Ewolski v. Brunswick ( 2002 )


Menu:
  • 5(&200(1'(' )25 )8//7(;7 38%/,&$7,21 3XUVXDQW WR 6L[WK &LUFXLW 5XOH  (/(&7521,& &,7$7,21  )(' $SS 3 WK &LU )LOH 1DPH DS 81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB (0,/ (:2/6., ; 3ODLQWLII$SSHOODQW    1R Y  !  &,7 ULIOH@ORDGHGDQGUHDG\WRJRlsRLQW$SSHQGL[ ms$l GHIHQGDQW RIILFHUV LQ WKH VHQVH WKDW WKH RIILFHUV KDG DW  6RODU 'HS DW    6RODU DVNHG /HNDQ LI KH ZRXOG DIILUPDWLYHO\DFWHGWRGHSULYHDOORIWKHPRIWKHLUOLEHUW\  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  , DOVR EHOLHYH WKDW WKH SODLQWLIIVj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jVYHKLFOHDQGKHUER\IULHQGOHIW ,QWKHPHDQWLPHUHODWLYHVRIWKH/HNDQIDPLO\ZHQWWRWKH WKHVFHQH,Q6WHPOHUWKLVFRXUWFRQFOXGHGWKDW%ODFNZDVLQ %UXQVZLFNSROLFHVWDWLRQWRRIIHUDVVLVWDQFH%HYHUO\/HNDQj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sDPHV3RO]QHUDPHQWDOKHDOWKSURIHVVLRQDO DW WKH VFHQH  3RO]QHU KDG EHHQ PRQLWRULQJ FRQYHUVDWLRQV  $UPHGWDFWLFDOVROXWLRQVDUHUDGLFDOVWUDWHJLHVXVHG EHWZHHQ6HUJHDQW6RODUDQG0U/HNDQ3RO]QHUWROG&KLHI RQO\DVDODVWUHVRUWLQKRVWDJHVLWXDWLRQV8VHRILWKHUH %H\HUWKDWWKHWKUHDWOHYHOZDVKLJK&KLHI%H\HUWKHQDVNHG ZDVSUHPDWXUH3ROLFH&KLHI%H\HUFRPPHQFHGWKHSODQ LIWKHRIILFHUVDWWKHVFHQHKDGDUHDVRQQRWWRSXUVXHDWDFWLFDO RQO\ILYHKRXUVDIWHUWKHVWDQGRIIEHJDQ7KHUHZDVVWLOO VROXWLRQWRWKHVWDQGRII%H\HUDVNHGIRULQSXWIURPDQRWKHU KRSHIRUDSHDFHIXOUHVROXWLRQDWWKLVWLPH0U/HNDQ SV\FKRORJLVW RQ WKH VFHQH ZKR UHVSRQGHG E\ DVNLQJ KDGFRPSOHWHO\UHWUHDWHGIURPFRQIURQWDWLRQ7KHUHZDV UKHWRULFDOO\ZK\%H\HUZDVFRQVLGHULQJDWDFWLFDODVVDXOW QR HYLGHQFH WKDW KH KDUPHG KLV IDPLO\ RU LQWHQGHG WR KDUPWKHPDQGKHZDVQRWVKRRWLQJDWSROLFHRIILFHUV 8OWLPDWHO\&KLHI%H\HUGHFLGHGWRRUGHUDQDUPHGHQWU\ 7KHUHZDVLQVXIILFLHQWPDQSRZHUWRFDUU\RXWWKHSODQ LQWRWKH/HNDQKRXVH3XUVXDQWWRWKHDVVDXOWSODQWKH(57 VXFFHVVIXOO\DWWKLVWLPHDQGWKHGHIHQGDQWVGLGQRW\HW WHDPWKUHZLQFHQGLDU\GHYLFHVLQWRWKHKRXVHZKLOHXVLQJD KDYH WKH HTXLSPHQW WR GHWHUPLQH WKH ORFDWLRQ RI WKH EDWWHULQJUDPWREUHDNRSHQWKHIURQWGRRU7HDUJDVZDVDOVR UHVLGHQWV,QDGGLWLRQWKHSODQKDGDKLJKSUREDELOLW\RI XVHG GXULQJ WKH DVVDXOW  7KH SODQ IDLOHG ZKHQ RQH RI WKH IDLOXUH,W FDOOHGIRURIILFHUVWRUXQWKURXJKWKHKRXVH LQFHQGLDU\GHYLFHVLJQLWHGDILUHLQWKHHQWUDQFHKDOODQGWKH ZLWKORDGHGZHDSRQVORRNLQJIRU0U/HNDQDIWHUFUHDWLQJ OHDGRIILFHUVWRSSHGWRSXWRXWWKHILUH7KHSROLFHORVWWKH DGLYHUVLRQWKURXJKWKHXVHRILQFHQGLDU\GHYLFHV,WLV LQLWLDWLYHDVDUHVXOW0U/HNDQH[FKDQJHGJXQILUHZLWKWKH XQFOHDUZKDWWKHSROLFHZRXOGKDYHGRQHKDG0U/HNDQ SROLFH DQG WZR PRUH RIILFHUV ZHUH LQMXUHG  7KH SROLFH EHHQ GLVFRYHUHG LQ FORVH SUR[LPLW\ ZLWK KLV IDPLO\ XOWLPDWHO\UHWUHDWHGDQGWKHVWDQGRIIFRQWLQXHG $OVRWKHLQFHQGLDU\GHYLFHVVHWDILUHLQWKHKRXVHZKLFK WKHRIILFHUVWKHQKDGWRVWRSWRSXWRXW $WDSSUR[LPDWHO\ DP6RODUVSRNHDJDLQZLWK0U /HNDQDQGDVNHGWRWDONWR0U/HNDQjVVRQs70U/HNDQ SXWs7RQWKHWHOHSKRQHs7WROG6RODUWKDWKHZDVILQHDQG  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  WKDWKHZDVVFDUHG0U/HNDQWKHQWRRNWKHWHOHSKRQHDQG /HNDQ GLG QRW ZDQW DQ\WKLQJ WKH DXWKRULWLHV FRXOG DVNHGWRVSHDNWRKLVFRXVLQZKRLVDSULHVW6RODUWROG0U SURYLGH+HDOUHDG\KDGZKDWKHZDQWHGKLVIDPLO\ /HNDQWKDWKHFRXOGVSHDNWRKLVFRXVLQLIKHOHIWWKHKRXVH DQG KH ZDV DOUHDG\ LQ KLV RZQ KRPH  HPSKDVLV LQ 0U/HNDQVDLGm>W@KDWjVQRWSDUWRIWKHVFHQDULRlDQGKXQJ RULJLQDO  XSs$DW 6RODU$IIDW 6RODUFRQVXOWHGZLWKDQRWKHU QHJRWLDWRUIURPWKH6RXWKZHVW(QIRUFHPHQW%XUHDXDQGWKH\ &DOOLVjDOVRFRQFOXGHVWKDWWKHUHZHUHDQXPEHURIRSWLRQV FRQFOXGHGWKDWWKHUHTXHVWWRVSHDNWRDSULHVWZDVDGDQJHU RSHQ WR WKH GHIHQGDQWV ZKLFK ZRXOG DOVR QHJDWH H[LJHQW VLJQ LQGLFDWLQJ WKDW 0U /HNDQ PLJKW EH FRQWHPSODWLQJ D FLUFXPVWDQFHV PXUGHUVXLFLGHULWXDO +RZHYHU DIWHU UHYLHZLQJ WKLV PDWWHU , FDQjW KHOS EXW 6KRUWO\WKHUHDIWHUDQDUPRUHGYHKLFOHIURPWKH&OHYHODQG ZRQGHULIWKHUHZDVQRWDEHWWHUZD\RIFRQGXFWLQJWKH 3ROLFH'HSDUWPHQWDUULYHGRQWKHVFHQH&KLHI%H\HURUGHUHG mZHOIDUH FKHFNl DW WKH /HNDQ UHVLGHQFH  3HUKDSV WKH WKH DUPRUHG YHKLFOH WR GULYH RQWR WKH IURQW ODZQ DQG SROLFH FRXOG KDYH DVNHG D UHODWLYH RI %HYHUO\ /HNDQjV LOOXPLQDWH WKH /HNDQ KRXVH  2IILFHUV LQVLGH WKH YHKLFOH WHOHSKRQH KHU DW KRPH DQG RQFH VKH ZDV RQ WKH DWWHPSWHG WR FRPPXQLFDWH ZLWK 0U /HNDQ RYHU D WHOHSKRQHWKHSROLFHFRXOGVSHDNWRKHUWRYHULI\WKDWVKH ORXGVSHDNHUEXWUHFHLYHGQRUHVSRQVH/DWHUWKDWPRUQLQJ DQG KHU VRQ ZHUH ZHOO  7KH LGHQWLW\ DQG WHOHSKRQH WKHDUPRUHGYHKLFOHUDPPHGWKURXJKWKHOLYLQJURRPZDOODQG QXPEHUVRI0UV/HNDQj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jVKHDOWKVWDWXVDQGDOORZHGWKHFRQIURQWDWLRQ RSHUDWLRQ  $ URRPWRURRP VHDUFK RI WKH UHVLGHQFH ZDV EHWZHHQWKHSROLFHDQGsRKQ/HNDQWREHDYRLGHGXQWLO FRQGXFWHG'XULQJWKHVHDUFKWKHRIILFHUVIRXQGWKHERGLHV VRPHWKLQJ FRXOG EH GRQH DERXW sRKQjV SRVVHVVLRQ RI RIsRKQ/HNDQDQGs7/HNDQs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m5HYLHZRI UDWLRQDOMXU\FRXOGGUDZPRUH WKDQRQHLQIHUHQFHIURPWKH ,QFLGHQW,QYROYLQJsRKQ0/HNDQ%UXQVZLFN2KLR0DUFK FRQIOLFWLQJIDFWVWKHUHDUHDOVRJHQXLQHLVVXHVRIPDWHULDOIDFW $SULO   6XPPDU\l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mWDFWLFDORSHUDWLRQVl GLIIHUHQFHRIRSLQLRQl,GDW,QWKHFDVHEHIRUHXVWKH ZKLFKWRRNSODFHGXULQJWKHVWDQGRIIDQGFRQFOXGHG GLVWULFW FRXUW H[SUHVVO\ UHFRJQL]HG DQ H[LVWLQJ PDWHULDO GLVSXWHRIIDFWLQUHJDUGWRH[LJHQWFLUFXPVWDQFHVDVIROORZV ,QVXPPDU\DV,KDYHVHWIRUWKDERYH,GRQjWEHOLHYHWKLV PDWWHUFRXOGKDYHEHHQUHVROYHGWKURXJKWKHWUDGLWLRQDO 'HIHQGDQWVFRQWHQGWKDWH[LJHQWFLUFXPVWDQFHVMXVWLILHG IRUPRIKRVWDJHQHJRWLDWLRQV,EHOLHYHWKDWsRKQ/HNDQ WKH ZDUUDQWOHVV HQWU\ EHFDXVH 0U /HNDQ SUHVHQWHG DQ VHWRXWRQDSDWKRIVHOIGHVWUXFWLRQZKHQKHVKRW2IILFHU LPPHGLDWHWKUHDWWRKLVIDPLO\3ODLQWLIIVGLVDJUHHRQWKH 3X]HOOD RQ WKDW )ULGD\ DIWHUQRRQ  , EHOLHYH WKDW sRKQ EDVLVWKDWSULRUWRYLVLWLQJWKHKRPHGHIHQGDQWVDGPLWWHG /HNDQZDVZLOOLQJWRGLHmSURWHFWLQJlKLVKRPHDQGKLV WKHUHZDVQRSUREDEOHFDXVHWRDUUHVW0U/HNDQDQGQR VRQ DQG EHFDXVH RI KLV PHQWDO GLVRUGHU , WKLQN KH H[LJHQW FLUFXPVWDQFHV H[LVWHG  )XUWKHU WKH RIILFHUV EHOLHYHGKHZDVGRLQJMXVWWKDWSURWHFWLQJKLPVHOIKLV QHYHUVDZDFULPHEHLQJFRPPLWWHGQRUGLGWKH\KHDU KRPHDQGKLVIDPLO\ 0U/HNDQWKUHDWHQDQ\RQH s$DW &DOOLV5HSRUWDW &DOOLVQRWHGWKDWKHKDG %DVHGXSRQWKLVPDWHULDOGLVSXWHRIIDFWWKHUHLVURRPIRUD WKUHHFULWLFLVPVLQUHJDUGWRWKHWDFWLFDORSHUDWLRQV GLIIHUHQFHRIRSLQLRQRQWKHLVVXHRIH[LJHQWFLUFXPVWDQFHV DQGWKLVLVVXHZDVIRUDMXU\  ,EHOLHYHWKHWDFWLFDOHQWU\LQWRWKH/HNDQUHVLGHQFH ZDVFRQGXFWHGWRRVRRQLQWRWKHVWDQGRII 7KLV GLVSXWH RI IDFW LV IXUWKHU EROVWHUHG E\ WKH UHSRUW RI  ,EHOLHYHLWZDVDPLVWDNHWRWU\WRXVHWKHDUPRUHG :LOOLDP&DOOLVZKLFKLVVLJQLILFDQWEHFDXVHKHZDVKLUHGE\ YHKLFOHWRRYHUZKHOPsRKQ/HNDQLQWRVXUUHQGHULQJ WKHGHIHQGDQW&LW\RI%UXQVZLFNWRFRQGXFWDQLQGHSHQGHQW  , EHOLHYH LW ZDV D PLVWDNH WR LQWHUUXSW WKH WDFWLFDO UHYLHZRIWKHLQFLGHQW,QDGGUHVVLQJH[LJHQWFLUFXPVWDQFHV HQWU\WRWU\WRGHDOZLWKWKHILUHLQWKHIURQWGRRU DOWKRXJKWKHPDMRULW\ILQGVWKDWWKLVZDVDKRVWDJHVLWXDWLRQ LQKLVUHSRUWSUHSDUHGIRUWKHGHIHQGDQWV&DOOLVjH[SODLQVZK\ s$DW WKLVLQFLGHQWGLGQRWLQYROYHDKRVWDJHVLWXDWLRQ 7KHUHFRUGDOVRLQFOXGHVWKHWKLUWHHQSDJHUHSRUWRIsDPHV 8SRQUHYLHZLQJWKLVVLWXDWLRQ,DPRIWKHRSLQLRQWKDW s)\IH3K'ZKRZDVUHWDLQHGDVSODLQWLIIVj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sRKQ 7 /HNDQ ZHUH QRW DFWXDOO\ KRVWDJHV EXW ZHUH DGGLWLRQKLVUHSRUWGHWDLOVWKHLQDGHTXDF\RIWKH%UXQVZLFN YLFWLPV RI 0U /HNDQ V DFWLRQV  7KH\ ZHUH LQ WKH 3ROLFH 'HSDUWPHQWjV SROLFLHV DQG WUDLQLQJ UHJDUGLQJ UHVLGHQFHZKHQ0U/HNDQFRPPLWWHGKLVFULPLQDODFW HQFRXQWHUVZLWKHPRWLRQDOO\GLVWXUEHGSHUVRQV DQGKHDIIRUGHGWKHPQRRSSRUWXQLW\WROHDYH 0DQ\KRVWDJHVLWXDWLRQVLQYROYHDQHJRWLDWLRQSURFHVV RUEDUJDLQLQJDSSURDFKoWRPHHWFHUWDLQGHPDQGV,Q WKLVVLWXDWLRQWKHUHZHUHQRVXEVWDQWLYHGHPDQGVDV0U  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  ,,$1$/ VLF@SROLFHGHSDUWPHQWFKRVHWRKDQGOHWKH %UXQVZLFN3ROLFH'HSDUWPHQWPXVWEHHYDOXDWHGXQGHUWKH VLWXDWLRQ  7KH\ VHQW WZR SROLFH RIILFHUV WR WKH KRXVH IUDPHZRUNRITXDOLILHGLPPXQLW\$FFRUGLQJWRWKHGRFWULQH SRVLQJDVFLYLOLDQV RQHLQMHDQVDQGDVZHDWVKLUW RQWKH RI TXDOLILHG LPPXQLW\ mJRYHUQPHQW RIILFLDOV SHUIRUPLQJ RIIFKDQFHWKDW0U/HNDQDNQRZQSDUDQRLGPLJKWOHW GLVFUHWLRQDU\IXQFWLRQVJHQHUDOO\DUHVKLHOGHGIURPOLDELOLW\ WKHVHVWUDQJHUVLQWRWDONWRKLVZLIH$VWDEOHSHUVRQ IRU FLYLO GDPDJHV LQVRIDU DV WKHLU FRQGXFW GRHV QRW YLRODWH ZRXOGQRWKDYHOHWWKHPLQ7RWKLQNWKHLUFKDQFHVRI FOHDUO\HVWDEOLVKHGVWDWXWRU\RUFRQVWLWXWLRQDOULJKWVRIZKLFK HQWU\PLJKWLQFUHDVHDIWHUXQVXFFHVVIXOO\DWWHPSWLQJWR D UHDVRQDEOH SHUVRQ ZRXOG KDYH NQRZQl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mµFOHDUO\HVWDEOLVKHGFRQVWLWXWLRQDOULJKWV PRPHQWWKHRIILFHUVHQWHUHGWKHKRXVH RI ZKLFK D UHDVRQDEOH SHUVRQ ZRXOG KDYH NQRZQjl 'LFNHUVRQY0F&OHOODQ)G WK&LU $OWKRXJKWKHGLVWULFWFRXUWFLWHV2j%ULHQIRUWKHGHILQLWLRQ TXRWLQJ&KULVWRSKHOY.XNXOLQVN\)G WK&LU RIH[LJHQWFLUFXPVWDQFHVDQGFRQFOXGHVWKDWWKLVLVDGHFLVLRQ  VHHDOVR6DXFLHUY.DW]866&W IRU WKH FRXUW 2j%ULHQ DOVR WHDFKHV WKDW ZKHWKHU H[LJHQW      )RU D ULJKW WR EH FOHDUO\ HVWDEOLVKHG FLUFXPVWDQFHV H[LVWHG mLV D TXHVWLRQ IRU WKH MXU\ SURYLGHG m>W@KHFRQWRXUVRIWKHULJKWPXVWEHVXIILFLHQWO\FOHDUWKDWD  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  EHOLHYH WKDW WKH $SSHOODQWjV YHUVLRQ RI WKH IDFWV GRHV QRW UHDVRQDEOHRIILFLDOZRXOGXQGHUVWDQGWKDWZKDWKHLVGRLQJ HVWDEOLVKFXOSDELOLW\ULVLQJDERYHQHJOLJHQFH7KHUHIRUHZH YLRODWHV WKDW ULJKWl 5XVVR Y &LW\ RI &LQFLQQDWL  )G DIILUP WKH GLVWULFW FRXUWjV GHFLVLRQ WR DZDUG VXPPDU\  WK&LU  TXRWLQJ$QGHUVRQY&UHLJKWRQ MXGJPHQWDVWRWKH$SSHOODQWjVZURQJIXOGHDWKFODLPV 86  m$OWKRXJKLWQHHGQRWEHWKHFDVH WKDW µWKH YHU\ DFWLRQ LQ TXHVWLRQ KDV EHHQ SUHYLRXVO\ KHOG ,,,&21&/86,21 XQODZIXOLQOLJKWRISUHH[LVWLQJODZWKHXQODZIXOQHVV PXVWEHDSSDUHQWjl,G TXRWLQJ$QGHUVRQ86DW  ,QVXPZH$)),50WKHGLVWULFWFRXUWjVJUDQWRIVXPPDU\ :KHWKHU TXDOLILHG LPPXQLW\ LV DSSOLFDEOH WR DQ RIILFLDOjV MXGJPHQWWRWKH'HIHQGDQWV$SSHOOHHVRQDOOFODLPVDVVHUWHG DFWLRQVLVDTXHVWLRQRIODZWKDWLVUHYLHZHGGHQRYR6HH E\WKH3ODLQWLII$SSHOODQW 'LFNHUVRQ)GDW :DUUDQWOHVV(QWU\ 7XUQLQJ ILUVW WR WKH $SSHOODQWjV ZDUUDQWOHVV HQWU\ FODLP DJDLQVW 2IILFHUV 3X]HOOD DQG 6FKQHOO ZH FRQFOXGH WKDW WKH GLVWULFW FRXUW FRUUHFWO\ IRXQG WKDW H[LJHQW FLUFXPVWDQFHV H[LVWHGWRMXVWLI\DZDUUDQWOHVVHQWU\$SROLFHRIILFHUjVHQWU\ LQWR D KRPH ZLWKRXW D ZDUUDQW LV SUHVXPSWLYHO\ XQFRQVWLWXWLRQDOXQGHUWKH)RXUWK$PHQGPHQW2j%ULHQY &LW\ RI *UDQG 5DSLGV  )G   WK &LU   :DUUDQWOHVVHQWULHVDUHSHUPLWWHGKRZHYHUZKHUHmH[LJHQW FLUFXPVWDQFHVlH[LVW+DQFRFNY'RGVRQ)G  WK &LU    ([LJHQW FLUFXPVWDQFHV H[LVW ZKHUH WKHUH DUH mµUHDO LPPHGLDWH DQG VHULRXV FRQVHTXHQFHVj WKDW ZRXOG FHUWDLQO\ RFFXU ZHUH D SROLFH RIILFHU WR µSRVWSRQH>@ DFWLRQWRJHWDZDUUDQWjl2j%ULHQ)GDW TXRWLQJ :HOVKY:LVFRQVLQ86  7KHUHOHYDQW LQTXLU\ LV ZKHWKHU WKH IDFWV DUH VXFK WKDW DQ REMHFWLYHO\ UHDVRQDEOHRIILFHUFRQIURQWHGZLWKWKH VDPHFLUFXPVWDQFHV FRXOGUHDVRQDEO\EHOLHYHWKDWH[LJHQWFLUFXPVWDQFHVH[LVWHG 'LFNHUVRQ)GDW7KUHHW\SHVRIFLUFXPVWDQFHV KDYH WUDGLWLRQDOO\ EHHQ IRXQG WR FRQVWLWXWH H[LJHQW FLUFXPVWDQFHVm  ZKHQWKHRIILFHUVZHUHLQKRWSXUVXLWRI D IOHHLQJ VXVSHFW   ZKHQ WKH VXVSHFW UHSUHVHQWHG DQ LPPHGLDWHWKUHDWWRWKHDUUHVWLQJRIILFHUVDQGSXEOLF  ZKHQ LPPHGLDWH SROLFH DFWLRQ ZDV QHFHVVDU\ WR SUHYHQW WKH GHVWUXFWLRQRIYLWDOHYLGHQFHRUWKZDUWWKHHVFDSHRINQRZQ FULPLQDOVl+DQFRFN)GDW  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  $OWKRXJK WKH GHWHUPLQDWLRQ RI H[LJHQW FLUFXPVWDQFHV LV IRU UHYLHZj DQG >D@Q DUJXPHQWj RQ HDFK LVVXH SUHVHQWHGl QRUPDOO\ D TXHVWLRQ IRU WKH MXU\ mLQ D FDVH ZKHUH WKH %LFNHOY.RUHDQ$LU/LQHV&R)G WK&LU XQGHUO\LQJIDFWVDUHHVVHQWLDOO\XQGLVSXWHGDQGZKHUHDILQGHU  FHUWGHQLHG86  $SSHOODQWjVEULHI RIIDFWFRXOGUHDFKEXWRQHFRQFOXVLRQDVWRWKHH[LVWHQFHRI RQDSSHDOGRHVQRWVSHFLILFDOO\PHQWLRQDQ\RIWKHVHFODLPV H[LJHQWFLUFXPVWDQFHVWKHLVVXHPD\EHGHFLGHGE\WKHWULDO QRUGRHVLWFRQWDLQDQ\DUJXPHQWDVWRZK\WKHGLVWULFWFRXUWjV FRXUWDVDPDWWHU RI ODZl,G,Q+DQFRFNZHIRXQGWKDW GHWHUPLQDWLRQ WKDW VXPPDU\ MXGJPHQW ZDV DSSURSULDWH RQ H[LJHQWFLUFXPVWDQFHVH[LVWHGDVDPDWWHURIODZZKHUHWKH WKHVHFODLPVZDVLQHUURU7KH$SSHOODQWjVDUJXPHQWVHFWLRQ SROLFH UHFHLYHG D FDOO FRQFHUQLQJ D VXLFLGDO DQG SRVVLEO\ $SSHOODQWjV %U DW  VXJJHVWV WKDW WKH GLVWULFW FRXUWjV KRPLFLGDOJXQPDQVKRWVKDGEHHQUHSRUWHGILUHGDQGDWOHDVW GHFLVLRQWRGLVPLVVWKHVWDWHODZFODLPVVKRXOGEHUHYHUVHG RQH UDGLR FRPPXQLFDWLRQ LQGLFDWHG WKDW WKH JXQPDQ KDG EDVHGXSRQWKHVDPHDUJXPHQWVDVVHUWHGDVWRWKH$SSHOODQWjV WKUHDWHQHG WR NLOO DQ\ SROLFH RIILFHUV ZKR DUULYHG  ,G FRQVWLWXWLRQDOFODLPV7KHGLVWULFWFRXUWjVRSLQLRQKRZHYHU 6LPLODUO\LQ'LFNHUVRQ)GDWZHFRQFOXGHGWKDW TXLWHFOHDUO\EDVHGLWVFRQFOXVLRQVDVWRWKHVWDWHODZFODLPV VXPPDU\ MXGJPHQW EDVHG XSRQ H[LJHQW FLUFXPVWDQFHV ZDV XSRQGLIIHUHQWJURXQGVWKDQLWVFRQVWLWXWLRQDOUXOLQJV7KHVH DSSURSULDWHZKHUHWKHSROLFHPDGHDQXQDQQRXQFHGIRUFLEOH JURXQGVDUHQRWDGGUHVVHGDQ\ZKHUHLQWKH$SSHOODQWjVEULHI HQWU\ZKLOHUHVSRQGLQJWRDFDOOUHSRUWLQJWKDWDGUXQNHQPDQ 7KHUHIRUHZHGHFOLQHWRFRQVLGHUWKHP ZDVVFUHDPLQJDQGKDGILUHGVKRWVLQKLVKRXVH$OWKRXJKLW ZDVODWHUGHWHUPLQHGWKDWWKHVXVSHFWZDVDORQHLQKLVKRXVH 5HDG OLEHUDOO\ WKH $SSHOODQWjV EULHI GRHV DGGUHVV WKH DQGZDVVFUHDPLQJLQWRWKHWHOHSKRQHZHGHWHUPLQHGWKDWLW GLVWULFWFRXUWjVJUDQWRIVXPPDU\MXGJPHQWDVWRWKHZURQJIXO ZDVUHDVRQDEOHIRUWKHSROLFHWREHOLHYHWKDWVRPHRQHZDVLQ GHDWK FODLPV LQVRIDU DV LW FKDOOHQJHV WKH GLVWULFW FRXUWjV WKHKRXVHDQGZDVLQLPPHGLDWHSHULORIERGLO\KDUPJLYHQ FRQFOXVLRQWKDWWKHGHDWKVRI0U/HNDQDQGKLVVRQZHUHQRW WKH SUHVHQFH RI D ILUHDUP DQG WKH VXVSHFWjV DSSDUHQW SUR[LPDWHO\ FDXVHG E\ WKH GHIHQGDQWV  1HYHUWKHOHVV DV ZLOOLQJQHVVWRXVHKLVZHDSRQ,G HPSOR\HHV RI D SROLWLFDO VXEGLYLVLRQ WKH LQGLYLGXDO GHIHQGDQWV DUH HQWLWOHG WR VWDWXWRU\ LPPXQLW\ XQOHVV WKHLU 6LPLODUIDFWVZHUHSUHVHQWKHUH7KHGLVWULFWFRXUWUHOLHG mDFWVRURPLVVLRQVZHUHZLWKPDOLFLRXVSXUSRVHLQEDGIDLWK XSRQIDFWVZKLFKVKRZHGWKDWDWWKHWLPHRIWKHLQLWLDOHQWU\ RULQDZDQWRQRUUHFNOHVVPDQQHUl2+,2 5(9 &2'( $ †  $  E  %DQNV%DOGZLQ :HVW    7KH WKHRIILFHUVKDGFUHGLEOHHYLGHQFHWKDW  sRKQ/HNDQ VWDQGDUGIRUUHFNOHVVQHVVHPSOR\HGE\2KLRFRXUWVKROGVWKDW ZDV D PHQWDOO\ GLVWXUEHG PDQ ZKR ZDV YRODWLOH m>W@KHDFWRUjVFRQGXFWLVLQUHFNOHVVGLVUHJDUGRIWKHVDIHW\RI GDQJHURXV DQG QRW WDNLQJ KLV SUHVFULEHG PHGLFDWLRQ RWKHUVLIVXFKULVNLVVXEVWDQWLDOO\JUHDWHUWKDQWKDWZKLFK  KHUHFHQWO\EHJDQEUDQGLVKLQJDVKRWJXQLQIURQWRI LV QHFHVVDU\ WR PDNH KLV FRQGXFW QHJOLJHQWl  )DEUH\ Y KRPH KHDOWK FDUH SHUVRQQHO LQ D WKUHDWHQLQJ PDQQHU 0F'RQDOG 9LOODJH 3ROLFH 'HSjW  1(G   2KLR  KHWROGKLVEURWKHUWKHQLJKWEHIRUHWKDWKLVJXQVZHUH   TXRWDWLRQRPLWWHG $VZHKDYHDOUHDG\H[SODLQHGZH mORDGHG DQG UHDG\l   KH LQH[SOLFDEO\ NHSW KLV VRQ KRPHIURPVFKRROWKDWGD\DQG  KLVZLIHXQH[SHFWHGO\ DVNHGWREHSXWLQWRDQXUVLQJKRPHWKDWPRUQLQJ  7KH RQH H[FHSWLRQ WR WKLV REVHUYDWLRQ LV WKH GLVWULFW FRXUWjV s$DW 'LVW&W2SDW ,QDGGLWLRQWKHXQGLVSXWHG GLVFXVVLRQ RI WKH WUHVSDVV FODLP s$ DW  'LVW &W 2S DW   HYLGHQFHVKRZHGWKDW2IILFHUV3X]HOODDQG6FKQHOOREVHUYHG 7KH VROH JURXQGV DVVHUWHG E\ WKH GLVWULFW FRXUW IRU JUDQWLQJ VXPPDU\ MXGJPHQW RQ WKH WUHVSDVV FODLP ZDV LWV FRQFOXVLRQ WKDW H[LJHQW 0U /HNDQ EHKDYLQJ HUUDWLFDOO\ LPPHGLDWHO\ SULRU WR WKHLU FLUFXPVWDQFHV MXVWLILHG WKH RIILFHUVj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m>R@QHFRXOGUHDVRQDEO\FRQVWUXHWKLVDVD DEXVHVRISRZHU:HWKHUHIRUHFRQFOXGHWKDWWKHGLVWULFWFRXUW VLJQWKDW0U/HNDQZDVKLGLQJVRPHWKLQJKROGLQJKLVIDPLO\ FRUUHFWO\JUDQWHGVXPPDU\MXGJPHQWWRWKHGHIHQGDQWVDVWR KRVWDJHRUSUHYHQWLQJWKHSROLFHIURP>VWRSSLQJ@ZKDWHYHU WKH$SSHOODQWjV)RXUWHHQWK$PHQGPHQWFODLP DFWLRQKHKDGSODQQHGls$DW 'LVW&W2SDW 7KLV GUDPDWLFUHDFWLRQFRPELQHGZLWKWKHRIILFHUVjNQRZOHGJHWKDW &0XQLFLSDO/LDELOLW\ KHZDVDUPHGDQGYRODWLOHDQGWKDWKLVZLIHDQGFKLOGZHUHLQ WKHKRXVHZLWKKLPUHYHDOVDQXQGLVSXWHGERG\RIHYLGHQFH +DYLQJ FRQFOXGHG WKDW WKH $SSHOODQW KDV QRW VKRZQ D IURP ZKLFK D UHDVRQDEOH RIILFHU FRXOG KDYH UHDVRQDEO\ JHQXLQH LVVXH RI PDWHULDO IDFW DV WR DQ\ RI WKH DVVHUWHG FRQFOXGHGWKDWWKHUHZDVDQLPPHGLDWHWKUHDWWR0U/HNDQjV FRQVWLWXWLRQDOFODLPVZHWKHUHIRUHFRQFOXGHWKDWWKHGLVWULFW ZLIHDQGVRQ FRXUWFRUUHFWO\GLVPLVVHGWKH$SSHOODQWjVPXQLFLSDOOLDELOLW\ FODLPV:KHUHDVKHUHDPXQLFLSDOLW\jVOLDELOLW\LVDOOHJHGRQ 7KH GDQJHU WR 0U /HNDQjV IDPLO\ PDNHV WKLV DQ HYHQ WKHEDVLVRIWKHXQFRQVWLWXWLRQDODFWLRQVRILWVHPSOR\HHVLWLV VWURQJHUFDVHIRUH[LJHQWFLUFXPVWDQFHVWKDQ+DQFRFN QHFHVVDU\WRVKRZWKDWWKHHPSOR\HHVLQIOLFWHGDFRQVWLWXWLRQDO )G  ZKHUH WKHUH ZDV QR HYLGHQFH RI DQ\ SRWHQWLDO KDUP  &LW\ RI /RV $QJHOHV Y +HOOHU  86   KRVWDJHV7KHSUHVHQFHRIKRVWDJHVDOVRGLVWLQJXLVKHVWKH   m>1@HLWKHU 0RQHOO    QRU DQ\ RWKHU RI RXU FDVHV DXWKRUL]HV WKH DZDUG RI GDPDJHV DJDLQVW D PXQLFLSDO FRUSRUDWLRQEDVHGRQWKHDFWLRQVRIRQHRILWVRIILFHUVZKHQLQ  IDFW WKH MXU\ KDV FRQFOXGHG WKDW WKH RIILFHU LQIOLFWHG QR :H UHVSHFWIXOO\ GLVDJUHH ZLWK sXGJH +XOOjV FKDUDFWHUL]DWLRQ RI WKH FRQVWLWXWLRQDO KDUPl   %HFDXVH QR VXFK FRQVWLWXWLRQDO GLVWULFW FRXUW RSLQLRQ DV KDYLQJ mH[SUHVVO\ UHFRJQL]HG DQ H[LVWLQJ PDWHULDO YLRODWLRQ KDV EHHQ VKRZQ ZH DIILUP WKH GLVWULFW FRXUWjV GLVSXWH RI IDFW LQ UHJDUG WR H[LJHQW FLUFXPVWDQFHVl 'LVVHQW DW   7KH SRUWLRQ RI WKH GLVWULFW FRXUW RSLQLRQ H[FHUSWHG LQ sXGJH +XOOjV GLVVHQW GHFLVLRQ JUDQWLQJ VXPPDU\ MXGJPHQW WR WKH &LW\ RQ WKH PHUHO\ UHVWDWHV WKH SODLQWLIIjV FODLPV WKDW WKH SROLFH ZHUH QRW DZDUH RI $SSHOODQWjVPXQLFLSDOOLDELOLW\FODLP H[LJHQW FLUFXPVWDQFHV EHIRUH DUULYLQJ DW WKH /HNDQ KRXVH DQG WKDW WKH SROLFH GLG QRW GLUHFWO\ ZLWQHVV D FULPH EHLQJ FRPPLWWHG RU 0U /HNDQ '6WDWH/DZ&ODLPV WKUHDWHQLQJ DQ\ERG\ $V LV H[SODLQHG LQ WKLV RSLQLRQ LQIUD DQG LQ WKH GLVWULFW FRXUW RSLQLRQ WKHVH IDFWV GR QRW UDLVH D JHQXLQH LVVXH DV WR :HDOVRKROGWKDWWKH$SSHOODQWjVVWDWHODZFODLPVZHUH ZKHWKHU H[LJHQW FLUFXPVWDQFHV H[LVWHG DW WKH WLPH WKH SROLFH PDGH WKH SURSHUO\ GLVPLVVHG  ,QLWLDOO\ ZH FRQFOXGH WKDW WKH GHFLVLRQ WR HQWHU WKH /HNDQ KRXVH 7KH GLVWULFW FRXUW WKHUHIRUH GLG QRW mH[SUHVVO\ UHFRJQL]Hl D JHQXLQH LVVXH RI PDWHULDO IDFW DV LW XOWLPDWHO\ $SSHOODQWjV FODLPV IRU DVVDXOW DQG EDWWHU\ LQWHQWLRQDO JUDQWHG VXPPDU\ MXGJPHQW WR WKH GHIHQGDQWV RQ WKH SODLQWLIIVj )RXUWK LQIOLFWLRQ RI HPRWLRQDO GLVWUHVV DQG FLYLO FRQVSLUDF\ ZHUH $PHQGPHQW FODLPV ZDLYHGE\WKH$SSHOODQWjVIDLOXUHWRDGGUHVVWKHPLQKLVEULHI  WRWKLVFRXUW6HH$KOHUVY6FKHELO)G WK 2XU XVH RI WKH WHUP mKRVWDJHl LV LQWHQGHG PHUHO\ WR VLJQLI\ WKDW 0UV &LU  ILQGLQJSODLQWLIIVDSSHDOLQJVXPPDU\MXGJPHQWLQ /HNDQ DQG KHU VRQ ZHUH XQGHU WKH FRQWURO RI 0U /HNDQ ZKR ZDV DUPHG †  DFWLRQ KDG ZDLYHG D QXPEHU RI WKHLU VWDWH ODZ WRUW DQG SRWHQWLDOO\ KRPLFLGDO DQG ZHUH LQ VHULRXV GDQJHU RI EHLQJ KDUPHG FODLPVE\IDLOLQJWRDGGUHVVWKHPLQWKHLUDSSHOODWHEULHIV  :H UHFRJQL]H WKDW WKLV PD\ GLIIHU IURP WKH GHILQLWLRQ RI mKRVWDJHl m)HGHUDO5XOHRI$SSHOODWH3URFHGXUH D UHTXLUHVWKDWDQ HPSOR\HG LQ WKH &DOOLV UHSRUW ZKLFK UHTXLUHV WKDW WKH mKRVWDJHl EH XVHG WR VHFXUH VXEVWDQWLYH GHPDQGV LQ D EDUJDLQLQJ SURFHVV 1HYHUWKHOHVV ZH DSSHOODQWjVEULHILQFOXGHµDVWDWHPHQWRIWKHLVVXHVSUHVHQWHG GLVDJUHH ZLWK sXGJH +XOO WKDW WKH IDFW WKDW 0U /HNDQ ZDV QRW PDNLQJ  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  LQVWDQWFDVHIURPWKRVHFLWHGE\WKH$SSHOODQWLQZKLFKWKLV FDVHVVXFKDVWKLVRQHLQZKLFKRIILFHUVPXVWFKRRVHDPRQJ FRXUWGHFOLQHGWRILQGH[LJHQWFLUFXPVWDQFHV6HH2j%ULHQ ULVNVDSODLQWLIIPXVWVKRZWKDWWKHSROLFHmNQRZLQJO\DQG )G DW  ILQGLQJ DEVHQFH RI H[LJHQW FLUFXPVWDQFHV XQUHDVRQDEO\lRSWHGIRUDFRXUVHRIFRQGXFWWKDWHQWDLOHGD ZKHUHQRKRVWDJHVZHUHSUHVHQW 8QLWHG6WDWHVYs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nHYHQWKRXJKWKLVWXUQHGRXWWRQRWEHWKHFDVHnLQ ILQGLQJWKDWH[LJHQWFLUFXPVWDQFHVH[LVWHGDVDPDWWHURIODZ $SSHOODQWjV DOOHJDWLRQ WKDW EHWWHU HTXLSPHQW VXFK DV ,QWKHLQVWDQWFDVHWKHSROLFHKDGDFWXDONQRZOHGJHWKDW0U WKHUPDOLPDJLQJWHFKQRORJ\ZKLFKFRXOGKDYHLPSURYHGWKH /HNDQjVZLIHDQGVRQZHUHLQVLGHDQGWKHDSSDUHQWWKUHDWWR FKDQFHVIRUDVXFFHVVIXODVVDXOWZRXOGKDYHEHHQDYDLODEOHWR WKHPZDVHQKDQFHGE\WKHIDFWWKDW0UV/HNDQKDGHDUOLHU &KLHI%H\HULIKHKDGZDLWHGORQJHUWRRUGHUWKHDVVDXOWLV VRXJKWWREHWDNHQRXWRIWKHKRXVHDQGWKDW0U/HNDQKDG VLPLODUO\XQDYDLOLQJ$VWDWHRIILFLDOjVGHFLVLRQWRLQLWLDWHD NHSWKLVVRQKRPHIURPVFKRRO UHVFXHZLWKVXERSWLPDOHTXLSPHQWVRXQGVLQQHJOLJHQFHQRW GHOLEHUDWH UHFNOHVVQHVV  6HH 6DODV  )G DW  7KH $SSHOODQW HPSKDVL]HV WKDW WKH SROLFH DGPLWWHG WKDW ,QGHHGLQWKHLQVWDQWFDVHWKH$SSHOODQWKDVQRWFRQWUDGLFWHG H[LJHQWFLUFXPVWDQFHVZHUHQRWSUHVHQWEHIRUHWKH\DUULYHGDW &KLHI %H\HUj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mKRVWDJHl LQ WKH VHQVH WKDW WHUP LV XVHG E\ &DOOLV FUHDWHV D PDWHULDO IDFW TXHVWLRQ DV WR WKH H[LVWHQFH RI H[LJHQW FLUFXPVWDQFHV 7KH NH\ LVVXH LQ H[SHUWVLQWKLVFDVHVHHPWRDJUHHZLWKWKHGLVWULFWFRXUWWKDW GHWHUPLQLQJ ZKHWKHU H[LJHQW FLUFXPVWDQFHV H[LVWHG LV ZKHWKHU WKH RIILFHUV m>D@UPHGWDFWLFDOVROXWLRQVDUHUDGLFDOVWUDWHJLHVXVHGRQO\DV UHDVRQDEO\ EHOLHYHG WKDW mWKH VXVSHFW UHSUHVHQWHG DQ LPPHGLDWH WKUHDW WR DODVWUHVRUWLQKRVWDJHVLWXDWLRQVlDQGWKDWm>X@VHRILWKHUH WKH    SXEOLFl +DQFRFN   )G DW  QRW ZKHWKHU WKH VXVSHFW ZDV ZDV SUHPDWXUHl  s$ DW  'LVW &W 2S DW  Q  PDNLQJ VXEVWDQWLYH GHPDQGV LQ FRQQHFWLRQ ZLWK VXFK D WKUHDW $V WR WKLV 0RUHRYHU WKH DVVDXOW LWVHOI ZDV SRRUO\ SODQQHG DQG LW TXHVWLRQ WKH SRUWLRQ RI WKH &DOOLV UHSRUW TXRWHG LQ sXGJH +XOOjV GLVVHQW FRQFHGHV WKDW DOWKRXJK 0UV /HNDQ DQG KHU VRQ mZHUH QRW DFWXDOO\ DSSHDUVWKDWWKHSROLFHODFNHGWKHSHUVRQQHODQGHTXLSPHQWWR KRVWDJHVl WKH\ mZHUH YLFWLPV RI 0U /HNDQjV DFWLRQV 7KH\ ZHUH LQ WKH FDUU\LWRXWVXFFHVVIXOO\7KHGHFLVLRQWRGHSOR\DQDUPRUHG UHVLGHQFH ZKHQ 0U /HNDQ FRPPLWWHG KLV FULPLQDO DFW DQG KH DIIRUGHG YHKLFOH VHHPV SDUWLFXODUO\ LPSUXGHQW ZKHQ FRQIURQWLQJ D WKHP QR RSSRUWXQLW\ WR OHDYHl s$ DW   (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  ERDW@ IURP HQGDQJHULQJ KHU OLIH LQ WKH FRXUVH RI D SROLFH  0RUHRYHUWKLVFRXUWKDVQHYHUKHOGWKDWWKHSROLFH UHVFXHHIIRUWl,GDW PXVWZLWQHVVDFULPHIRUH[LJHQWFLUFXPVWDQFHVWREHSUHVHQW ,Q +DQFRFN  )G DW  IRU H[DPSOH WKH GHIHQGDQW )LQDOO\LQ.HSQHUY+RXVWRXQ)6XSSG (' RIILFHUVj LQIRUPDWLRQ UHJDUGLQJ H[LJHQW FLUFXPVWDQFHV ZDV 3D   WKH FRXUW DGGUHVVHG D IDFWXDO VLWXDWLRQ FORVHO\ OLPLWHGWRUHSRUWVWKH\UHFHLYHGIURPDUDGLRGLVSDWFK:KHUH DQDORJRXVWRWKHLQVWDQWFDVH,Q.HSQHUDQDUPHGLQGLYLGXDO DVKHUHDQDUPHGDQGYRODWLOHLQGLYLGXDOSRVHVDQREYLRXV ZKR ZDV DOVR D GLDJQRVHG VFKL]RSKUHQLF WRRN KLV IRUPHU WKUHDWWRDQRWKHUZHGRQRWEHOLHYHWKH)RXUWK$PHQGPHQW HPSOR\HUDQGDQRWKHUSHUVRQKRVWDJHDQGEDUULFDGHGKLPVHOI UHTXLUHVWKHSROLFHWRVWDQGLGO\E\XQWLOWKH\DFWXDOO\REVHUYH LQWKHHPSOR\HUjVRIILFH$WZRGD\VWDQGRIIHQVXHG7KH DFULPLQDODFW6LPLODUO\DOWKRXJKWKHSROLFHPD\QRWKDYH SROLFHXOWLPDWHO\GHFLGHGWRXQGHUWDNHDWDFWLFDODVVDXOWDIWHU SHUVRQDOO\KHDUGDQ\WKUHDWVWKH\ZHUHDZDUHRI0U/HNDQjV WKHKRVWDJHWDNHUjVGHPDQGVEHFDPHLQFUHDVLQJO\HUUDWLF$V WKUHDWHQLQJ EHKDYLRU  0RUHRYHU WKH XQGLVSXWHG HYLGHQFH WKHSROLFHVWRUPHGWKHRIILFHWKHKRVWDJHWDNHUVKRWDQGNLOOHG LQGLFDWHV WKDW 2IILFHU 6FKQHOO ZDV DZDUH RI 0U /HNDQjV RQH RI WKH KRVWDJHV  ,G DW   7KH FRXUW IRXQG WKDW WKH VWDWHPHQWWKDWKLVJXQVZHUHmORDGHGDQGUHDG\l FRQGXFWRIWKHSROLFHLQXQGHUWDNLQJDWDFWLFDODVVDXOWGLGQRW VKRFNWKHFRQVFLHQFHXQGHUHLWKHUWKHLQWHQWWRKDUPRUWKH :HDUHDOVRXQSHUVXDGHGE\WKH$SSHOODQWjVFODLPWKDWWKH GHOLEHUDWH LQGLIIHUHQFH VWDQGDUG  ,G DW   $V WKH FRXUW GHIHQGDQW RIILFHUV LPSHUPLVVLEO\ FUHDWHG WKH H[LJHQW H[SODLQHG FLUFXPVWDQFHV E\ LQLWLDOO\ DWWHPSWLQJ WR VHH 0UV /HNDQ ZLWKRXW LGHQWLI\LQJ WKHPVHOYHV DV SROLFH RIILFHUV  7KH :KLOH WKHLU DFWLRQ VXUHO\ KDG JUDYH ULVNV WDNLQJ QR $SSHOODQWUHOLHVXSRQ8QLWHG6WDWHVY0RUJDQ)GDW DFWLRQDOVRKDGJUDYHULVNV,WLVLPSRUWDQWWRUHPHPEHU LQZKLFKZHREVHUYHGWKDWm>S@ROLFHRIILFLDOVDUHQRW WKDW &]DMNRZVNL ZLWK VHULRXV PHQWDO SUREOHPV KDG IUHH WR FUHDWH H[LJHQW FLUFXPVWDQFHV WR MXVWLI\ WKHLU SUHYLRXVO\ VKRW sRUGDQ DQG ZDV PDNLQJ GHPDQGV WKDW ZDUUDQWOHVVLQWUXVLRQVl7KH0RUJDQFDVHKRZHYHULVHDVLO\ ZHUHEHFRPLQJLQFUHDVLQJO\EL]DUUH,QKLQGVLJKWPD\EH GLVWLQJXLVKHG,Q0RUJDQWKHSROLFHVXUURXQGHGWKHKRPHRI WKHVWDWHSROLFHZHUHQHJOLJHQWDQGVKRXOGKDYHWDNHQD DSHUVRQVXVSHFWHGRISRVVHVVLQJLOOHJDOILUHDUPVDQGIORRGHG GLIIHUHQW SDWK EXW QHJOLJHQFH LV QRW WKH DSSOLFDEOH WKHKRXVHZLWKOLJKWVZKLOHVXPPRQLQJWKHVXVSHFWZLWKWKH FRQVWLWXWLRQDOVWDQGDUG mEODULQJFDOORIDEXOOKRUQl,GDW7KHVXVSHFWH[LWHG WKHKRXVHFDUU\LQJDSLVWROZKLFKKHWKHQVHWGRZQLQVLGHWKH ,G GRRUZD\ RI WKH KRXVH  7KH SROLFH DUUHVWHG KLP DQG WKHQ VHDUFKHGWKHKRXVHVHL]LQJDQXPEHURIILUHDUPVLQFOXGLQJ 9LHZLQJWKHLQVWDQWIDFWVLQOLJKWRIWKHIRUHJRLQJFDVHVZH WKH SLVWRO  ,G  :H KHOG WKDW WKH ZDUUDQWOHVV VHDUFK RI WKH FRQFOXGHWKDWWKH$SSHOODQWKDVQRWVKRZQVXIILFLHQWIDFWVWR KRPH ZDV QRW MXVWLILHG E\ H[LJHQW FLUFXPVWDQFHV  :H VXSSRUWDFODLPRIGHOLEHUDWHLQGLIIHUHQFH+HUHWKHSROLFH H[SODLQHG WKDW m>W@KHUH ZDV QR VXEVWDQWLDWHG HYLGHQFH WKDW DWWHPSWHGWRUHVFXH0UV/HNDQDQGKHUVRQIURPDWKUHDWRI 0RUJDQZDVGDQJHURXVRUWKDWDJUDYHRIIHQVHRUFULPHRI SULYDWHYLROHQFH,WLVXQGLVSXWHGWKDWWKHUHZDVQRFOHDUZD\ YLROHQFHKDGRFFXUUHGRUZDVHYHQWKUHDWHQHGl,GDW RXWRIGDQJHUDQGDQ\FRXUVHSXUVXHGE\WKHSROLFHHQWDLOHG :H HPSKDVL]HG WKH ODFN RI DQ\ GHPRQVWUDWHG QHHG IRU VLJQLILFDQWULVNV7KH$SSHOODQWDWEHVWKDVVKRZQWKDW&KLHI LPPHGLDWHDFWLRQQRWLQJWKDWWKHSROLFHKDGVXIILFLHQWWLPHWR %H\HU VKRXOG KDYH REWDLQHG PRUH LQIRUPDWLRQ IURP WKH PHHWDWDORFDOFRIIHHVKRSDQGmDVVHVV>@WKHVLWXDWLRQl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jVRIILFH WKHLQVWDQWFDVHE\FRQWUDVW2IILFHUV3X]HOODDQG6FKQHOOGLG DQGWRRNKHUKRVWDJH%HIRUHWKHFLW\SROLFHFRXOGGHSOR\ KDYHUHDVRQWREHOLHYHWKDWWKHUHZDVDGDQJHURIYLROHQFH KRZHYHUWKHFRXQW\VKHULIIRUGHUHGWKHPWROHDYHDVVHUWLQJ $OWKRXJKWKLVWKUHDWPD\KDYHULVHQWRWKHOHYHORIH[LJHQW KLVH[FOXVLYHMXULVGLFWLRQRYHUFRXUWKRXVHVHFXULW\,GDW FLUFXPVWDQFHVRQO\DIWHUWKHRIILFHUVLGHQWLILHGWKHPVHOYHVWR 7KHVKHULIIjVGHSDUWPHQWGLGQRWSRVVHVVWKHVDPHH[SHULHQFH 0U/HNDQWKHULVNWR0UV/HNDQDQGKHUVRQZDVQRWFUHDWHG FDSDELOLWLHVRUHTXLSPHQWIRUGHDOLQJZLWKKRVWDJHVLWXDWLRQV VROHO\E\WKHRIILFHUVj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mFXWRIIDOODYHQXHVRIUHVFXHZLWKRXWSURYLGLQJDQ WKHHYLGHQFHVKRZVWKDWWKHSROLFHFRQWUROOHGWKHWLPLQJRIWKH DOWHUQDWLYHl,GDW5DWKHUWKHRIILFHUVmFRQWUROOHGWKH HQFRXQWHU JLYLQJ ULVH WR WKH VHDUFK  6HH 8QLWHG 6WDWHV Y FRQGXFWRIDSROLFHUHVFXHFRQVLGHULQJIDFWRUVVXFKDVWKH &DPSEHOO)G WK&LU  QRWLQJWKDW VDIHW\RIWKRVHLQYROYHGl,G7KHPHUHIDFWWKDWWKHVKHULIIjV LQFDVHVIURPWKH(LJKWK&LUFXLWKROGLQJFRQWUROOHGGHOLYHULHV GHSDUWPHQWGLGQRWSRVVHVVWKHEHVWDYDLODEOHHTXLSPHQWGLG WREHH[LJHQWFLUFXPVWDQFHVFUHDWHGE\WKHSROLFHmWKHSROLFH QRW UHQGHU WKH GHFLVLRQ WR KDQGOH WKH VWDQGRII FRQVFLHQFH KDG WKH RSSRUWXQLW\ WR REWDLQ D VHDUFK ZDUUDQW SULRU WR VKRFNLQJ,GDW H[HFXWLQJWKHFRQWUROOHGGHOLYHU\DWWKDWGZHOOLQJEXWFKRVH QRWWRGRVRl 86Y&UHVWD)G VW&LU ,Q$QGUHZV)GDWWKH'&&LUFXLWDGGUHVVHG   m7KXVWKHDJHQWVFRXOGQRWKDYHFRQWUROOHGWKHWLPH D )RXUWHHQWK $PHQGPHQW FODLP DVVHUWHG RQ EHKDOI RI D DWZKLFKWKHIDNHGHOLYHU\WRRNSODFHZKLFKLVDQHFHVVDU\ VXVSHFWZKRGURZQHGZKLOHDWWHPSWLQJWRHYDGHWKHSROLFH HOHPHQWWRDILQGLQJWKDWWKHJRYHUQPHQWGHOLEHUDWHO\FUHDWHG 7KHVXVSHFWGRYHLQWRDFKDQQHODIWHUEHLQJFRQIURQWHGE\D WKH H[LJHQW FLUFXPVWDQFHVl  FHUW GHQLHG  86  SROLFHRIILFHU:KHQWKHVXVSHFWEHJDQWRGURZQWKHRIILFHU   KDLOHGDSULYDWHERDWWRDVVLVWWKHPDQ6HHLQJWKDWWKHVXVSHFW ZDVXQFRQVFLRXVDZRPDQRQWKHERDWWROGWKHRIILFHUVKH 0RUHRYHU WKH FUHDWHGH[LJHQF\ FDVHV KDYH W\SLFDOO\ QHHGHGWRGLYHLQWRVDYHKLPDQGLQIRUPHGWKHRIILFHUWKDW UHTXLUHGVRPHVKRZLQJRIGHOLEHUDWHFRQGXFWRQWKHSDUWRI VKHKDGEHHQWUDLQHGWRH[HFXWHVXFKDUHVFXH,G7KHRIILFHU WKHSROLFHHYLQFLQJDQHIIRUWLQWHQWLRQDOO\WRHYDGHWKHZDUUDQW GLUHFWHGKHUQRWWRJRLQWRWKHZDWHUEHFDXVHWKHGURZQLQJ UHTXLUHPHQW6HH&DPSEHOO)GDW m7KLV&RXUWKDV PDQZDVDQHVFDSHGSULVRQHUDQGFRXOGEHGDQJHURXV,G VWUXFN GRZQ ZDUUDQWOHVV HQWULHV E\ WKH SROLFH LQ VLWXDWLRQV 7KHFRXUWFRQFOXGHGWKDWWKHRIILFHUjVDFWLRQRILQWHUIHULQJ ZKHUHGHOLEHUDWHFRQGXFWRQWKHSDUWRISROLFHRIILFHUVKDV ZLWKWKHSULYDWHFLWL]HQjVUHVFXHHIIRUWGLGQRWGHPRQVWUDWHD FUHDWHGWKHFODLPHGH[LJHQWFLUFXPVWDQFHVl 8QLWHG6WDWHVY UHFNOHVVGLVUHJDUGIRUWKHVXVSHFWjVVDIHW\,GDW7KH 9RQ:LOOLH)G WK&LU  m7KLVLVQRWD FRXUWH[SODLQHGWKDWLWLVQRWDFRQVWLWXWLRQDOYLRODWLRQmIRUD FDVHZKHUHWKHJRYHUQPHQWSXUSRVHO\WULHGWRFLUFXPYHQWWKH VWDWHRIILFHUWRDWWHPSWDQLQHIIHFWXDOUHVFXHlDQGWKHUHIRUH UHTXLUHPHQWV RI >WKH NQRFN DQG DQQRXQFH VWDWXWH@l   7KH PHUHQHJOLJHQFHRQWKHSDUWRIWKHRIILFHUVLQWKHFRQGXFWRI $SSHOODQWKDVSUHVHQWHGQRHYLGHQFHWRLQGLFDWHWKDW2IILFHUV WKHUHVFXHGLGQRWVWDWHD)RXUWHHQWK$PHQGPHQWYLRODWLRQ 6FKQHOO DQG 3X]HOOD PDGH D GHOLEHUDWH HIIRUW WR LQFLWH 0U ,GDW0RUHRYHUWKHFRXUWH[SODLQHGm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jVHPHUJHQF\ /HNDQKRPHDQGDWWHPSWWROHDUQPRUHWKURXJKFRQVHQVXDO WHDP  0RUHRYHU LW VHHPV IURP WKH UHFRUG WKDW HYHU\RQH TXHVWLRQLQJRI0U/HNDQ8QLWHG6WDWHVYsRQHV)G DJUHHGDWWKHWLPHWKDWWKHUHZDVOLWWOHLIDQ\SURVSHFWIRU   WK &LU  m)HGHUDO FRXUWV KDYH UHFRJQL]HG WKH VXFFHVVIXOUHVROXWLRQWRWKHFULVLVWKURXJKQHJRWLDWLRQ0U µNQRFNDQGWDONjVWUDWHJ\DVDUHDVRQDEOHLQYHVWLJDWLYHWRRO /HNDQ PDGH QR GHPDQGV DQG ZDV QRW FRPPXQLFDWLQJ ZKHQRIILFHUVVHHNWRJDLQDQRFFXSDQWjVFRQVHQWWRVHDUFKRU FRKHUHQWO\ZLWKWKHQHJRWLDWRU*LYHQWKHJULPSURVSHFWIRU ZKHQ RIILFHUV UHDVRQDEO\ VXVSHFW FULPLQDO DFWLYLW\l  FHUW QHJRWLDWLRQVLWZDVUHDVRQDEOHIRU&KLHI%H\HUWRFRQFOXGH GHQLHG 86  6 &W     :KHQ DQ RIILFHU WKDWDWDFWLFDOVROXWLRQZRXOGEHUHTXLUHGHYHQWXDOO\ REVHUYHV IDFWV JLYLQJ ULVH WR H[LJHQW FLUFXPVWDQFHV LQ WKH FRXUVHRIVXFKDFRQVHQVXDOHQFRXQWHULWXVXDOO\FDQQRWEH 9LHZHGDJDLQVWWKLVEDFNGURSZHGRQRWWKLQNLWZRXOGEH VDLG WKDW WKH RIILFHU LPSHUPLVVLEO\ mFUHDWHGl WKH H[LJHQW DSSURSULDWH WR VD\ WKDW &KLHI %H\HU DFWHG ZLWK FDOORXV FLUFXPVWDQFHV,G$OWKRXJK2IILFHUV6FKQHOODQG3X]HOODjV LQGLIIHUHQFHWRWKHULVNRILQMXU\WR0UV/HNDQRUKHUVRQ VWUDWHJLFGHFLVLRQQRWWRLGHQWLI\WKHPVHOYHVLPPHGLDWHO\PD\ ,QVWHDG LW DSSHDUV WKDW &KLHI %H\HU PDGH D GHFLVLRQ WKDW KDYHEHHQLOODGYLVHGDQGPD\HYHQKDYHFRQWULEXWHGWR0U UHTXLUHG D EDODQFLQJ RI WKH ULVNV SUHVHQWHG E\ DJJUHVVLYH /HNDQjVDJLWDWLRQWKLVFRQGXFWGLGQRWJLYHULVHWRDFODLP DFWLRQDJDLQVWWKHULVNVSUHVHQWHGE\IXUWKHUGHOD\7KLVLVQRW WKDWWKHSROLFHLPSHUPLVVLEO\FUHDWHGWKHH[LJHQF\ D VLWXDWLRQ ZKHUH WKH SROLFH GHOLEHUDWHO\ UHIXVHG WR WDNH REYLRXVVWHSVWKDWZRXOGGHFUHDVHWKHULVNRUDEDQGRQHGWKH (YHQ LI JHQXLQH LVVXHV RI PDWHULDO IDFW GLG H[LVW DV WR /HNDQV LQ D GDQJHURXV HQYLURQPHQW  6HH /HIIDOO Y 'DOODV ZKHWKHU D UHDVRQDEOH RIILFHU ZRXOG KDYH SHUFHLYHG DQ ,QGHS6FK'LVW)G WK&LU ,QVWHDG LPPHGLDWHWKUHDWWRWKH/HNDQVZHZRXOGVWLOOILQGVXPPDU\ WKH $SSHOODQW FKDOOHQJHV &KLHI %H\HUjV FKRLFH DPRQJ QHFHVVDULO\ULVN\DOWHUQDWLYHWDFWLFVLQXQGHUWDNLQJDQHIIRUWWR UHVFXH 0UV /HNDQ DQG KHU VRQ IURP GDQJHU  0HUHO\  :H WKHUHIRUH UHVSHFWIXOO\ GLVDJUHH ZLWK sXGJH +XOOjV VXJJHVWLRQ WKDW GHPRQVWUDWLQJ WKDW &KLHI %H\HU LQFRUUHFWO\ DVVHVVHG WKH WKH &DOOLV UHSRUWjV FULWLFLVPV RI WKH %UXQVZLFN 3ROLFH 'HSDUWPHQWjV FRPSHWLQJ ULVNV PD\ GHPRQVWUDWH QHJOLJHQFH RQ &KLHI mZHOIDUH FKHFNl SURFHGXUH FUHDWHV D JHQXLQH LVVXH RI PDWHULDO IDFW DV WR %H\HUj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mFUHDWHG WKH H[LJHQF\l DV WKDW FRQFHSW LV XQGHUVWRRG LQ )RXUWK $PHQGPHQW MXULVSUXGHQFH ZKHWKHU RU QRW SROLFH WDFWLFV ZHUH KXVEDQG DIWHU D GD\ORQJ VWDQGRII ZLWK WKH SROLFH DW WKH SDUW RI WKH FDXVDO FKDLQ UHVXOWLQJ LQ WKH H[LJHQF\ LV QRW PDWHULDO WR WKH FRXUWKRXVHZKHUHWKHYLFWLPZRUNHG&LW\SROLFHHTXLSSHG TXHVWLRQ RI ZKHWKHU WKH ZDUUDQWOHVV HQWU\ ZDV MXVWLILHG E\ H[LJHQW FLUFXPVWDQFHV  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  MXGJPHQW WR EH DSSURSULDWH RQ WKH EDVLV RI WKH mFOHDUO\ 86  VHHDOVR6WHPOHUY&LW\RI)ORUHQFH HVWDEOLVKHGl SURQJ RI WKH TXDOLILHG LPPXQLW\ WHVW  $V WKH )G WK&LU  DSSO\LQJ)DUPHUjV DERYH GLVFXVVLRQ LQGLFDWHV ZH FDQ ILQG QR FRQWUROOLQJ GHOLEHUDWH LQGLIIHUHQFH VWDQGDUG WR )RXUWHHQWK $PHQGPHQW DXWKRULW\ ZKHUH D FRXUW KDV KHOG VLPLODU FRQGXFW WR EH FODLPLQQRQLQVWLWXWLRQDOVHWWLQJ FHUWGHQLHG86 XQFRQVWLWXWLRQDOmXQGHUIDFWVQRWGLVWLQJXLVKDEOHLQDIDLUZD\  7KXVmWKHRIILFLDOPXVWERWKEHDZDUHRIIDFWVIURP IURPWKHIDFWVSUHVHQWHGLQWKHFDVHDWKDQGl6DXFLHU6 ZKLFKWKHLQIHUHQFHFRXOGEHGUDZQWKDWDVXEVWDQWLDOULVNRI &WDW,Q5XVVR)GDWZHKHOGWKDWWKH VHULRXVKDUPH[LVWVDQGKHPXVWDOVRGUDZWKHLQIHUHQFHl GHIHQGDQWSROLFHRIILFHUVZHUHHQWLWOHGWRTXDOLILHGLPPXQLW\ )DUPHU86DW+DYLQJGUDZQWKHLQIHUHQFHWKH RQ WKH SODLQWLIIjV ZDUUDQWOHVV HQWU\ FODLPV ZKHUH WKH RIILFLDO PXVW DFW RU IDLO WR DFW LQ D PDQQHU GHPRQVWUDWLQJ XQGLVSXWHG IDFWV VKRZHG WKDW WKH VXVSHFW ZDV PHQWDOO\ mUHFNOHVV RU FDOORXV LQGLIIHUHQFHl WRZDUG WKH LQGLYLGXDOjV GLVWXUEHGWKHVXVSHFWSRVVHVVHGWZRNQLYHVDUDGLRFDOOKDG ULJKWV/DQGRO5LYHUDY&UX]&RVPH)G VW GHVFULEHGWKHVXVSHFWDVVXLFLGDODQGWKHVXVSHFWKDGWXUQHG &LU  RXWWKHOLJKWVDQGJRQHVLOHQWLPPHGLDWHO\EHIRUHWKHRIILFHUVj GHFLVLRQ WR HQWHU  :H H[SODLQHG WKDW HYHQ LI WKH RIILFHUVj )URPWKHUHFRUGWKHUHLVOLWWOHGRXEWWKDW&KLHI%H\HUGUHZ DFWLRQVZHUHXQUHDVRQDEOHZHZHUHQRWDZDUHRImDVLQJOH WKHLQIHUHQFHWKDWDJJUHVVLYHWDFWLFVPLJKWSURYRNH0U/HNDQ FDVHLQGLFDWLQJWKDWDQRIILFHUjVDWWHPSWWRUHVFXHZKDWWKDW WRUHVSRQGLQDGDQJHURXVPDQQHUWRZDUGKLVZLIHDQGFKLOG RIILFHU EHOLHYHV WR EH D VXLFLGDO SHUVRQ GRHV QRW FRQVWLWXWH ,Q KLV GHSRVLWLRQ &KLHI %H\HU TXLWH IUDQNO\ H[SODLQHG WKDW H[LJHQWFLUFXPVWDQFHVl,GDW:HDUHQRWDZDUHRIDQ\ m>W@KDWSRVVLELOLW\>RIDYLROHQWUHDFWLRQ@H[LVWHGWKURXJKRXW VXFK FDVH WKDW KDV LVVXHG VLQFH 5XVVR  &HUWDLQO\ WKHQ D WKHHQWLUHFULVLVVLWXDWLRQVRZHZHUHFRQFHUQHGWKDWWKDWZDV UHDVRQDEOH RIILFHU FRXOG QRW DQWLFLSDWH WKDW D FRXUW PLJKW LQIDFWZKDWZRXOGKDSSHQls$DW %H\HU'HSDW  GHFLGHH[LJHQWFLUFXPVWDQFHVZHUHDEVHQWZKHUHWKHGDQJHU &KLHI%H\HUDOVRLQGLFDWHGWKDWKHFRQVLGHUHGWKHSRVVLELOLW\ RI VXLFLGH ZDV FRPSRXQGHG E\ DQ DSSDUHQW WKUHDW WR WKH RIDPXUGHUVXLFLGHUHDFWLRQZKHQHYDOXDWLQJWKHDGYLVDELOLW\ VXVSHFWjV IDPLO\  7KHUHIRUH VXPPDU\ MXGJPHQW IRU WKH RILQLWLDWLQJDQDVVDXOWZLWKWKHDUPRUHGYHKLFOHEXWKHKRSHG RIILFHUVRQWKHJURXQGVRITXDOLILHGLPPXQLW\LVDSSURSULDWH WKDW0U/HNDQmZRXOGWDNHKLVDJJUHVVLYHDFWLRQRXWRQWKH UHJDUGLQJWKHZDUUDQWOHVVHQWU\FODLP SROLFHls$DW %H\HU'HSDW  ([FHVVLYH)RUFH ,WVHHPVFOHDUIURPWKHUHFRUGKRZHYHUWKDW&KLHI%H\HU DOVR NQHZ WKDW IXUWKHU GHOD\ DQG LQDFWLRQ DOVR SRVHG 7KH GLVWULFW FRXUW UHMHFWHG WKH $SSHOODQWjV )RXUWK VXEVWDQWLDOULVNV7KH&DOOLVUHSRUWIRUH[DPSOHFRQFOXGHG $PHQGPHQWH[FHVVLYHIRUFHFODLPRQWKHJURXQGVWKDWWKHUH WKDW DOWKRXJK RQ EDODQFH D VWUDWHJ\ RI VWDOOLQJ IRU WLPH ZDVQRWDmVHL]XUHlRIHLWKHU0U/HNDQRUKLVIDPLO\s$DW JHQHUDOO\LVWKHEHVWWRUHGXFHULVNVWRKRVWDJHVVWDOOLQJKDVLWV  'LVW&W2SDW $VWKHFRXUWQRWHGWKH)RXUWK RZQGUDZEDFNVDQGULVNV7KHXQGLVSXWHGIDFWVVXJJHVWWKDW $PHQGPHQWSURWHFWVDJDLQVWRQO\XQUHDVRQDEOHVHL]XUHVLWLV WKHVH ULVNV DQG GUDZEDFNV IDFWRUHG LQWR &KLHI %H\HUj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jVFRQFOXVLRQWKDW0UV/HNDQDQGKHUVRQZHUH VWDQGRIIVLWXDWLRQDVORQJDVWKH\GLGQRWDFWPDOLFLRXVO\DQG QRWVHL]HG1HYHUWKHOHVVZHFRQFOXGHWKDWWKH$SSHOODQWKDV VDGLVWLFDOO\ZLWKWKHLQWHQWWRFDXVHKDUP7KHGLVWULFWFRXUW QRW GHPRQVWUDWHG D JHQXLQH LVVXH RI PDWHULDO IDFW DV WR QRWHGWKLVVDPHFRQFHUQH[SODLQLQJWKDWLWGLGmQRWEHOLHYH ZKHWKHUH[FHVVLYHIRUFHZDVXVHGDJDLQVW0U/HNDQ WKDW EHFDXVH 0U /HNDQ ZDV DUPHG DQG GDQJHURXV WKH GHIHQGDQWV FRXOG DWWHPSW WR UHVWRUH RUGHU E\ DQ\ PHDQV $)RXUWK$PHQGPHQWVHL]XUHRFFXUVZKHQDSROLFHRIILFHU ZKDWVRHYHUVRORQJDVWKH\GLGQRWLQWHQGWRKXUWWKH/HNDQVl UHVWUDLQV WKH OLEHUW\ RI D FLWL]HQ LQ VXFK D ZD\ WKDW D s$DW 'LVW&W2SDW  UHDVRQDEOH FLWL]HQ ZRXOG UHDVRQDEO\ EHOLHYH XQGHU WKH FLUFXPVWDQFHVWKDWKHRUVKHZDVQRWIUHHWROHDYH0LFKLJDQ 1HYHUWKHOHVV HYHQ XQGHU WKH PRUH H[DFWLQJ GHOLEHUDWH Y&KHVWHUQXW86  $YLRODWLRQRIWKH LQGLIIHUHQFHVWDQGDUGZHFRQFOXGHWKDWWKH$SSHOODQWKDVQRW )RXUWK$PHQGPHQWUHTXLUHVWKHmLQWHQWLRQDODFTXLVLWLRQRI VKRZQ D JHQXLQH LVVXH RI PDWHULDO IDFW DV WR ZKHWKHU WKH SK\VLFDOFRQWUROlRIDSHUVRQE\DVWDWHRIILFLDO%URZHUY FRQGXFW RI WKH SROLFH URVH WR WKH OHYHO RI WKH FRQVFLHQFH &RXQW\RI,Q\R86  $VHL]XUHGRHVQRW VKRFNLQJ XQGHU WKH SDUWLFXODU FLUFXPVWDQFHV SUHVHQWHG RFFXUPRUHRYHUXQWLOWKHVXEMHFWLVVXFFHVVIXOO\GHWDLQHGE\ 'HOLEHUDWH LQGLIIHUHQFH KDV EHHQ HTXDWHG ZLWK VXEMHFWLYH SK\VLFDOIRUFHRUDVKRZRIDXWKRULW\&DOLIRUQLDY+RGDUL UHFNOHVVQHVVDQGUHTXLUHVWKH†SODLQWLIIWRVKRZWKDWWKH '  86    KROGLQJ WKDW ER\ ZDV QRW VHL]HG VWDWHmRIILFLDONQRZVRIDQGGLVUHJDUGVDQH[FHVVLYHULVNWR ZKLOHIOHHLQJIURPSXUVXLQJSROLFHRIILFHUXQWLORIILFHUWDFNOHG >WKH YLFWLPjV@ KHDOWK RU VDIHW\l  )DUPHU Y %UHQQDQ  KLPEULQJLQJER\XQGHUSK\VLFDOFRQWURO *DODV)GDW  m&OHDUO\GXULQJWKHLQLWLDOVWDJHVRIWKHSXUVXLWZKHQWKH PLQRU SODLQWLII GHFLGHG WR IOHH UDWKHU WKDQ WR REH\ WKH GHIHQGDQWRIILFHUjVGLUHFWLYHWRVWRSWKHPLQRUSODLQWLIIZDV 0U /HNDQ DORQH DQG LW LV XQGLVSXWHG WKDW 0U /HNDQ ZDV FRQWDLQHG QRWUHVWUDLQHGl  ZLWKLQ KLV KRXVH DQG VXUURXQGHG E\ D YDVWO\ VXSHULRU SROLFH SUHVHQFH 0RUHRYHU WKH &RXUWjV RSLQLRQ LQ :KLWOH\ VXJJHVWV WKDW LWV UHDVRQLQJ PD\ 7KHGLVWULFWFRXUWFRQFOXGHGWKDW0U/HNDQZDVQRWVHL]HG EHFDXVH E\ EDUULFDGLQJ KLPVHOI LQ KLV KRPH KH QHYHU QRW DSSO\ RXWVLGH WKH LQVWLWXWLRQDO VHWWLQJ RI WKH SULVRQ 7KH :KLWOH\ &RXUW EDVHG LWV FRQFOXVLRQV LQ ODUJH SDUW RQ WKH GHIHUHQFH WUDGLWLRQDOO\ DIIRUGHG WR SULVRQ DGPLQLVWUDWRUV LQ PDLQWDLQLQJ GLVFLSOLQH DQG VHFXULW\ LG DW  VXEPLWWHGWRRIILFLDODXWKRULW\7KLVFRQFOXVLRQZDVLQHUURU  DQG ZDV FDUHIXO WR OLPLW LWV KROGLQJ n LQVRIDU DV LW GHILQHG WKH VFRSH 7KHUHFDQEHOLWWOHTXHVWLRQXQGHUWKHFLUFXPVWDQFHVWKDW0U RI )RXUWHHQWK $PHQGPHQW SURWHFWLRQV n WR SULVRQ LQPDWHV 7KH &RXUW /HNDQZDVQRWIUHHWROHDYH7KHGLVWULFWFRXUWFRQVLGHUHG0U H[SODLQHG WKDW m>E@HFDXVH WKLV FDVH LQYROYHV SULVRQ LQPDWHV UDWKHU WKDQ /HNDQjVFDVHWREHPRUHFORVHO\DQDORJRXVWRWKDWRIDIOHHLQJ SUHWULDO GHWDLQHHV RU SHUVRQV HQMR\LQJ XQUHVWULFWHG OLEHUW\ ZH LPSO\ QRWKLQJ DV WR WKH SURSHU DQVZHU    RXWVLGH WKH SULVRQ VHFXULW\ FRQWH[W E\ VXVSHFWZKRLVQRWXQGHUWKHFRQWURORIRIILFLDODXWKRULWLHV KROGLQJ DV ZH GR WKDW LQ WKHVH FLUFXPVWDQFHV WKH 'XH 3URFHVV &ODXVH :H EHOLHYH KRZHYHU WKDW 0U /HNDQjV FDVH PRUH FORVHO\ DIIRUGV UHVSRQGHQW QR JUHDWHU SURWHFWLRQ WKDQ GRHV WKH &UXHO DQG 8QXVXDO UHVHPEOHVWKHIDFWVLQ%URZHU86DW,QWKDWFDVH 3XQLVKPHQWV &ODXVHl ,G DW  WKHGHFHGHQWQHYHUYROXQWDULO\VXEPLWWHGWRRIILFLDODXWKRULW\  EXWZDVUHVWUDLQHGQRQHWKHOHVVZKHQKHFROOLGHGZLWKDSROLFH 2I FRXUVH DQ RIILFLDOjV VXEMHFWLYH DZDUHQHVV RI D ULVN PD\ EH URDGEORFNVHWXSIRUWKHSXUSRVHRIVWRSSLQJKLP7KH&RXUW SURYHG FLUFXPVWDQWLDOO\ E\ HYLGHQFH VXJJHVWLQJ WKDW mWKH GHIHQGDQW IRXQGWKDWWKLVDFWRIUHVWUDLQWFRQVWLWXWHGDVHL]XUHIRUWKH RIILFLDO EHLQJ VXHG KDG EHHQ H[SRVHG WR LQIRUPDWLRQ FRQFHUQLQJ WKH ULVN DQG WKXV µPXVW KDYH NQRZQj DERXW LWl )DUPHU  86 DW  SXUSRVHVRIWKH)RXUWK$PHQGPHQW,G6LPLODUO\LQWKLV 0RUHRYHU mWKH FRQFHSW RI FRQVWUXFWLYH NQRZOHGJH LV IDPLOLDU HQRXJK WKDW FDVHDOWKRXJK0U/HNDQZDVQHYHULQSROLFH FXVWRG\WKH WKH WHUP µGHOLEHUDWH LQGLIIHUHQFHj ZRXOG QRW RI LWV RZQ IRUFH SUHFOXGH D SROLFHVXUURXQGHGWKHKRXVHDQGSDUDGHGDQDUPRUHGYHKLFOH VFKHPH WKDW FRQFOXVLYHO\ SUHVXPHG DZDUHQHVV IURP D ULVNjV REYLRXVQHVVl  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  LQIURQWRIWKH/HNDQVjKRXVH7KHVHDFWLRQVTXDOLI\DVDQ RIILFHUVZHUHQRWH[FKDQJLQJJXQILUHZLWK/HNDQDWWKHWLPH LQWHQWLRQDODSSOLFDWLRQRISK\VLFDOIRUFHDQGVKRZRIDXWKRULW\ WKDWWKHIDWHIXOGHFLVLRQVRIWKDWGD\ZHUHPDGH PDGHZLWKWKHLQWHQWRIDFTXLULQJSK\VLFDOFRQWURO0RUHRYHU WKLVDVVHUWLRQRIIRUFHDQGDXWKRULW\VXFFHHGHGLQUHVWUDLQLQJ 2WKHUFRXUWVKDYHIRXQGWKDWDQLQWHQWWRKDUPLVUHTXLUHG 0U /HNDQjV OLEHUW\ WR OHDYH KLV KRPH  8QOLNH WKH IOHHLQJ ZKHUH WKH SROLFH ILUH XSRQ DQ HVFDSLQJ VXVSHFW DQG VXVSHFWVLQ+RGDUL'DQG*DODV0U/HNDQZDVQRWmRQWKH LQDGYHUWHQWO\LQMXUHKRVWDJHVLQWKHSURFHVV&KLOGUHVVY&LW\ ORRVHl%\ZD\RILOOXVWUDWLRQ0U/HNDQFOHDUO\ZRXOGKDYH RI$UDSDKR)G WK&LU  KROGLQJ EHHQVHL]HGIRUWKHSXUSRVHVRIWKH)RXUWK$PHQGPHQWKDG LQWHQWWRKDUPUHTXLUHGZKHUHSROLFHILUHGXSRQKLMDFNHGYDQ WKHSROLFHQDLOHGVKXWWKHGRRUVDQGZLQGRZVRIKLVKRXVH FRQWDLQLQJKRVWDJHVLQDWWHPSWWRVWRSYDQDVLWGURYHWKURXJK ZLWKKLPLQVLGH7KHDFWLRQVRIWKHSROLFHLQWKHLQVWDQWFDVH VHULHVRISROLFHURDGEORFNV /HHY:LOOLDPV)6XSSG ZHUHQROHVVHIIHFWLYHLQUHVWUDLQLQJ0U/HNDQjVPRYHPHQWV   (' 9D   LQWHQW WR KDUP DSSOLHG ZKHUH DQGWKHUHIRUHVKRXOGEHFRQVLGHUHGDVHL]XUH&I)LVKHUY DUPHGVXVSHFWVWRRNDKRVWDJHDQGZHUHDWWHPSWLQJWRHVFDSH &LW\RI0HPSKLV)G WK&LU  KROGLQJ LQWKHKRVWDJHj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jV YHUVLRQ RI WKH IDFWV VXEMHFW WR WKH )RXUWK $PHQGPHQWjV UHDVRQDEOHQHVV VXJJHVWVWKDWWKHGDQJHUZDVQRWLPPHGLDWHDVORQJDV0U UHTXLUHPHQW,QUH&LW\RI3KLODGHOSKLD/LWLJ)G /HNDQZDVQRWSURYRNHG  UG&LU  6FLULFDsFRQFXUULQJDQGGLVVHQWLQJ  KROGLQJ WKDWXVHRILQFHQGLDU\GHYLFHVDJDLQVWKRXVHZDVVHL]XUHDVLW  ZDVXVHRImIRUFHZLWKWKHDLPRIJDLQLQJHQWU\LQWRWKHKRXVH :H QRWH WKDW :KLWOH\ Y $OEHUV  86    ZKLFK ZDV RU IRUFLQJ WKH RFFXSDQWV RXWl  FHUW GHQLHG  86  GLVFXVVHG IDYRUDEO\ LQ /HZLV FRXOG EH LQWHUSUHWHG WR VXJJHVW WKDW WKH PRUH  *LQWHUY6WDOOFXS)G WK&LU SHUPLVVLYH mLQWHQW WR KDUPl WHVW DSSOLHV HYHQ ZKHQ WKHUH LV D JHQXLQH KROGLQJ WKDW VHWWLQJ EXLOGLQJ RQ ILUH WR mVPRNH RXWl LVVXH RI PDWHULDO IDFW DV WR WKH LPPHGLDF\ RI WKH GDQJHU SRVHG E\ D EDUULFDGHG DQG DUPHG LQGLYLGXDO 7KH :KLWOH\ &RXUW KHOG WKDW mLQWHQW WR EDUULFDGHG VXVSHFW ZDV VXEMHFW WR )RXUWK $PHQGPHQW KDUPl ZDV WKH DSSURSULDWH VWDQGDUG IRU DVVHVVLQJ (LJKWK DQG )RXUWHHQWK UHDVRQDEOHQHVV WHVW WR GHWHUPLQH ZKHWKHU GHVWUXFWLRQ RI $PHQGPHQW YLRODWLRQV LQ WKH FRQWH[W RI D SULVRQ ULRW ,G DW  7KH SURSHUW\ ZDV ZDUUDQWHG   %HFDXVH ZH FRQFOXGH WKDW 0U SODLQWLII LQ :KLWOH\ DQ LQPDWH ZDV LQMXUHG ZKHQ JXDUGV ILUHG VKRWJXQV /HNDQZDVVHL]HGIRUWKHSXUSRVHVRIWKH)RXUWK$PHQGPHQW LQWR DQ LQPDWHFRQWUROOHG FHOO EORFN LQ DQ RSHUDWLRQ WR UHVFXH D JXDUG ZHWKHUHIRUHDQDO\]HWKHSROLFHjVDFWLRQVWRZDUGKLPVROHO\ EHLQJ KHOG KRVWDJH 7KH &RXUW FRQFOXGHG WKDW WKH LQWHQW WR KDUP VWDQGDUG ZDV DSSURSULDWH HYHQ WKRXJK mWKH HYLGHQFH FRXOG EH WDNHQ WR VKRZ WKDW XQGHU WKH REMHFWLYH UHDVRQDEOHQHVV WHVW RI WKH )RXUWK WKH JHQHUDO GLVWXUEDQFH KDG TXLHWHG GRZQl ,G DW  $PHQGPHQW6HH*UDKDPY&RQQRU86 1RQHWKHOHVV ZH WKLQN LW ZRXOG EH LQDSSURSULDWH WR H[WHQG WKH :KLWOH\   KROGLQJWKDWZKHUHDQH[FHVVLYHIRUFHFODLPDULVHVLQ KROGLQJ WR WKH LQVWDQW FDVH ,QLWLDOO\ :KLWOH\ LV IDFWXDOO\ GLVWLQJXLVKDEOH WKH FRQWH[W RI DQ DUUHVW RU LQYHVWLJDWRU\ VWRS LW VKRXOG EH 7KH :KLWOH\ &RXUW HPSKDVL]HG WKDW WKH XQGLVSXWHG IDFWV VKRZHG WKDW WKH DQDO\]HGVROHO\XQGHU)RXUWK$PHQGPHQWDQGQRW)RXUWHHQWK VLWXDWLRQ DOWKRXJK LW KDG FDOPHG VRPHZKDW mUHPDLQHG GDQJHURXV DQG YRODWLOHl ,G DW  7KLV ZDV EDVHG XSRQ IDFWV LQGLFDWLQJ WKDW LQ $PHQGPHQW'XH3URFHVV&ODXVH  DGGLWLRQ WR WKH GDQJHU WR WKH KRVWDJH JXDUG mVHYHUDO    LQPDWHV ZHUH DUPHG     QXPHURXV LQPDWHV UHPDLQHG RXWVLGH WKHLU FHOOV DQG WKH :HFRQFOXGHWKDWWKHGLVWULFWFRXUWZDVFRUUHFWKRZHYHULQ FHOOEORFN UHPDLQHG LQ WKH FRQWURO RI WKH LQPDWHVl ,G 7KXV DFFRUGLQJ WR ILQGLQJWKDWWKHSROLFHGLGQRWVHL]H0UV/HNDQRUs7/HNDQ WKH &RXUW WKH SROLFH ZHUH FRQIURQWHG ZLWK DQ XQFRQWDLQHG DQG RXWRI FRQWURO SULVRQ ULRW ,Q WKH LQVWDQW FDVH E\ FRQWUDVW WKH WKUHDW FDPH IURP  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  WKLVZDVDVLWXDWLRQZKHUHDFWXDOGHOLEHUDWLRQZDVSUDFWLFDO 7KHUH ZDV QR UHDVRQ IRU HLWKHU RI WKHP WR EHOLHYH WKDW WKH 7KH SROLFH ZDLWHG ILYH KRXUV WR LQLWLDWH WKH ILUVW mWDFWLFDO SROLFHZHUHSUHYHQWLQJWKHPIURPOHDYLQJWKHKRXVH,QIDFW VROXWLRQlZKLFKVWURQJO\VXJJHVWVWKDWVSOLWVHFRQGGHFLVLRQ LWZDVWKHFOHDUREMHFWLYHRIWKHSROLFHWRUHPRYHWKHPIURP PDNLQJZDVQRWUHTXLUHG0DQ\PRUHKRXUVSDVVHGEHIRUHWKH WKHKRXVHDQGUHPRYHWKHPIURPWKHFRQWURORI0U/HNDQ GHFLVLRQZDVPDGHWRGHSOR\WKHDUPRUHGYHKLFOH,QGHHGLQ 7KHLU PRYHPHQW ZDV UHVWUDLQHG E\ 0U /HNDQ RU LQ 0UV KLV GHSRVLWLRQ &KLHI %H\HU LQGLFDWHG WKDW WKH GHFLVLRQ WR /HNDQjVFDVHKHURZQSK\VLFDOFRQGLWLRQ QRWE\WKHSROLFH LQLWLDWH D WDFWLFDO DVVDXOW ZDV PDGH DIWHU FRQVXOWLQJ WZR 7KH IDFW WKDW WKH SROLFH H[HUFLVHG FRQWURO RYHU WKH PHQWDO KHDOWK SURIHVVLRQDOV DQG UHTXHVWLQJ LQSXW IURP WKH HQYLURQPHQWLQWKH/HNDQVjKRXVHGRHVQRWGHPRQVWUDWHWKDW RIILFHUVRQWKHVFHQH%H\HUDOVRLQGLFDWHGWKDWKHGLVFXVVHG 0UV /HNDQ DQG KHU VRQ ZHUH VHL]HG  7KH GLVWLQJXLVKLQJ WKHSURVDQGFRQVRIXVLQJWHDUJDV&OHDUO\WKLVWHVWLPRQ\ IHDWXUHRIDVHL]XUHLVWKHUHVWUDLQWRIWKHVXEMHFWjVOLEHUW\n GHPRQVWUDWHVQRWRQO\WKDWGHOLEHUDWLRQZDVSUDFWLFDOEXWWKDW VSHFLILFDOO\KLVRUKHUIUHHGRPWRZDONDZD\&RQWURORYHU VRPHHIIRUWDWGHOLEHUDWLRQZDVLQIDFWPDGH7KLVFRQFOXVLRQ RQHjV HQYLURQPHQW GRHV QRW HVWDEOLVK D VHL]XUH XQOHVV WKDW LVVXSSRUWHGE\&DOOLVjVUHSRUWZKLFKQRWHGWKDWWKHUHZDVQR FRQWURO VRPHKRZ UHVWULFWV WKH VXEMHFWjV SK\VLFDO OLEHUW\ QHHGIRULPPHGLDWHDFWLRQDQGFRQFOXGHGWKDWm>R@QHRIWKH 7KHUH DUH QR IDFWV DOOHJHG WKDW ZRXOG VXJJHVW WKLV ZDV WKH VWURQJHVW SRLQWV RQ WKH VLGH RI WKH DXWKRULWLHV ZDV µWLPHjl FDVHIRU0UV/HNDQRUKHUVRQ s$DW &DOOLV5HSDW  (YHQ WKRXJK ZH FRQFOXGH WKDW WKH GLVWULFW FRXUW HUUHG LQ 7KH WLPH IRU GHOLEHUDWLRQ DYDLODEOH WR &KLHI %H\HU LQ ILQGLQJ WKDW 0U /HNDQ ZDV QRW VHL]HG WKH $SSHOODQW KDV GHFLGLQJKRZWRUHVSRQGWR0U/HNDQjVDFWLRQVGLVWLQJXLVKHV QRQHWKHOHVVIDLOHGWRVKRZWKDWWKHRIILFHUVjXVHRIIRUFHZDV WKLV FDVH IURP WKRVH FDVHV LQ ZKLFK DFWXDO PDOLFH DQG DQ XQUHDVRQDEOH7KHGHWHUPLQDWLRQRIZKHWKHUIRUFHXVHGWR LQWHQWWRKDUPZDVUHTXLUHG,Q/HZLVIRUH[DPSOHWKHHQWLUH HIIHFWDVHL]XUHZDVXQUHDVRQDEOHmUHTXLUHVFDUHIXODWWHQWLRQ FRXUVHRIHYHQWVODVWHGDPHUHVHYHQW\ILYHVHFRQGV86 DW:KHQWKHRIILFHUVREVHUYHGWKHYLFWLPjVPRWRUF\FOH DSSURDFKLQJ DW KLJK VSHHG WKH\ ZHUH IRUFHG WR PDNH DQ  LQVWDQWDQHRXVGHFLVLRQWRJLYHFKDVH,GDW/LNHZLVHLQ ,Q KLV GLVVHQW sXGJH +XOO UHOLHV XSRQ 6WHPOHU Y &LW\ RI )ORUHQFH &OD\EURRN Y %LUFKZHOO  )G  WK &LU   ZH  )G   WK &LU   FHUW GHQLHG  86    LQ UHDFKLQJ WKH FRQFOXVLRQ WKDW 0UV /HNDQ DQG KHU VRQ ZHUH VHL]HG E\ WKH KHOGWKDWDE\VWDQGHULQMXUHGGXULQJDSROLFHVKRRWRXWPXVW SROLFH :H WKLQN WKLV FDVH LV LQDSSRVLWH 6WHPOHU ZDV D VXEVWDQWLYH GXH VKRZWKDWWKHSROLFHDFWHGmµPDOLFLRXVO\DQGVDGLVWLFDOO\IRU SURFHVV FDVH QRW D )RXUWK $PHQGPHQW H[FHVVLYH IRUFH FDVH ,Q 6WHPOHU WKHYHU\SXUSRVHRIFDXVLQJKDUPjlLQRUGHUWRPDLQWDLQDGXH ZH KHOG WKDW WKH SROLFH E\ SK\VLFDOO\ UHPRYLQJ WKH GHFHGHQW &RQQL SURFHVVFODLP,GDW TXRWLQJ/HZLV86DW  %ODFN IURP RQH YHKLFOH DQG SODFLQJ KHU LQ WKH YHKLFOH RSHUDWHG E\ KHU :HH[SODLQHGWKDWWKLVVWDQGDUGZDVDSSURSULDWHEHFDXVHWKH LQWR[LFDWHG DQG DEXVLYH ER\IULHQG WRRN DIILUPDWLYH DFWLRQ WR UHVWUDLQ WKH GHFHGHQWjV OLEHUW\ DQG WKHUHIRUH RZHG KHU D GXW\ QRW WR DFW LQ D PDQQHU SROLFHmKDGQRRSSRUWXQLW\WRSRQGHURUGHEDWHWKHLUUHDFWLRQ WKDW ZDV GHOLEHUDWHO\ LQGLIIHUHQW WR KHU VDIHW\ SXUVXDQW WR WKH )RXUWHHQWK WR WKH GDQJHURXV DFWLRQV RI WKH DUPHG PDQl ZKHQ KH $PHQGPHQWjV VXEVWDQWLYH GXH SURFHVV SURWHFWLRQV ,G 7KH GHFHGHQWjV DSSURDFKHGWKHPPHQDFLQJO\ZLWKDZHDSRQDQGWKHQRSHQHG FODLPV ZHUH QRW DQDO\]HG XQGHU WKH )RXUWK $PHQGPHQWj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jV YHKLFOH DJDLQVW KHU ZLOO ,G 1R VXFK DFW RI GLUHFW SK\VLFDO UHVWUDLQW ZDV HYHU WDNHQ LQ UHODWLRQ WR 0UV /HNDQ RU KHU VRQ  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  WR WKH IDFWV DQG FLUFXPVWDQFHV RI HDFK SDUWLFXODU FDVH PDNH XQKXUULHG MXGJPHQWV XSRQ WKH FKDQFH IRU UHSHDWHG LQFOXGLQJ WKH VHYHULW\ RI WKH FULPH DW LVVXH ZKHWKHU WKH UHIOHFWLRQODUJHO\XQFRPSOLFDWHGE\WKHSXOOVRIFRPSHWLQJ VXVSHFWSRVHVDQLPPHGLDWHWKUHDWWRWKHVDIHW\RIWKHRIILFHUV REOLJDWLRQVl  ,G DW   7KH &RXUW IXUWKHU H[SODLQHG RU RWKHUV DQG ZKHWKHU KH LV DFWLYHO\ UHVLVWLQJ DUUHVW RU KRZHYHU WKDW mZKHQ XQIRUVHHQ FLUFXPVWDQFHV GHPDQG DQ DWWHPSWLQJWRHYDGHDUUHVWE\IOLJKWl*UDKDP86DW RIILFHUjVLQVWDQWMXGJPHQWHYHQSUHFLSLWDWHUHFNOHVVQHVVIDLOV 7KHWHVWLVREMHFWLYHLWDVNVZKHWKHUDUHDVRQDEOHRIILFHU WRLQFKFORVHHQRXJKWRKDUPIXOSXUSRVHWRVSDUNWKHVKRFN ZRXOGFRQFOXGHWKDWWKHOHYHORIIRUFHXVHGZDVDSSURSULDWH WKDWLPSOLFDWHVµWKHODUJHFRQFHUQVRIWKHJRYHUQRUVDQGWKH 6HHLGDW JRYHUQHGjl,G TXRWLQJ'DQLHOV86DW ,QVXFK VLWXDWLRQV ZKLFK LQFOXGH KLJK VSHHG YHKLFOH FKDVHV D 8QGHUWKLVVWDQGDUGZHKROGWKDWVXPPDU\MXGJPHQWIRU )RXUWHHQWK$PHQGPHQWYLRODWLRQRFFXUVRQO\ZKHQWKHSROLFH WKHGHIHQGDQWVZDVDSSURSULDWH7KHSROLFHXVHGGHDGO\IRUFH DFWZLWKPDOLFHDQGDQmLQWHQWWRKDUPl,GDW RQO\GXULQJWKHWDFWLFDODVVDXOWRQWKH/HNDQVjKRPH$WWKLV SRLQWKRZHYHULWLVXQGLVSXWHGWKDW0U/HNDQZDVILULQJRQ $SSO\LQJWKLVIUDPHZRUNZHDJUHHZLWKWKHGLVWULFWFRXUW WKHRIILFHUVDQGKHWKHUHIRUHSRVHGDQLPPHGLDWHWKUHDWWRWKH WKDW WKLV FDVH mIDOOV ZLWKLQ WKH µPLGGOHUDQJHj EHWZHHQ RIILFHUV  $OWKRXJK WKH IDFWV YLHZHG PRVW IDYRUDEO\ WR WKH FXVWRGLDO VHWWLQJV DQG KLJKVSHHG FKDVHVl DQG OLNHZLVH SODLQWLIIVUHYHDOWKDW0U/HNDQZDVQRWDQLPPHGLDWHWKUHDW FRQFOXGHWKDWRQEDODQFHmWKHPRUHDSSURSULDWHVWDQGDUGRI ZKHQWKHRIILFHUVZHUHQRWDWWHPSWLQJDIRUFLEOHHQWU\QHLWKHU UHYLHZLVµGHOLEHUDWHLQGLIIHUHQFHjls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jV KRPH EXW QRW KLV SHUVRQ ZHUH REMHFWLYHO\ UHDVRQDEOH DV  DSSOLHGWR0U/HNDQ$WOHDVWRQHFRXUWKDVIRXQGIDUJUHDWHU :H QRWH WKDW DOWKRXJK WKH LVVXH KDV QHYHU EHHQ GHFLGHG FDVHV IURP GHVWUXFWLRQ RI SURSHUW\ WR EH UHDVRQDEOH DW WKH VXPPDU\ WKLV FLUFXLW GHFLGHG EHIRUH /HZLV KDYH mH[SUHVVHG GRXEWl DV WR ZKHWKHU WKH GHOLEHUDWH LQGLIIHUHQFH VWDQGDUG VKRXOG DSSO\ LQ QRQFXVWRGLDO VHWWLQJV MXGJPHQW VWDJH LQ WKH FRQWH[W RI DQ DUPHG DQG EDUULFDGHG 6WHPOHU Y &LW\ RI )ORUHQFH  )G    WK &LU   FHUW LQGLYLGXDO*LQWHU)GDW KROGLQJWKDWSODLQWLIIV GHQLHG  8 6    6XFK GRXEW ZH EHOLHYH KDV EHHQ IDLOHGWRFUHDWHDMXU\TXHVWLRQDVWRZKHWKHUEXUQLQJGRZQ UHVROYHG E\ WKH &RXUWjV RSLQLRQ LQ /HZLV ZKLFK PDGH FOHDU WKDW WKH NH\ KRXVH ZKHUH KHDYLO\ DUPHG IXJLWLYH ZDV EDUULFDGHG ZDV YDULDEOH LV ZKHWKHU DFWXDO GHOLEHUDWLRQ LV SUDFWLFDO QRW ZKHWKHU WKH XQUHDVRQDEOH XVH RI IRUFH   ,Q OLJKW RI 0U /HNDQjV FODLPDQW ZDV LQ VWDWH FXVWRG\ $V WKH &RXUW H[SODLQHG GHOLEHUDWH LQGLIIHUHQFH DSSOLHV LQ FXVWRGLDO VHWWLQJV EHFDXVH WKHVH VHWWLQJV SURYLGH ZLOOLQJQHVVWRXVHGHDGO\IRUFHDJDLQVWWKHSROLFHLQUHVLVWLQJ WKH RSSRUWXQLW\ IRU UHIOHFWLRQ DQG XQKXUULHG MXGJPHQWV /HZLV  86 DUUHVW WKH XVH RI QRQGHDGO\ IRUFH VXFK DV WHDU JDV DQG DW  &XVWRGLDO VHWWLQJV KRZHYHU DUH QRW WKH RQO\ VLWXDWLRQV LQ ZKLFK SV\FKRORJLFDOWDFWLFVZKLOHSHUKDSVLOOFRQVLGHUHGZDVQRW RIILFLDOV PD\ KDYH D UHDVRQDEOH RSSRUWXQLW\ WR GHOLEHUDWH m/LNH SULVRQ H[FHVVLYHXQGHUDQ\YHUVLRQRIWKHIDFWVEHIRUHXV,QGHHG RIILFLDOV ZKR DUH FKDUJHG ZLWK RYHUVHHLQJ DQ LQPDWHjV ZHOIDUH 6WDWH WKH$SSHOODQWKDVSUHVHQWHGQRHYLGHQFHWRLQGLFDWHWKDW0U RIILFLDOV ZKR FUHDWH RU HQKDQFH GDQJHU WR FLWL]HQV PD\ DOVR EH LQ D /HNDQZDVSK\VLFDOO\KDUPHGLQDQ\ZD\E\WKHIRUFHH[HUWHG SRVLWLRQ ZKHUH µDFWXDO GHOLEHUDWLRQ LV SUDFWLFDOjl %XWHUD  )G DW  TXRWLQJ /HZLV  86 DW  DSSO\LQJ GHOLEHUDWH LQGLIIHUHQFH E\WKHSROLFH VWDQGDUG LQ FDVH LQ ZKLFK SULYDWH FLWL]HQ ZDV LQMXUHG ZKLOH DFWLQJ DV XQGHUFRYHU RSHUDWLYH LQ SROLFH LQYHVWLJDWLRQ ZKHUH IDFWV VKRZHG WKDW mRIILFHUV KDG WKH RSSRUWXQLW\ WR SODQ WKH XQGHUFRYHU RSHUDWLRQ ZLWK FDUHl   (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO  WKDW)RXUWHHQWK$PHQGPHQWOLDELOLW\ZLOODWWDFKWRmFRQGXFW (YHQLIDFRQVWLWXWLRQDOLQMXU\KDGRFFXUUHGWKHODZLVQRW LQWHQGHG WR LQMXUH LQ VRPH ZD\ XQMXVWLILDEOH E\ DQ\ VXIILFLHQWO\FOHDUO\HVWDEOLVKHGRQWKLVTXHVWLRQWRRYHUFRPH JRYHUQPHQWDOLQWHUHVWl/HZLV86DW HPSKDVLV TXDOLILHGLPPXQLW\6HH5XVVR)GDW,QUH DGGHG   m:KHWKHU WKH SRLQW RI WKH FRQVFLHQFH VKRFNLQJ LV &LW\RI3KLODGHOSKLD/LWLJ)GDW JUDQWLQJTXDOLILHG UHDFKHGZKHQLQMXULHVDUHSURGXFHGZLWKFXOSDELOLW\IDOOLQJ LPPXQLW\WRSROLFHZKHUHILUHXVHGWRVPRNHRXWEDUULFDGHG ZLWKLQWKHPLGGOHUDQJHIROORZLQJIURPVRPHWKLQJPRUHWKDQ JURXSDIWHUJXQEDWWOHEHFDXVHLWFRXOGQRWFRQFOXGHWKDWmLQ QHJOLJHQFH EXW OHVV WKDQ LQWHQWLRQDO FRQGXFW VXFK DV WKH OLJKW RI SUHH[LVWLQJ ODZ WKH XQODZIXOQHVV RI HLWKHU UHFNOHVVQHVVRUµJURVVQHJOLJHQFHjLVDPDWWHUIRUFORVHUFDOOVl GURSSLQJWKHH[SORVLYHRUOHWWLQJWKHILUHEXUQVKRXOGKDYH ,G TXRWDWLRQDQGFLWDWLRQRPLWWHG  EHHQDSSDUHQWl TXRWDWLRQRPLWWHG ,Q5XVVR)GDW  ZH KHOG WKDW WKH GHIHQGDQW SROLFH RIILFHUV ZHUH :KHWKHUFRQGXFWIDOOLQJZLWKLQWKLVmPLGGOHUDQJHlUHDFKHV HQWLWOHGWRTXDOLILHGLPPXQLW\DVWRWKHFODLPWKDWWKH\XVHG WKHOHYHORIFRQVFLHQFHVKRFNLQJGHSHQGVXSRQWKHIDFWVDQG XQUHDVRQDEOHIRUFHLQILULQJPXOWLSOHWLPHVZLWKDQRQOHWKDO FLUFXPVWDQFHVRIWKHLQGLYLGXDOFDVH$VWKH6XSUHPH&RXUW 7DVHUJXQXSRQDPHQWDOO\ GLVWXUEHGVXVSHFWZLHOGLQJWZR UHFHQWO\H[SODLQHGFRQGXFWmWKDWVKRFNVLQRQHHQYLURQPHQW NQLYHV:HQRWHGWKDWmDOWKRXJKWKHSODLQWLIIVjDOOHJDWLRQV PD\QRWEHVRSDWHQWO\HJUHJLRXVLQDQRWKHUDQGRXUFRQFHUQ PD\UDLVHDJHQXLQHLVVXHRIPDWHULDOIDFWDVWRZKHWKHUWKH ZLWKSUHVHUYLQJWKHFRQVWLWXWLRQDOSURSRUWLRQVRIVXEVWDQWLYH XVHRIWKH7DVHUZDVUHDVRQDEOHlZHFRXOGQRWFRQFOXGHWKDW GXH SURFHVV GHPDQGV DQ H[DFW DQDO\VLV RI FLUFXPVWDQFHV WKH GHIHQGDQWjV mXVH RI QRQOHWKDO IRUFH WR VXEGXH D EHIRUH DQ\ DEXVH RI SRZHU LV FRQGHPQHG DV FRQVFLHQFH SRWHQWLDOO\ KRPLFLGDO LQGLYLGXDO WUDQVJUHVVHG FOHDUO\ VKRFNLQJl,GDW)RUH[DPSOHLQWKHFRQWH[WRISUHWULDO HVWDEOLVKHG ODZl  ,G  ,Q UHDFKLQJ WKLV FRQFOXVLRQ ZH GHWHQWLRQWKHIDXOWUHTXLUHPHQWIRUDGXHSURFHVVYLRODWLRQ HPSKDVL]HG WKDW WKH GHIHQGDQW mGHSOR\HG WKH 7DVHU LQ DQ PD\ EH VDWLVILHG E\ VKRZLQJ WKDW VWDWH RIILFLDOV ZHUH HIIRUW WR REYLDWH WKH QHHG IRU OHWKDO IRUFHl  ,G DW  GHOLEHUDWHO\ LQGLIIHUHQW WR WKH EDVLF PHGLFDO QHHGV RI 6LPLODUO\ KHUHWKHGHIHQGDQWVGLGQRWHPSOR\OHWKDOIRUFH GHWDLQHHV,GVHHDOVR+HIOLQY6WHZDUW&RXQW\)G H[FHSWGXULQJWKRVHRFFDVLRQVZKHQ0U/HNDQILUHGGLUHFWO\  WK&LU FHUWGHQLHG86  %\ XSRQWKHP:HDUHDZDUHRIQRFRQWUROOLQJSUHFHGHQWVLQFH FRQWUDVWLQ/HZLV86DWWKH6XSUHPH&RXUWKHOG 5XVVR KROGLQJ WKDW WKH XVH RI QRQOHWKDO IRUFH DJDLQVW DQ WKDW HYHQ mGHOLEHUDWH LQGLIIHUHQFHl LV LQVXIILFLHQW WR DUPHGDQGYRODWLOHVXVSHFWFRQVWLWXWHVH[FHVVLYHIRUFH:H GHPRQVWUDWHD)RXUWHHQWK$PHQGPHQWYLRODWLRQRQWKHEDVLV WKHUHIRUHFRQFOXGHWKDWWKHGHIHQGDQWVDUHHQWLWOHGWRTXDOLILHG RISROLFHFRQGXFWGXULQJDKLJKVSHHGYHKLFOHFKDVH LPPXQLW\RQWKH$SSHOODQWjVH[FHVVLYHIRUFHFODLP m>7@KH FULWLFDO TXHVWLRQ LQ GHWHUPLQLQJ WKH DSSURSULDWH 6XEVWDQWLYH'XH3URFHVV&ODLP VWDQGDUGRIFXOSDELOLW\LVZKHWKHUWKHFLUFXPVWDQFHVDOORZHG WKH VWDWH DFWRUV WLPH WR IXOO\ FRQVLGHU WKH SRWHQWLDO :H DOVR FRQFOXGH WKDW WKH GLVWULFW FRXUW FRUUHFWO\ FRQVHTXHQFHV RI WKHLU FRQGXFWl  0RUHODQG Y /DV 9HJDV GHWHUPLQHGWKDWWKHFRQGXFWRIWKHSROLFHGXULQJWKHWZRGD\ 0HWUR 3ROLFH 'HSjW  )G   WK &LU  VWDQGRIIGLGQRWYLRODWHWKHVXEVWDQWLYHGXHSURFHVVULJKWVRI UHYLHZLQJ FLUFXLWVj WUHDWPHQW RI /HZLV GHFLVLRQ   $V WKH %HYHUO\ /HNDQ RU KHU VRQ  $V WKH 6XSUHPH &RXUW KDV /HZLV&RXUWH[SODLQHGWKHGHOLEHUDWHLQGLIIHUHQFHVWDQGDUG H[SODLQHGmµ>W@KHWRXFKVWRQHRIGXHSURFHVVLVSURWHFWLRQRI mLV VHQVLEO\ HPSOR\HG RQO\ ZKHQ DFWXDO GHOLEHUDWLRQ LV WKH LQGLYLGXDO DJDLQVW DUELWUDU\ DFWLRQ RI JRYHUQPHQWj SUDFWLFDOl,GDW7KH&RXUWQRWHGIRUH[DPSOHWKDW ZKHWKHUWKHIDXOWOLHVLQDGHQLDORIIXQGDPHQWDOSURFHGXUDO mOLDELOLW\IRUGHOLEHUDWHLQGLIIHUHQFHWRLQPDWHZHOIDUHUHVWV IDLUQHVVRULQWKHH[HUFLVHRISRZHUZLWKRXWDQ\UHDVRQDEOH XSRQWKHOX[XU\HQMR\HGE\SULVRQRIILFLDOVRIKDYLQJWLPHWR MXVWLILFDWLRQl&RXQW\RI6DFUDPHQWRY/HZLV86  (ZROVNLY&LW\RI%UXQVZLFNHWDO 1R 1R (ZROVNLY&LW\RI%UXQVZLFNHWDO     TXRWLQJ:ROIIY0F'RQQHOO86 RI&ROXPELD)G '&&LU  m$OO    FLWDWLRQVRPLWWHG 7KH$SSHOODQWjVFODLP FLUFXLW FRXUWV RI DSSHDOV    KDYH E\ QRZ UHOLHG RQ WKLV LVRQHRIVXEVWDQWLYHQRWSURFHGXUDOGXHSURFHVV7KDWLVWKH SDVVDJH LQ 'H6KDQH\ WR DFNQRZOHGJH WKDW WKHUH PD\ EH $SSHOODQWDUJXHVWKDW0UV/HNDQDQGKHUVRQZHUHGHSULYHG SRVVLEOHFRQVWLWXWLRQDOOLDELOLW\ZKHUHWKHVWDWHFUHDWHVD RI OLIH DQG OLEHUW\ DV D UHVXOW RI WKH DUELWUDU\ H[HUFLVH RI GDQJHURXV VLWXDWLRQ RU UHQGHUV FLWL]HQV PRUH YXOQHUDEOH WR JRYHUQPHQW SRZHU n QDPHO\ WKH DFWLRQV RI WKH SROLFH LQ GDQJHUl TXRWDWLRQRPLWWHG %RZHUVY 'H9LWR)G XQQHFHVVDULO\HVFDODWLQJWKHFRQIURQWDWLRQZLWK0U/HNDQ  WK&LU  m,IWKHVWDWHSXWVDPDQLQDSRVLWLRQ RIGDQJHUIURPSULYDWHSHUVRQVDQGWKHQIDLOVWRSURWHFWKLP 7KH'XH3URFHVV&ODXVHRIWKH)RXUWHHQWK$PHQGPHQWLV LWZLOOQRWEHKHDUGWRVD\WKDWLWVUROHZDVPHUHO\SDVVLYHLW mSKUDVHGDVDOLPLWDWLRQRQWKH6WDWHjVSRZHUWRDFWQRWDVD LVDVPXFKDQDFWLYHWRUWIHDVRUDVLILWKDGWKURZQKLPLQWRD JXDUDQWHHRIFHUWDLQPLQLPDOOHYHOVRIVDIHW\DQGVHFXULW\l VQDNH SLWl   7KH $SSHOODQWjV FODLP LV EDVHG XSRQ VXFK D 'H6KDQH\Y:LQQHEDJR&RXQW\'HSjWRI6RFLDO6HUYV mVWDWHFUHDWHGGDQJHUlWKHRU\7KDWLVWKH$SSHOODQWFRQWHQGV 86  7KHSXUSRVHRIWKH'XH3URFHVV&ODXVH WKDW WKH FRQGXFW RI WKH %UXQVZLFN SROLFH LQ HVFDODWLQJ WKH mZDVWRSURWHFWWKHSHRSOHIURPWKH6WDWHQRWWRHQVXUHWKDW FRQIURQWDWLRQ ZLWK 0U /HNDQ VXEVWDQWLDOO\ LQFUHDVHG WKH WKH 6WDWH SURWHFWHG WKHP IURP HDFK RWKHUl  ,G DW   ,Q GDQJHUWKDWKHZRXOGDFWYLROHQWO\WRZDUGKLVZLIHDQGVRQ JHQHUDOWKHUHIRUHWKH'XH3URFHVV&ODXVHGRHVQRWLPSRVH OLDELOLW\RQWKH6WDWHIRULQMXULHVLQIOLFWHGE\SULYDWHDFWVRI ,QRUGHUWRHVWDEOLVKDFRQVWLWXWLRQDOYLRODWLRQKRZHYHULW YLROHQFH7KHUHDUHKRZHYHUH[FHSWLRQVWRWKLVJHQHUDOUXOH LV QRW HQRXJK WR VKRZ D FDXVDO FRQQHFWLRQ EHWZHHQ VWDWH )LUVWVWDWHRIILFLDOVPD\EHVXEMHFWWRFRQVWLWXWLRQDOOLDELOLW\ DFWLRQ DQG DQ DFW RI SULYDWH YLROHQFH  m>7@KH GXH SURFHVV LI WKH\ IDLO WR SURYLGH SURWHFWLRQ IRU LQGLYLGXDOV LQ VWDWH JXDUDQWHH GRHV QRW HQWDLO D ERG\ RI FRQVWLWXWLRQDO ODZ FXVWRG\m7KHUDWLRQDOHIRUWKLVSULQFLSOHLVVLPSOHHQRXJK LPSRVLQJ OLDELOLW\ ZKHQHYHU VRPHRQH FORDNHG ZLWK VWDWH ZKHQ WKH 6WDWH E\ WKH DIILUPDWLYH H[HUFLVH RI LWV SRZHU VR DXWKRULW\ FDXVHV KDUPl  /HZLV  86 DW   7KH UHVWUDLQVDQLQGLYLGXDOjVOLEHUW\WKDWLWUHQGHUVKLPXQDEOHWR $SSHOODQW PXVW GHPRQVWUDWH WKDW WKH VWDWH DFWHG ZLWK WKH FDUHIRUKLPVHOIDQGDWWKHVDPHWLPHIDLOVWRSURYLGHIRUKLV UHTXLVLWH FXOSDELOLW\ WR HVWDEOLVK D VXEVWDQWLYH GXH SURFHVV EDVLFKXPDQQHHGVnHJIRRGFORWKLQJVKHOWHUPHGLFDO YLRODWLRQXQGHUWKH)RXUWHHQWK$PHQGPHQW$VWKH6XSUHPH FDUHDQGUHDVRQDEOHVDIHW\nLWWUDQVJUHVVHVWKHVXEVWDQWLYH &RXUW KDV H[SODLQHG WKLV UHTXLUHV WKDW WKH †  SODLQWLII OLPLWVRQVWDWHDFWLRQVHWE\WKH(LJKWK$PHQGPHQWDQGWKH VKRZWKDWWKHFKDOOHQJHGDFWLRQZDVVRmHJUHJLRXVlWKDWLWFDQ 'XH3URFHVV&ODXVHl,GDW EHVDLGWREHmDUELWUDU\LQWKHFRQVWLWXWLRQDOVHQVHl,GDW TXRWDWLRQRPLWWHG 7KH6XSUHPH&RXUWLQHODERUDWLQJXSRQ (YHQLQQRQFXVWRGLDOVHWWLQJVKRZHYHUVWDWHRIILFLDOVPD\ WKLV VWDQGDUG KDV UHSHDWHGO\ LQVWUXFWHG WKDW WKH )RXUWHHQWK YLRODWHWKH'XH3URFHVV&ODXVHZKHQWKHLUDIILUPDWLYHDFWLRQV $PHQGPHQWSURWHFWVRQO\DJDLQVWDEXVHRIH[HFXWLYHSRZHU GLUHFWO\ LQFUHDVH WKH YXOQHUDELOLW\ RI FLWL]HQV WR GDQJHU RU ZKLFKmVKRFNVWKHFRQVFLHQFHl,G RWKHUZLVHSODFHFLWL]HQVLQKDUPjVZD\6HH'H6KDQH\ 86DW m:KLOHWKH6WDWHPD\KDYHEHHQDZDUHRIWKH 7R EH VXUH WKH mVKRFNV WKH FRQVFLHQFHl VWDQGDUG LV mQR GDQJHUVWKDWsRVKXDIDFHGLQWKHIUHHZRUOGLWSOD\HGQRSDUW FDOLEUDWHG \DUG VWLFNl  ,G DW   $W D PLQLPXP WKH LQ WKHLU FUHDWLRQ QRU GLG LW GR DQ\WKLQJ WR UHQGHU KLP DQ\ VWDQGDUG UHTXLUHV D VKRZLQJ EH\RQG PHUH QHJOLJHQFH PRUH YXOQHUDEOHWRWKHPl *D]HWWHY&LW\RI3RQWLDF 'DQLHOVY:LOOLDPV86  m)DUIURPDQ )G WK&LU  m>$@GXW\WRSURWHFWFDQDULVH DEXVHRISRZHUODFNRIGXHFDUHVXJJHVWVQRPRUHWKDQD LQDQRQFXVWRGLDOVHWWLQJLIWKHVWDWHGRHVDQ\WKLQJWRUHQGHU IDLOXUHWRPHDVXUHXSWRWKHFRQGXFWRIDUHDVRQDEOHSHUVRQl DQLQGLYLGXDOPRUHYXOQHUDEOHWRGDQJHUl %XWHUDY'LVWULFW ,G$WWKHRWKHUHQGRIWKHVSHFWUXPLWLVJHQHUDOO\DJUHHG

Document Info

Docket Number: 00-3066

Filed Date: 4/18/2002

Precedential Status: Precedential

Modified Date: 9/22/2015