's just start with the basics. Why do we think current shareholders who own the stock right now are the people who sued and got the settlement and everything? Why do we think they should be the people who get the payout versus the people who owned these shares back in 2018?

Chris: The view that I have is a view that if you pulled away from this case and just overheard me speaking about this. A lawyer who works in corporate law would say, "Of course, why are you saying that?" It's practically just defining terms. It's not even going out on a limb. It's just to say this is a derivative case. The shareholders involved in the derivative case are bringing it on behalf of the company. If the company sued somebody, say Renren decided themselves, we're going to sue. You'd normally be brought a decision made at the board level. That would normally be how it's done. However, when a corporate entity that's owned by public shareholders has a problem, especially a problem that involves the board members themselves, the courts don't expect the guilty defendants to see themselves. And shareholders can say, "We're defending our rights on behalf of the company."

So this is not for damages and this is not a shareholder class action, which people think of, it's just another thing. And so, to say that the benefits of this will go to current as opposed to former is as if I put out an announcement on some other company we're invested in and say, "Hey, you know, we've been talking about this big dividend. Oh, by the way, the dividend is going to go to company shareholders, not former shareholders," or some other set of people which besides the logistical difficulties of even sorting out who they are and where they are, which is not obvious to the transfer agents and so forth. It would be an interesting detective process. It's just not something that's done in a derivative suit.

Andrew: Yeah. No look, I 100% agree. I mean, people can go, I've pulled the Wikipedia page up here, you can go see it like, through the roof shoot. That's exactly what it is, right? It's the current shareholder suing the company and saying, "We owned the company. Directors inside did something wrong. We're trying to get persons from it." And more than that, I know this isn't legal, but I've been thinking like, hey, you and I can go sell a stock today, right? And tomorrow, a buyout announcement gets made and the stock goes from 10 to 20 and under this current... Under this thinking, we could go sue and say, "Oh no. That 20 belongs to us," because the negotiations were happening while we were shareholders, right? The negotiation is wrapped and we sold, but all the negotiations happened when we were shareholders, we should get that 20.

I realize that that's not the legal argument here, but that's kind of how I've been looking at it, or you go buy a bankrupt claim, you buy a bankruptcy claim for pennies on the dollar and it turns out to pay out a par. Well, are we going to expose ourselves to former creditors? Coming in and saying, "Oh, well, I owned that claim when it was in bankruptcy. I sold it to you, but I deserve to get paid out of parlec[?]." It just seems like it opens up a can of worms to who is entitled to what when things happen, all that type of stuff.

Chris: I just want to build on that for a second and this is another non-lawyer point. This is simply a matter of logic and the law doesn't have to be logical, but just given that we also happen to have the law on our side, I just wanted to build that, which is we are bringing a view to this conversation that is wholly conventional. Ubiquitous almost. The antithetical view that we would up and everything. I mean, I might, as a capitalist that is probably net, we're more harmed by litigiousness than I benefited.

The idea that the entire American corporate law system would be upended. I mean, kind of like that, but that's a radical view. That's something you don't do through legislation. That's not something you would do at the court level, not even an appellate court, not even the Supreme Court to say. I mean, you couldn't organize shareholder cases trying to hunt down the former owners. And if the current shareholders' rights were basically clapped suit, utterly change. In the 99% of the time that we're not suing anybody, it's still the case that we have rights. That we will defend on behalf of ourselves and our investors.

And when we're talking with managers or directors, they know that it's in our toolkit. That's in our toolkit in the friendliest situation, but if they knew that under no circumstances were their current owners are able to defend their rights because the benefit would go someplace else. You wouldn't be able to organize in any real way. It would collapse the entire system. I mean, it would be a revolution, maybe a good one, maybe a bad one, but one that would be pretty amazing to have. Just kicked off by one judge, in one case, and one state.

Andrew: Yeah. And again, just going back to common sense, it seems weird that you can look at the stock price. And you know, I'm looking in December 2020, the stock is trading for $4 or the-- Right after the all these deals happen, these stocks from... Well, actually, that was a dividend. But, you know, the stock trading for $4 is-- Clearly, people are assigning no probability. The current shareholders buy the stock, do the work, hire the lawyers, go pursue all these. It seemed very strange that all these shareholders should do all this work, and then the judge should just be able to say, "Oh, no. The people who actually took the risk pursued this claim, got what is like a really good outcome. They shouldn't get any of the benefits. It should go to all the people who-- they knew that the claim was out there." Who knows better than the shareholders at the time they got robbed, who got robbed? Who decided, "No, we're not going to pursue this claim. We're to sell." It just seems like a strange, strange set of facts and patterns.

Chris: Well, I think one of the things about the fact pattern was the settlement itself drew other participants. So, one of the things that happened when the settlement was announced after October, is that a law firm that is pretty well known amongst [inaudible] Gerard[?], and it is a firm that, I believe, has filed a objection to every merger I've ever looked at since 2002 or so. I mean, it was somebody like them, but they're frequently the name on that.

And the deal is we object, we're happy to settle for our fees plus a little disclosure for our clients. So the clients get disclosure, we get money. I'm still waiting someday, a law firm is going to say, "I'd like to settle and I'd like my clients to get a big pile of cash. and I don't want any money. I'd like some disclosure for our firm. If you could give us a list of verbiage about the idea." That hasn't happened. So, these guys are certainly aware of the merits of money, but they tend to settle for verbiage for their clients and money for themselves.

These guys, whenever there's a, I think they probably literally have some kind of press release AI or something to troll for just a dollar figure like, "Oh, Billion Dollar Deals announced we're suing for $10 million," or something. They literally did that here. The three $300 million, they might not have noticed until this big figure came out. And I think part of the game was we'll object, we'll settle, we get paid off. But there was then this objection on behalf of an attributively, trivially small shareholder from the earlier class that the judge could point to and say, "This is not a unanimous settlement," and that was one of the things he was able to point to in his order.

Andrew: So let's talk, you know, we've talked about how we think of fairness and all this other stuff, but laws generally decide it on precedent. The judge here said, "Hey, I'm... Current shareholders don't get the money. It's going to be the shareholders from 3 or 4 years ago who'll get the money." Let's talk precedent. Is there any precedent for a judge determining that current shareholders don't get paid? Or is there any precedent for a judge deciding that current shareholders do get paid?

Chris: Yeah. It is a very thinly cited order. The fact-- [crosstalk] The judge's order of denying settlement. And then, the fact that he's taken several more bites at the apple. He's come out every few days, it's basically, what was it... And another thing, he restates it, but no further citation precedent or legal example that's cited. The whole topic of citation is complex here, in that this is under Cayman law. So, when we're talking about all of the different attributes here, it's a New York court because that's where the malfeasance, you know, everything kind of goes through New York and shows the mechanics of the financial world

So that you typically do find a reason to have something in New York, but under Cayman law, which is a tighter subset than a lot of American corporate law, there's no standing for these objectors. The only type of case that can be brought, the only legal standing that you can get to is Renren. The shareholders have the side door of suing on behalf of Renren, but there isn't a statute. It's very confusing to cite precedent for the settlement in opposition to the order. Denying the settlement in that you're trying to prove a negative. There is no category for this objection to exist. There is only the company, there is the suit on behalf of the company, and the settlement thereof. So, he's talking about something that's very thinly cited, that doesn't really fit into Cayman, or I can't find it and he's not been able to point to it.

And I think, going back to my status as a game theory observer if there was this other category, we certainly would have seen it by now. Note that the, I don't want to call them ambulance chasers, but somebody else might call them ambulance chasers, that found the objection. They're exactly the kind of firm that would have filed a damages case, a class-action suit, which takes years and nothing. I mean, there's got this type of suit, there's nothing else and there's a lot of money at stake. There's something that appears to have been bad behavior and nobody filed alternative types of suits.

So, this is the only game in town in terms of a precedented category under Cayman law. And I think that really restricts the different legal outcomes here. Then also restricts, by the way, legal outcomes that might be perfectly adequate to you and me. One of the things that you think about, in terms of just a brainstorm of what might happen from here, is what are all of the intermediate options between triumph and disaster. So, call high 20s, low 30s triumph. Call 5s disaster. This payment that we might get or might not is the battle here. If you say, "Hey, why don't we just split the difference with the-- There are these subtractors [?], they are the other guys. Why don't we take half and half?" That would be impossible. And that would be impossible because any money that goes to anybody other than this current set of shareholders is then depriving of these current. And now, the victim would just be reversed.

I mean, if the lawyer said, "We really want to get our fee. Okay, it won't be a third, but maybe it'll be 10%. Let's just make everybody a little happy and spread the money around more generally." That would not be legal in any way. That would be done on behalf of Renren. And so, thinking about it from the company's perspective, that would be precisely like a company saying, other people are unhappy with how much our shareholders are getting, let me pay some dividends to people other than common shareholders. That would violate the, again, if you were looking at this order, somebody familiar with this situation would think it's just defining terms. Dividends go to to the holders. Yeah, well shareholders are treated in common and they don't go to X holders, as much as they might like money.

And so, the company has, in SEC and in their filings, disclosed this litigation, referred to this litigation. This litigation is in essence an asset of the company that might pay off or might not, but they have no right, let alone incentive, to do anything other than consistent with their disclosure, what this suit was. So the fact that the share price reflected, that the owners were expecting, that the company was expecting to pay this money out to one set of people. And this was in a disclosure. It would not be legal for them to do anything other than that.

Andrew: Yup. No, I 100% agree. Let me talk about something. I want to talk about the go-for path, but there's one other unique thing that-- Again, I'm not a lawyer so I haven't fully wrapped my head around all the dynamics here. But this settlement, right? Renren has, it's from the majority shareholders. They're paying $300 million roughly and I'll just use made-up numbers to make the numbers very easy, right? But let's say, Renren had 30 million shares outstanding. So, if every share was getting part of the settlement, every share would get $10 per share, but because the majority shareholders are paying the $300 million, and they said, "We're going to recuse ourselves. All this money goes straight into the minority shareholders." It would be $10 per share, but only minority shareholders get it, so it's $30 per share. And then fees and stuff maybe bring it down a little bit, but that's the rough math, right?

One issue that's been raised and one issue of thinking about is, hey, it's very strange for the settlement to go... It's kind of skipping the company, right? It's just going straight, not to all shareholders, straight to the minority shareholders. I think the judge raised some issues and the objectors raised some issues. That's still one of the things I'm kind of thinking through. How do you think about that dynamic?

Chris: I think that's something that can be sorted out on appeal. I think that the logic of it is, almost in a sense, the purest way of handling this. Especially that the intermediary company still has some of the people involved that caused this situation, right? It's not as if there's a totally new set here. So, I think that it is kind of the purest and most logical and elegant solution as is. Although I also would say, it has established an acceptable settlement for everybody directly involved. And I can also just share that I'm confident that it is, as of today, still completely acceptable to everybody. To show how strong a settlement it is, even after the judge pushed back because it's possible that the judge could have actually, simply by his opposition, damage the settlement, right?

It could be the defendant's go and say, "Hey, this guy might side with us. Screw the settlement. Let's just go to trial with this guy." They have not said that. They consistently want this settlement, given that the settlement reflects the economics that is mutually acceptable. You could, on both grounds, recut it nominally in a way that would restore this precise balance and say, let's do a $900 million settlement that goes to everybody and back and forth. It would be-- And we could even have if the company stipulates ahead of time, we will dividend what's out there. It seems like it's a distinction without a difference to me. If somebody really said, "I feel extremely strongly that these defendants are paid the money that they're paying." Sure. I don't need 300 or 900 settlements. Subtly, it's just arithmetic.

And then, if you said, "We need this money not to go from escrow to the shareholders. It needs to go to the company to come in sin zeros." Okay. I mean, we can solve for both of those things if, on appeal, they care about it, great. It seems a little odd as a focus. Although I would admit in terms of where we stand today, that is something legitimately unusual about this situation, that then, in terms of precedent value, makes it thinner.

Andrew: You're hitting it in all the angles I was thinking because one solution to... A, you raise an important point. The defendants have not said, "Hey, I want to break this thing," right? They want this thing to go through and a lot of that relates to what you said earlier. The attachment, they don't want discovery happening. They want this settlement to go through which I think is very important. But the other thing was one way to solve a lot of the issues with this case would just be, "Hey, we're going to balloon out the settlement. It goes from 300 million to 900 million, a billion," whatever. And then, the defendants who... It'll go to all current shareholders and then the defendants just give all the money back, but there are quirks and complications there. Again, not a lawyer. I can't say for sure.

Chris: If you and I, if we were going on vacation or something and in the first day, I paid for something for both of us, and then the second day, you paid for something for both of us, and we were both 100% happy to say, "Hey Andrew, let's just net it out and I'll send you a check," and some third-party came in with their hair on fire and said, "Oh my goodness, you can't do that. You can't net it out. You have to have the money go all back and forth, the full gross amount. My first thought would be, I'm not in love with the third party that cares about something that they're not involved in when all the people who do care about it are happy with it.

And then, the second thing forcing the money to gross back and forth, of course, the conclusion we then go to is the net economics. And if we then somehow need to replicate the net economics with gross money, sloshing back and forth, fine. I'm glad I have more important things to worry about than the people who are upset about our just netting out the economics on a settle.

Andrew: Yup. And one thing, I just want to bring this out, kind of out-probe[?] nothing, but one person pointed out there was a case a couple of years ago. Windstream was a telecom company and they dividend it out to their shareholders, shares of unity, this company. A couple of months later, a hedge fund bought up a bunch of debt of Windstream. And then, they argue for fraudulent conveyance basically. They said, "Hey, you dividend out all these years of unity. You were not allowed to do that. We're taking you to court. You need to pay off our round-off fund and at par." No one thought they had a case, but they did win and they got paid off at par, and they threw wind with Truman bankruptcy. And it was crazy. It was crazy, right?

But the one thing about that case, when the hedge fund bought Windstream's bonds, they did not own Windstream's before the payment, right? They owned it after and they went in and argued, "Hey, it was fraudulent conveyances historically," and all the people who own the debt at the time that the judge said, "Yes, this was a fraudulent conveyance." They got paid off. It was not the former shareholders and that example has just always sat in my mind. That is how capital markets are supposed to work. If you want to argue something harmed you, you need to keep owning it, and you need to sue to get to your money. Or you know, there are class actions and stuff, but that was just one thing I've been thinking about a little. I wanted to make that point.

Chris: I think it's an important point and I think it brings up... One thing I do want to share is that, which is both a point about the logic and ethics of our current system, and it's stipulating that the current system is utterly consistent with our treatment of the derivative action going to us current shareholders. [crosstalk] And why we might not want to foment a revolution at the appropriate level, which would probably be at least appellate, if not legislative, not a judge who has a personal feeling about fairness is this. I would not be able to defend our rights in any way if I was not able to concentrate on our position. We own millions of dollars of this. If I, as an individual, owned hundreds or thousands of dollars of this, I couldn't pay for the lawyers and the resources necessary to defend ourselves, right? If you had one chair, if everything had to stay as it originally was before there was an issue worth defending, the defense would be impossible.

So, it's important for defending your rights that you have the ability to concentrate the economics. And for the people who don't have concentrated economics, the markets have a discounting mechanism. They got more from us buying their shares than they ever would have had we not seen the light at the end of the tunnel and had we not had to, as we paid for shares, start to price that. I think that after the judge's decision, there were a few days where the price was wacky, I think 10 or 12. I mean, we were talking about this and the market, by probability, was well less than 50/50. I think it's much more than 50/50 that this is overturned on appeal, but when it wasn't really working as a discounting mechanism, we were part of the solution. If there was somebody who didn't want to spend their days on event-driven, special situation investing, I think it probably makes sense to either put an enormous amount of effort into it or none. I don't think you'd want to toy with it. That we are the solution for the market's discounting mechanism, concentrating a position, defending our rights on behalf of ourselves and our investors, and overpaying to the people we bought our shares from, relative to what we would do, had we not had the ability to concentrate.

Andrew: Perfect. So, let's talk, I want to talk timeline and maybe odds in a second, but everything we've talked about so far, before we get into the timeline, odds and all that. Anything you think that we didn't hit? That we should have hit, anything we should hit harder, that we did hit?

Chris: Nothing we need to hit harder for people who paid attention to the earlier podcast or on the earlier stuff. I mean, there's a longer version of the history here, but no, I feel good about the recent stuff.

Andrew: Let's talk about time on. We are recording this on January 6th. We recorded this on January 6. What does the go-forward timeline look like? When will, you know, obviously if the judge's order stood right now, historical shareholders would get paid this settlement. Historical shareholders would get paid. Current shareholders would be very unhappy. [crosstalk] around 15, 18, or something. They would be very unhappy. What does the timeline look like? When are we going to know more about how the appeals process plays out? Who's going to get paid and all that?

Chris: 100% probability that at least one current shareholder would be very unhappy. If the current ruling is upheld, on January 31st there will be a hearing in front of the current judge. I place exceedingly low odds on anything substantive happening. I think it's going to be basically a status hearing.

Andrew: It's just a status hearing. Okay, perfect.

Chris: And so, in theory, we could come back, in theory, come back with a new settlement or an adjustment. I believe the current lawyers working on this have no flexibility, and the judge might have this view about who the group should be, but neither, I believe nor, and I won't put words in their mouth, I have no reason to believe that anybody else thinks there's any flexibility to split the difference. Earlier on, could some money have gone elsewhere, I think that that is impossible at this point.

Andrew: Yeah. So let me ask just a real quick question. We mentioned, and one of the nuances that we hadn't talked about, but that I had been interested in before disaster struck was the lawyers are getting paid $100 dollars here, and the judge said those fees are way too high. I think a lot of people have looked at precedent cases and said the lawyers did great work here, right? This was a record-setting settlement. It set a lot of new precedences. We talked about the minority payout and everything, but the judge said those lawyer fees are too high. Those need to go down. So, they go down to 50 million, they go down 70 million, whatever. That's 30 or 50 million extra dollars. It goes out at 30 million, 7 million extra dollars. [inaudible] That's 50 million of extra dollars that can go somewhere.

Now, before the judge's order, my hope and expectation was if it went from 100 to 50, that extra 50 would go to minority shareholders in some form. But let's say it goes to 50 million, there's 50 million extra. Could that 50 million go to prior shareholders in some form to settle? Or do you think like, as you said, the company declares a dividend, I get it? It can't go to prior shareholders, or prior shareholders can't say, "Oh, was that a dollar dividend? I'd like five cents just because I used to [inaudible]." Do you think current shareholders will say no, you can't have any of that 50 million? It belongs to us.

Chris: So as I was listening to the hearing, and it's a little bit like if you drop a glass and it shatters, and your first thought is how can I un-drop the glass? You have this initial reaction to how can that thing I'm watching not be the case? And my first thought was to cut the fees, pay off the objectors, and that was just kind of my logical immediate, how can we instantly make this thing not the case? I think that that is an exceedingly difficult solution because it undermines the whole thesis of the implacability and the unity of this current group being the holders. I don't think they have the right to do it.

Andrew: I agree. You know, in bankruptcy, one of the old things is some company with a crazy, complex capital structure goes bankrupt, and let's say the senior debt is getting paid 50 cents on the dollar. A lot of times, they have unsecured debt and the prep holders might get a penny on the dollar or two pennies on the dollar or something. It's called just the tip, just to waive their newest value so that they accept and they don't drag things out for 6 months. I was kind of thinking, oh, you give the former shareholders a couple million, just the tip, to get this over with. But I agree with you. I just think you're playing for too big of odds, and I just don't think there's a claim there.

Chris: Before we got here, had that objector law firm come to us confidentially before filing it? I think I might have a different answer in practice without creating the storm we're in now. At this point, I think we have only the option to fight. Confidentially, earlier, there might have been a little more flexibility to have avoided this situation that could have come out, of course. But at this point, I believe we are going to go to a hearing on the 31st with clarity from the judge, clarity from the current lawyers representing the derivative suit, and this zany situation which is the lawyers representing the objectors. It's not the dog that caught the mail truck. It's like the dog ate the mail truck. They have the whole thing and they, I think, have a very, very high probability of losing the whole thing.

But they actually are gonna have to do all this work and probably not get paid anything. I mean, they would have probably love to be able to split the difference in some way now. So, that gets us through January.

Andrew: So, okay, after January, we've got the status here on January 31st. Who knows with this case because nobody thought the old hearing to prove the settlement was going to be. So who knows? It could be fireworks, but after January 31st, what's the appeals process look like?

Chris: It's going to be March or April and the names are a little confusing in New York because it goes to the... The first directorate is the middle, and then it goes to the Court of Appeals, which is the name of the Supreme Court, of the highest court. But the middle-level court is March or April, and then it will be several months thereafter for a decision. There's a little bit of flex in terms of how this is handled. New York has a couple things that are very advantageous to appeal. One is we can automatically appeal, so there's no risk of the appeal is rejected. It will go to court and we will get hurt. Currently, we're appealing on pretty specific grounds related to the record date and the group that's appealing.

Here's a couple of things that are at stake that's really important. First of all, with a few weeks' warning, we'll find out which judges are hearing this. It would be, in my mind favorable, if the same judges that had rejected the previous efforts to throw out the case are back in because then, we could very much phrase this as based citing you, based on what you wrote earlier. We are the correct plaintiffs and then, I think that would be very good news.

Andrew: Chris, can we just hammer that point? I'll summarize it and you tell me if I'm wrong. Earlier in the podcast when you were going through the long history, you said the defendants had appealed. They had tried to get this case thrown out and the appeals court said, "No. Current shareholders have the standing to sue you." And what you're saying is, our hope is it goes to the exact same judge. [crosstalk] And these guys say, "Hey, old shareholders want the money and we're appealing," and we say, look, you guys said years ago, you said current shareholders have standing too. That's exactly what you're saying, right?

Chris: Yeah, and it would be slightly less good if we were dealing with other people. We'll still make the same case, but it would sure be nice to deal with the actual same judges.

Andrew: It'd be nice, but at the same time it would be like going, I tell someone something and then 2 months later, they come to you and say, "Hey, Chris! Andrew Walker signed this lease for Rangeley." And I'm appealing, you say, "Well, he signed it for Rangeley. You know, he's a signatory. He's part of my crew."

Chris: Yeah, that's the situation. Now, there are, from top to bottom, in terms of the middle level of the court, the outcomes when things are unanimous or not unanimous, there is a difference between then whether you can appeal it again to the top level automatically or have to request, and have to have the second appeal accepted, right? So, you have a third bite at the apple. Either automatic or one that you can make a case for, depending on whether it goes well or badly for us in the middle of them.

Andrew: Correct me if I'm wrong, the middle level, it's 3 judges make the ruling, right? So what you're saying is if all 3 decide, one way or the other, the appeals process would get a lot more difficult because you guys say, [crosstalk] "Hey, I want..."

Chris: We could ask them. We can ask them. If the 3 guys say no, then I could say, "Oh, can I please ask again?" But they could say no to that. If it's two to one, then I can automatically get a good bite. Okay. So, we're going to find out do we have the same people that we had before? It would be nice. I think it would be fantastic if we did. I think it'll be okay if not. That's the first thing. Secondly, it's a little bit of flex in terms of how long it takes them to come back. I will have the mildest bit of happiness to see a very quick decision. I think siding with us, even though normally, overturning a judge would be the more novel thing. I think in this case, if we just hear citizens coming out in 15 minutes in say May, I feel very good about that. I think that siding with us isn't an easy decision. And then, I get a little more nervous if it's 5, 6 months later. Where maybe they were in cahoots, maybe they just have the same "Let's start a revolution in how derivative cases work." As months go by, I'm a little more queasy relative to where I am today.

Andrew: Could I put words in your mouth and say, I think a quick decision is likely to be better for current shareholders? Because current shareholders have cited a lot of precedent to why current shareholders should get... A longer decision is probably more likely to be disadvantageous for current shareholders because the appeals court would have-- because the judge didn't really say precedent for why the record date should be 2018 former shareholders. The appeals court, it would take longer because they'd actually have to go find and cite that precedent, most likely. Not that they couldn't make a ruling without citing precedent, but they probably would want to do the research, cite some type of precedent, or if not, at least do research to back up what they're doing. So, a longer process, not to say it couldn't be one way or the other. Judges are busy, there's lots of stuff going on, but I think that's about right. Would you agree with what I'm saying?

Chris: It's precisely right. And just stated broadly as a matter of persuasion, I always think that if you're trying to get somebody to do something, make the 'Yes' very convenient and simple, and make the 'No' convoluted, complicated one. I think we've done precisely that here. If they just say 'Okay' to us, you could just, in a day or two, flip around a very normal-sighted decision. You would, I think, have to quite rewrite an explanation for why this judge is doing this thing. It's possible, but that could be a 6-month process, not a month or two. Then there's the third issue. There's the length of time, the who gets it.

And the third issue that I'd like to bring up between now and March or April, is we currently have a specific appeal on a specific issue regarding the record date and the class that I think is a pretty crisp clean specific one. It is under consideration to take a different route than that, and I'm satisfied with the current plan and open to going with the current plan. Something else we might do instead is simply open up the whole thing and say, "We are appealing this entire thing." The legal fees, every single syllable, just because the hearing in order had gotten so toxic. We really don't want any shot of it going back down to this court where somebody could nuke it. There are probably some ways that...

Okay, I'm not sure I want to explain all these in case he hasn't thought of it then hears this. He could nuke a few different things that he hasn't done already. For example, he could go back and say, I changed my mind on the escrow in excess of the 300. A lot of our negotiating leverage here is the 500 in escrow attachment. He could say, "I'm the judge. I'm not attaching that now. I hate these guys, screw them." He has not done that yet. That's one of the things he hasn't done. To prevent a tit-for-tat instead of this very specific appeal, we could just appeal the whole thing. And so, that's not the decision that's been made yet, that's not a filing that has been made yet, but just brainstorming what happens between January and March that's kind of on the table as well. Okay?

Andrew: Okay. I think we've laid out a timeline, I think we've covered everything. Anything else that you want to cover here? I mean, I think we've done-- Oh, you know what? I guess the most important thing obviously, we've talked about we have a position. Right now, the stocks are at 18, the original settlement was about $26 per share plus 3, $5 dollars of stub value, whatever you want to call it. So, you can make the math easier and say we win on old terms. The stock that were at 30. We lose the stocks worth 5 at 18. You're probably about 50/50 for if the appeal works out or not, right? What odds would you put on this appeal working? Current shareholders winning, that type of stuff.

Chris: Sure. I would, and then it works out just approximately a couple more bucks if we take it out of the lawyers. So, you know, 26 becomes 28. Within an order, a magnitude of that. I think it is a broad range that-- The three legal standards is something... Preponderance, roughly more than 50/50. Is it clear and convincing? Roughly 2 out of 3. Or is it beyond a reasonable doubt? 95 or so. I think this is absolutely a preponderance. I'm in a table-pounding to be clear that it is more than 50/50, that this order is overturned. One way to think about it is we're eye on the appeal bench, having read already all of the facts that they will get. I have 100% chance that I would reject the order and no ambiguity in my mind that that is correct. And then, the question becomes how much do I then discount what I am certain that I believe the correct decision would be at the appeals level?

And then, you have to discount that somewhat. I come to the conclusion that I discount that at about 10%, if anything, it's a 90% chance, but I think they're in range of what would be reasonable. Is north of clear and convincing? So north of, you know, 2 out of 3, 3 out of 4, 4 out of 5, 5 out of 6, kind of somewhere in that range. I never really get more than 95% sure of anything, so I don't like talking about investments where we're like, "Are we 97 or 99%?" I'm not 99% of anything. Weird stuff happens. This case is a great example of humility and the necessity of humility. I didn't give any odds that this judge would give this order when he did. So, people can miss important things all the time. I missed that and so, in a world where I can miss that, I can miss the next thing too.

Andrew: Look, not to pile on, but let me add one more bear case pushed back that has been top of mind for me. So, do you remember, 2019 early 2020, Sprint and T-Mobile had a deal to merge, and the DOJ approved the deal and a bunch of state attorney generals sued to stop the deal. They said, "Look, this is a 4 to 3 merger in wireless. The wireless industry will be way too concentrated if this happens." And I think, you and I and a lot of people looked at the state's argument and we said, "Oh, the DOJ sued to block AT&T-Time Warner." That was... I knew a lot of people who thought AT&T and Time Warner shouldn't go through. I knew a lot of people who thought T-Mobile and Sprint should go through. I didn't know anyone who thought AT&T-Time Warner should be blocked and Sprint-T-Mobile should go through, right?

I think a lot of people looked and said, all right, the antitrust government, the antitrust division might be a little politically compromised. They might have sued to stop AT&T-Time Warner because Donald Trump didn't like CNN. And they might have approved Sprint-T-Mobile because Donald Trump really liked SoftBank's Masayoshi Son, who had a huge position in Sprint and had done a lot of lats, right? I think we looked at that and we said, oh, I think more likely than not, the judge is going to side with the state attorney's generals and say this deal should not go through based on all sorts of reasoning. The companies were changing their reasons for why this deal should go through all the time because I think they knew they had a kind of we can't.

And it came out and, I think was February 2020, the judge said, "No, I side with the DOJ. This deal can go through." Sprint stock which had been pricing in I think, like a 40% chance of the deal going through. Sprint stock is up 120% in a day, right? In hindsight, I looked at that and say, of course the judge is going to side with the DOJ. Have you ever seen the judge not side with the DOJ when the DOJ wanted to approve the case? I kind of said, oh, maybe my base rate should have been this gets approved. What judge is gonna go with the attorney general's over the state? So, my question to you would be, a judge just made an order. If the appeals court came back and said, "Yeah. We side with the judge on who should get this thing." Won't we be looking at it in back in hindsight and say, "Oh, well, you know, it kind of was the base case." Does that make sense?

Chris: It does. And to add to your base case, the judge doesn't have a particularly high rate of being overturned. Not a great statistic because he doesn't have other corporate cases like this. There aren't corporate cases in New York that much, so they're not good precedents. Many of the things that were peeled were just kind of procedural. And so, it's hard to look at statistically. [crosstalk] Under...

Andrew: I was just going to add, a lot of judges are politically elected. And you have some judges who are elected and have a political agenda, and they'll get overturned all the time because they're just running with their political agenda. A higher court will say, "No, we've got a law to protect here." So what you're saying is this judge isn't like crazy, just like a [crosstalk] spew in a job.

Chris: No. Yeah, right. This then supports your view. Now, to undercut it in a couple related ways, he is elected and the appellate judges are appointed. So from here on up, we're dealing with people who I am more sure are going to go based on the facts and the law versus their feelings, their personal feelings of fairness, number one. And number two, I struggle to find a very coherent, political narrative here. If I am in some big asbestos or tobacco or Pharma case or dealing with opioids, I could say, okay, stipulate that there's going to be a progressive narrative that might conflict with certain investors' interests.

There really isn't an obviously progressive case one way or another, but if I'm trying to read into where the energy comes here, it is one where there is this discomfort with anybody who is opportunistic or sought out the situation we're in. Where there are other people who had stumbled into the risks and rewards organically and there is a lack of sympathy for the former and sympathy for the latter, which I believe is a kind of personal feeling. It's not something that is addressed in the law or in the facts here. So, if I do think that sure, maybe they're friends. It's this guy's job to make an order and he made it.

Let me undercut one thing further, which is it's very clear, in statute, what a judge's job is in a settlement and it is to accept or reject the amount. There is not, in New York statute precedent, for the judge to get involved in altering the substance of a settlement the way he did. So by analogy, if you're getting married, I can run into the church and say I object, but I don't then have the right to say, and here's this other unrelated person who I now require you to marry. Because back to the logic at this point, is he's basically-- There are two sides, both of whom want to settle and he's saying, "You uniquely have to not do that settlement." It's that, you are this like a second-class citizen. Anybody else in the world is allowed to voluntarily settle with this other party, but you can't do that. You have to do this other thing. That's unusual.

Andrew: I have been wondering if this opens the door, and again I'm not a lawyer, but I had been wondering if this type of ruling, if judges, if the appeals court worries like-- This opens the door to judges just coming in and saying, "Oh, well, we know you had a bankruptcy settlement or whatever, but you know what, I really like the unsecured creditors more than the secured creditors. And so, I think the unsecured creditors, instead of getting 50 cents on the dollar, should get 60 cents, and the secured creditors instead of 100 should get 90." And that's just how I feel because I feel like the unsecured creditors, I like them more. I know that it's a little flippant, but I have been wondering if that opens the door for that type of discussion. And that's one of the reasons why the appeals court has to shut this down because you've got a settlement with all parties involved in it and he just completely overturned it. Chris, this is running good.

Chris: I want to take very seriously, the concern about, is it just formulaic that you would approve the judge's order? Something in terms of the just politics and the game-theoretic dynamics here from the appellate level that, I think it's stronger as you open up, is that even stronger than politics, than party or ideological politics, is the institutional prerogative to protect and strengthen your own entity, which in this case is the New York courts in New York law. I think that a decision to uphold this judge's order will be the last corporate law decision that you would ever see. You know, you'll be back to doing DUI cases and so forth. I think that goes-- Delaware's the majority. It'll basically say, "We can't use New York anymore." So I think that if there was anything other than law and precedent, which I believe is completely on our side, that would affect how you think about this case. It would be for New York to have a real role in corporate law. This order would have to be undone.

Andrew: Perfect. Well, Chris, I want to wrap it up there. We've been running long, but I will give you any last thoughts. I asked this earlier, but any last thoughts on timing, probability, anything that we haven't hit that you wish we had, or anything we skimmed over that we should hit harder?

Chris: No, I think that the brainer that we've dealt with as investors is a sizing one. It kind of hands you, there's an upside, there's a downside, there's a probability you're going to get what you get. And so, one sizes accordingly, I don't think this is a situation where you have to have any particular reason why you have to deal with options or anything more exotic than just place your bets, and then we'll see what happens.

Andrew: Perfect. Well, look, 75 minutes. I think we did a fantastic job. We hit so many different aspects of it. I'm surprised we got through so much. I'd encourage anyone, if you want more background on this, please, the prior podcast is in the show notes. I'd encourage anyone if you want to see... Chris wrote Best Idea of 2022, RENN. I'm going to include a link in the show notes. He's got a lot of the precedent cases side in there. He did great work there, so I'd encourage anyone to go check that out. And the last thing I would encourage is Chris and I, as we said, we're not lawyers, we're open to hearing other arguments, other precedents. You're listening to this podcast. It's not going to be hard to figure out how to contact either Chris or I. So, if you've got a diversion opinion or if you've got anything that's as juicy as Renren that you're looking at, reach out to us. We'd love to hear from you. So with that, Chris, unless you've got anything, I'll wrap it up.

Chris: I have nothing to add, as Andrew says.

Andrew: Hey, this has been great. I'd say I look forward to having you on in 6 months, talking more Renren, but hopefully, in 6 months, it's appeals court rules in our favor and we have nothing to talk about. So, we'll just have to talk about the next one.

Chris: We'll be on the beach or something. We'll have some exotic background of some fancy resort or something. We'll be talking about it.

Andrew: Chris, it has been great having you on and we will obviously chat soon. Bye, thanks again.

Chris: Thank you.

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