you i'd like to just get a few points there are a number of arguments in this case the first one has to do with the honest intangible right of on the services and one of the primary cases that the government relies upon as to why it shouldn't apply in this case and why there shouldn't be error if united states versus or which is cited in the briefs that case is clearly distinguishable to the situation because of the court will look at that case and the jury instructions that were specifically given in piece that was in fact some limitation on what intangible services of the right to own a services actually meant in that situation and the jury had to make those findings and if the court can't counsel helped me on something that or  confused me with the groups on both sides i don't understand well two things about this issue one is why the government even needed the honest services part of the indictment is  t fraud for money and they could have just charged this money and the other thing i don't understand is why either side thinks that the government needs a fiduciary relationship and accessory before the fact or an aider and abettor in causing the brokers to lie to the customers in order to get the customers to invest in the stock it seems like that's fine for depriving the customers  the honest services of the brokers even if the brokers do not have a fiduciary duty what am i missing here first of all i don't know why the government alleged that actually it doesn't make any sense to me but the fact is that they did it and once they did the if you look at the cases especially sewer it doesn't say that it has to be a fiduciary relationship in the technical legal sense of the term but there has to be  some duty between the broker and the customer well all you need is a duty not to lie though i mean suppose i go into one of the shops on the way home and i say i want to buy a hasselblad camera really expensive good camera and that the man at the shop hands me a camera he says here's a hasselblad that will be i don't know what they cost now three thousand dollars and i buy it he don't have a fiduciary duty to me he has just the most limited arm's length commercial responsibility but he still committed fraud and if you're the person who was misbranding cameras and making fake castle blabs look like real hassle blabs then you'd be an aider and a bettor and that he has a duty to make but it doesn't have to be anything special just a duty not so hamas something well except that i think that the courts have said in these situations and in the cases that we've talked in this particular situation the problem is that there there there wasn't any clarification or any direction to this jury both on that issue excuse me counsel on you get a minute to think about what the final response because i just idea why don't we just do the best we can so we don't interrupt argument why don't you get it fixed before tomorrow thanks that's ok and really that's much of another question on that point position today on that is that at the very least mr tanner was entitled to a right to a hearing i don't see what the problem was as i read the questions and it looks like every response the juror gave told him about it and the f b i agent said that he had just gotten out in the nick of time so he was involved in some way now we don't know to what degree but  him he was just getting out in the nick of time in the area at least one of the businessmen involved it gone to prison due to his role in the deal now what they through the point whatever conclusions in mr brooks his mind about the association involvement of the cayman islands and he made that it was involved in a project and somebody came to him with th agencies that regulate the security industry and i don't see where in order to tell the truth the jury would be called upon to talk about this time when he was approached  well i don't know reinsurance it would seem to me that that would involve in some way government regulation and that if you're going to be involved in a reinsurance project that that would be a reasonable response because right now i'm quite saying ok in the introduction to voir dire the judge explains to the jury what this case involves and it involves an offshore corporation involving the cayman regulate such businesses as the securities and exchange commission the national association of securities dealers or the stock exchanges i don't see how even if he if he had been like you know the tourist agent or think that if the spirit of order for dire is for people to be honest and tell what they now want with your experiences are you can't inquire with someone about whether or not they have any preconceived ideas unless they tell you about what  court where the lawyer gets to have a conversation with the juror because that way you sort of snip what is not being said and you can poke around and find out you don't get it in federal court usually just let me just and i'm looking at this question the question was have any of you held or used offshore tax shelters foreign banks or securities accounts or any of you hold views your prejudices regarding persons who try to avoid taxes or tax laws which would interfere with your ability to be fair and impartial in this case that's the question now thinking the question for us is did this jury foreman lie when he didn't raise this hand and say yes and i answer that and i'm thinking boy if i was asked that i understand it to mean do i have any offshore accounts and do i have any feelings about tax avoidance that might make me less than impartial if somebody does have offshore accounts and it would never occur to me to talk about the experience this guy had with somebody trying to palm off some reinsurance deal and i respect to figure out that i should call him a liar for not raising a stand on it well mr cain and that that mr brook was involved some degree to some extent in the reinsurance situation unless there's another question on that point the court's ruling on that is in th of record one twelve one thirteen and the court found that there was only a tangential relationship with another situation involving offshore schemes to his relationship with the company was tenuous at most we basically ha liar in order to grant relief on this point going yeah and i think he should have disclosed that it was reasonably called for because of the combination of the fact that what he was being for dired about had to do with the cayman islands and he himself had been involved with activity in the cayman islands that he thought was illegal and fraudulent and he himself withdrew from you know sometimes it's nice when you get to do your own  kind of vague and clumsy in your questions so that there are broader these questions are real precise and they don't ask you ever have anything to do with anything about the cayman islands where you might have orally but i think that's being overly technical because this isn't the real issue here to try and find out we have a fair and impartial jury no the real issue is to find out whether this juror lied well if i doubt whether you have an impartial jury when you're doing the board here we only get to reverse if this jury foreman why well what and all i'm saying is that there ought to be hearing if there are unanswered questions here i concede there and answer questions but questions that should be answered the inquiry should be made that's all we're what the question that he sent to the to the judge and to counsel during the course of the trial when he said once we finalize if you're liberations can we write a written opinion and that was also discussed in the context of this with the court and counsel during the course of the count and the court should have inquired of him at that time exactly what he was talking about because once he said once we finalized that's a reasonable conclusion that is he's already started to finalized and he's already thinks ahead or not well that's true but when you want to ask i mean what did you mean by that have you guys had the other jurors in yourself been talking about the facts of this case that  question that opens further inquiry which serve what do you mean by that what can you tell us has there been any discussion about this that's the least i think that should be done in that kind of a situation what does court and the downward departure particularly the downward departure how do we i think we have to review that they know both young fanfan don't upset the whole apple cart right now and i'm wondering just what we're supposed to what i think is on the downward departure issue what isn't part of the record i don't think i'm not sure because it was sealed so i don't know whether it's come up here or not but the memorandum that was filed by mr sun in regard to the departure in regard to sentencing and in that memorandum he set forth all of these various factors and when judge garson went through this he said there were a number of factors that were listed not only discussed by mr stan at the time of immediately prior to the sentencing but in that memorandum that was before the court and part of the record and there were a lot of different things there was age the fact that he had previously been a law abiding citizen the effect of these convictions on his family not that he was religious or but that he had been excommunicated from his church there was discussion about the co defendants and their fraudulent activities prior to this and of course you can't exactly compare because in fact  oh wasn't found guilty and didn't plead guilty to money laundering so it doesn't exactly fall there but then he did not use that as a specific basis for this this these are all things none of which that paragraph would say that there's a combination of factors involving the agent of mr cantor who was what fifty two at the time that this occurred he had he had been a lawyer for twenty some years  particular case to take it outside of the heartland and and i think that in fact judge plus and good that he just didn't articulate once you three four five six  you want to or should look i just reserve a couple minutes i'm sort of big on time about two minutes ago i got a note from the clerk that you had two minutes left so i think he just finished your time but will probably give you couple minutes number of vital thing please court name is robert lyons i'm appearing on behalf of the united states mr peel judges i also asked the prosecutor why we added on the services to the indictment because it raised all sorts of issues that i attorney would prefer not to have to brief and without getting into our particular conversation i have to tell you i still don't know so i don't have an answer for you but i have to tell you i asked that question myself because  cases i did want to point out that the ny circuit has cases i think answer this question we don't really have to go to second circuit law the question being well as to the honest  this court held that thirteen forty six overruled mcnally's holding that the mail in wire fraud statute did not reach on a service so basically i'm did what the consumes private contracts even though it's not a case by case right yes and you know we don't have a private contract dispute here i mean you know you don't you could argue the fringes of the honest search you know how far the honest services theory should be expanded but in this case we have telemarketing fraud with furhman of misrepresentations and material omissions of brokers who told their victims call them up instead we're not about the cayman islands everybody knows the cayman islands is a tax haven and you know i want to point out that this is your tax haven particularly i thought it was just kind of a general dirty money even well it's just that because of one least for me i don't i don't personally find the knowledge of the cayman islands to be an incident to be per se evidence this wasn't information that defense counsel independently town dirty laundry on a juror who's like defense counsel says can i talk to you and i soon would submit that if it's your had adverse feelings regarding to the friend that he would say no i don't want to talk to you him and the defense attorneys would have gone to the court the next day i mean this is an argument that they're adding to the pile you know and they brought it to the court's attention five months later and you know i would point to tires actually to record buying three seven forty eight in support of that statement with regard to their being hearing i would point to this court's decision and tracy versus paul matter three forty one f for ten thirty seven two thousand and three and that we did a twenty page a on that but the court held that now you don't have to have a hearing the court can consider certain factors the content of the allegations the seriousness of the u s misconduct or bias and the credibility of the source and you know i would submit that the judge considered all this and that and heller part of this case we have the whole for the current plan plan that's correct judge on the upward adjustment for organizer leader on sentencing disparity with no better with that in the way the guidelines coming out you see that a guy who was a much worse criminal than this defendant was involved in the same team is only getting five to serve and that just because of odd bounces in the guidelines this defendant is getting a multiple of that why isn't it reasonable for the judge to cut it down i know we have cases it's a disparity by itself is not a you know with court sat that were that if fact they had similar content but there were different charging decisions and defendants were in fact being convicted of different offenses and this court held in bach that you know they're not going to second guess the  then because of the odd balances that occur in a complex game in this case because the sentencing disparity so the judge irons that out well i would submit that i mean i think the premise of your question is that that that  was more culpable than tenor in every respect and i would just agree with that tanner was convicted of multiple tax crimes and the money laundering offenses were basically handled by guys to money laundering which is what drove the sentencing guidelines in this case if you remember on the green tanner is persuading or telling these are the boiler room guys like taylor for example i think his  launder money and he is helping them open overseas accounts prior to terror involvement there's no indication that these guys the compiler and guys laundered money abroad in the caymans  has all these prior boiler room transactions but tanner up to any with introducing these guys in this transaction and other transactions the money laundering portion of the crimes at issue in this case and surely it was the money laundering thought you were feeling around for an answer for that with with your adversary i want to know what your answer is if the courts have a valid concern about honest services being brought so broadly interpreted that it you know not every contractor suit you don't want to get i don't want to get somebody indicted for  the form of back corruption because they asked somebody to go out for beer when they're getting paid by the hour i mean it's more you know it does it does the action why in tort as opposed to contract i mean that would be the first cut off i would look at you know are we looking tortious passion as opposed to a run of the mill contract action and you know there are hard questions to be asked perhaps in the in some cases as to how far that should go but you know telemarketing fraud is purely within the tort you know the question is like in the in repeat if i may go to the second circuit and ponce decision you know they had a discussion of this issue and they eventually held that you know if you have you know a council made this argument that the accounts were non discretionary and so there is less of an obligation by the broker as opposed to a discretionary account where the broker get to buy and sell for the person's account on his own initiative as opposed to at the direction of the account holder but what the second circuit said was even in a not discretionary count when appropriate is selling you know calls up his client and says i want you to buy this stock there is an obligation not to make material misrepresentations or material missions and the court held that failing to tell your client that you're making a seventy percent or kickback is a breach so like i said you know there could be i don't know if i want to get into the i don't think i'm going to be able to tell you how far the honest services doctrines should go i can tell you that this case is squarely in the middle of what every court of appeals has ever held daughter certainly knew that calling up victims over the phone and using our the mails and wires in support of their false least promoting a stock they knew to be worthless in failing to tell their or their cypriots of the phone calls of victims that they were getting the seventy percent kickback a person who does that knows has has has a notice that his actions constitute yron mail fraud slightly different argument well he added in his reply brief age family circumstances loss of career loss of law license and he was lost his church membership him as well but that doesn't mean that the government can't punish him and i don't mean to be glib in that regard but i mean the government gets to exact its punishment rather the church kicks him out you know separate that's true but that's really not the question for me the question is can the judge take into account add the fact that the person has already suffered more as punishment from the floor says than the government when he decides how much he should be punished by the government and also on the disparity issue it's not just that there's disparity it's that the judge is saying that in this somewhat anomalous circumstance the guidelines are largely by the money laundering guidelines and as i stated earlier you know if you're well it's not just that as i read the thing the judge is thinking the more sophisticated criminal is getting the sophisticated criminal to do the stuff that invites the more severe punishment kind of like if three guys are going into some kind of go deal and they persuade the young fellow that that know any better you carry the gun if money wonder if this fifty five if the driving force behind the sentence was not money laundering say it had been no money laundering i might yield that a little bit but i don't because  subsumed in the money laundering count so what we what were our pills based on our grouping appeals based on is the district judge just grouping the money laundering in tax and the judge even got that wrong i mean he grouped under deep well under do you got to aggregate the loss and he didn't do that so now the defendants come in and say well we're not going to justify the judge's grouping based on t v let's look a see well that doesn't apply and again this gets into whether six thirty four is retroactive in the fact that proc either old law money laundering had a base defense level twenty three with some incremental increases depending on the arm now longer post two thousand two thousand one way or my view laundering is based on the amount of the fraud and then there's some smaller amounts based on high money laundering amounts so grouping under c is correct because that would otherwise be double counting and we have that and this arguments on three and the butler case goes against the government on this but we submit is wrong and creates an inner circle conflict and we would submit an interest or conflict with an unpublished cision so we're hoping that it gets rectified but i record and cited to you in the briefs i didn't even realize himself that there was a boiler room operation until he went to new york and went to the empire state building and found it to exist and if mr taylor didn't know who was more you know that's why these people came to him it was their idea how to do it he he didn't know but the point is he did not know how that was done and there's no indication that he did ever been involved in that kind that was ever involved in any of that kind of activity before this was clearly and this has to do i suppose with the enhancement parole and the offense as well because really that he didn't have cancer didn't have control of five people boiler room when they're trying a palm off drunk when you've got a stock like this made for a day or whatever it was called that you know it's junk from the get go it's not worth two cents and if you're causing it to be sold for ten or twelve dollars a share that you know that people are being tricked out of their money calling it a boiler room it's just really journalists and prosecutors talk or selling that  junk and i agree with the semantics of that just like in the briefs they talk about kickbacks if you look at the record in the colony commission if you want to if well if you don't want to call them dirty you call it a kickback if you think it's thirty and that's like well but that's what the because he doesn't have to see the boiler room an operation in the empire state building to know that worthless stock is being palmed off on gullible victims or significant amounts of money well you know and i understand what you have just said but i think it makes assumptions that the record doesn't support that mr cantor actually knew or was informed about as to how the stock was going to be sold handbags to say look i don't know what the street vendors are telling their customers i have nothing to do with whatever pitch they make to their customers because it can't be true i have to know that situation because here in fact there was a reverse merger there were in fact why see if the trucking that was a business that in fact did reverse merge into naked and is still operating today so the basic assumption that there was no value here it's not correct and in fact there was a shell corporation that was created by mr kennett before we knew about he was in the business of selling shell corporations to the businesses that were in operation that wanted to do reverse mergers it's a legitimate business and in fact wasn't it really was a legitimate shell corporation there's nothing illegal in and of itself of of selling shell corporations they do it all the time so the companies can do reverse mergers into it it's a legitimate business that i made it was merely want of about twenty transactions were evans and tanner created shell corporation for the purpose of selling shells for use in a reverse merger and what that means is that you have a private company that would like to go public but would not doesn't want to go through the time and expense of doing the paperwork itself to go public they will purchase a shell corporation that is publicly traded and through the merger or become itself the private corporation would be publicly quoted the best way to cash out is to sell their own business into a larger business or into a shell that will take them public the end result of the situation you just described is that the people  current owners of the private corporation don't end up with all cash and not the stock of the publicly quoted here and in the end the transactions that we haven't made in the twenty that they did previously the private owners  ninety percent of the publicly quoted company and ten percent is dispersed among the individuals like