## In the



# U n ited S ta tes Co urt o f Ap p ea ls

F o rth eS e v e n th C ir cu it
N o. 08

- 3731 U NIT ED S TATE S OF A MERI CA, P la intif f-A pp ellee, v . K YL E K IMOTO, D e f e ndan t

-Appe l l ant
.
A pp eal from the United S t ates Di strictC our t fo r the S outhernDi stricto f Illino is. No . 3:07- cr-30089- MJ R- 1

—Mi ch ael J . Reagan, Judge .
A RGUED J UN E 2, 2009

— D ECIDED D ECE MBE R 2, 2009

Befo re P OSNER, R IPPLE a nd K ANN E , C ircu it Judges . R IPPLE, Cir cu i tJudg e . K yl e K i m oto w as charg ed w i th one count o fco nspir acy, i n vi ola ti on o f18 U
. S. C. § 3 71, on e c ou n t ofm ai lfra ud , i n vi ol ati on o f18 U
. S. C. § 1 341, and tw elv e counts o fwir e fra ud , i n vi ol ati on o f 18 U
. S. C. § 1 343. A ftera ten- day tr ial, t h e j ury convi cted M r. Kim oto o n al lco unts. M r. Kim oto appeal ed. Fo r th e reason s s e t forth i n th is opinion, w e affirm M r. Kim oto ’ s co nvi cti on a nd al so a ffi rm al las pects of2 N o. 08

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A pay- as - you- go debi tc ar d ope ra t es l i ke a pre - pai d t el eph one 1 org i ftc a r d. Th e c a r d i t s e l fh a s n o va l ue un t i l the u s e r l oa ds fund s on i t
. Un l i ke a g i ftc a r d, h owe ve r , o nc e va l ue h a s be en loaded on the card, i t i s acce pted w herever that part ic ular c a r d c ompa ny ’ s c a r d ( VI S A o r Mas t e r Ca r d) i s a c c e pt e d. P o r c e l l i al s o h a d ma r k e t e d th e p r o g r a m u n d e r th e n a me 2 Firs t Am eri can Leis ure. hi s se nt en ce e xc eptf o rthe di st r i ct cour t’ s enha nc ement fo rthe numbe ro fv i ct i m s. W i thr es pec t to thi s o ne as pec t o fM r . Ki m o to ’ s se nt en cing, we r emand to the dist ri ct c ourtf orfurtherpro ceedi ngs.

I B AC KGR OUND K yle K im ot o w as p re sid en t o f A ss a i l, In c . (“A ss ail” ), a tel em ar ket i ng fi rm bas ed i n St
. Geor ge, U tah. In 200 1, A ssa i lbeg an m ar ket i ng a fi nanci alpacka ge devel oped by an o th er t el emar k et i ngc o m pan y, Ro ck wel lS o l ut i o ns ( “Rockwel l ”)
. The packa ge i ncl ud ed a pay

- as- you-g o deb i t ca r d, a l o ngwi tho th erpr o m o ti o na ldi sc ou nt s, a nd

1 w as cal l ed “Fi rst Fi nanci alS ol uti ons. ” Afte r A ssa i lended its ass oci ati on with Rockwel l, i t be gan m ar ket i ng an equi val ent pr oduct devel oped by the Bay A re a Busi ness Council( “BA BC ”) , wh i ch w as own ed and opera ted by Pe te r Por cel l i
. A ssa i lal so m ar ket ed a s i m i l arpro du ct 2 o n i t s o wn,under the nam es Prem i erOne, A dvantage Cap i taland Capita lFi rs t. I n m ak i ng co l d ca l l s to co ns um er s th r o ug hou t the U ni ted S tat es, A ss ailused “l ead l i sts ” with nam es ofN o. 08

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consum er s who ei therhad appli ed f orcr edi t a nd bee n turned dow n or had a l ess - than- perfect cre dith ist ory. The prog ra m was desi gn ed to m ake i nd i vi du al s be l i eve th at th e c all w as in re sp on se to a re c en t c re d it a p p lic at ion and that thei r appli cati ons w er e no w being pro ce ss ed o rr ec o ns i der ed. A te l emark et erwoul d c al lthe pros pecti ve buyerand sta te: “Our r eco rds ind i cate that w i thi n the past 1 2 m onths, yo u fi l ed an appli cati on f or a c r e di tc a r d a nd y o u a r e n o w e l i g ib l e t o r ecei ve yourVi sa ora M as te rCar d.” Gov’ t Ex. 2a
. The te l em arketer w ou ld p roceed to ask abou t the i nd ivi d ua l’ s househol d and m onthl y incom e. The cust om erthen w ou ld be p u t o n h old for “ c o m p u te r au th or iza tio n,” whi chc ons i st ed m er ely o fthe t el emar k et erpl ac i ng the ind i vi du alo n hol d; no a uthor i zati on a ctual l y was occur ring. Tr. V at18
. W hen the tel em arke te r returned to the l i ne, he woul d stat e: “M r. /M rs . [ Cu sto m erN am e] base d on yo ur info rm atio n y ou ar e guarant eed to r ecei ve a M as te rC ar d t h at d oe s n otreq u ire a se c u rit y d ep os it w i th an i ni ti alpay as you go l i m i t of $200 0. ” Gov’ t Ex. 2a
. The c onsum erthen w oul d be info rm ed that he would be ch ar g ed a o ne - ti m e pr o ce ss i ngfee of $1 59
. 95
. The c o nsu me rwa s r e mi n d e d th a tn o th i n g“ l o o k s b e t t e ro n y o ur Eq uif ax cr edi t r epor t than a M ast er Card. ” Id. I fthe c o nsum er a g r ee d t o pur ch as e th e pac k ag e, s he w as tran sfe rr ed to a “ver i fi er . ” The pro cess i ng fee w as a o ne- ti m e debi t o fthe consum er ’ s ba nk ac count, bas ed upo n o r ala utho r i za ti o n, a nd the r efo r e, a r ec o r di ng of th e4 N o. 08

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N o eq u iv alen t reco rd ing w as m ad e of the sales ca ll. 3 In so m e instan ces, consu m ers rece iv ed no card at all. 4 D es pite the se repr es entat ions , none ofthe com panies 5 involved in dev el op ing or m arketi ng the package reporte d cust om er ac ti vity t o Equ if ax. ver i fi cati on ca l lwas m ade. T h e co nsum erhear d an 3 autom ate d discl osu re m enti oni ng the pay- as- you- go M as te rC ar d an d ad vis in g t h at th er e w ou ld be n o c re d it on th e card un til a paym en t w as m ad e. I f con su m ers ask ed questi ons ofthe ver i fi er, the ver i fi erat tem pted to g i ve r es po ns es tha t co nfi r m ed th e i m pr es si o n tha t th e consum erwould be re cei vi ng a cre ditcar d. Tr. V at29

- 31. A ssa i l ’ s pro gr am s sp aw ned thousands o fcusto m er c om p lain ts a b ou t t h e c ar d s re c eiv ed

. For ca rd s s old in 4 co n n e c t i o n wi th B AB C , th e r e we r e a s ma n y as o ne hundr ed th ou sand cus to m erc o m pl aint s dur i nga s ev en mo n th p e r i o d

. F o rc a r d s s o l d b y As s ai l thr o u g h i t s o wn prog ra m s, custo m erse rv i ce was o utsour ced to S peci al ty O u ts ou rc in g So lu tio n s (“ SO S” ) in W a c o, T ex as . A ss ail provi ded “r ebutta l ” s cri pts f orS OS r epres enta tiv es to us e i n a ddr es singc us to m erc o m pl ai nt s. O ne o fthe meth

ods th at S O S used i n ass uagi ng cust om er s was to i nfo rm them that kee ping the car d woul d im prove t h e i r c re d it. A t it s h eig h t, SO S h ad ap p ro x im at ely 5 15 0 custom erse rv i ce r epres entat i ves fi el ding cal l s for A ssai l ’ s pr o g r ams; b etwee n e i g hty a nd nine type r ce nt oftho se cal l s were com pla i nts. W e be g i n wi tha pr ef at o r y no te
. M r . Ki m o to ’ s co ntenti ons on thi s a p p ealf ocus on three as pects ofthe pro-N o. 08

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c ee d in gs : th e s u fficie n c y of t h e e v i d e n c e t o s u p p or t h is convi cti ons; the re sponsibi l i ti es of the Gover nm ent w ith r e s p e c tt o t he t i me l y d i s c l o s u r e o fe x c u l p a t o r y a n d i mpea ch i nge vi den ce ; a nd the f ai r ne ss o fthe s en te nc i ng proce du re . W i th re spect to each, w e shal l sta te th e fa cts per tine ntt o the i ss ue a nd the n di sc us s o ura ss es sment of th e m er its of M r. K im ot o’s su b m iss ion on ap p ea l.

II SU FFI CI ENCY OF TH E E VIDENCE M r. K im ot o m ain ta in s t h at th e r e w as ins u fficie n t e vidence to co nvi ct hi m o n any of t h e counts o fthe i nd i ctm ent. H e co nten d s th at the Gove rnm ent f ai l ed to est abl i sh hi s intent to defr aud and that , w i th r espectto the c onspi ra cy count, the Gover nm ent f ai l ed to s how a n a g r e e me n tb e t we e n h e a n d P o r c e l l i
. We fi r s ts u mm ar i ze th e ev i den ce pr es en te d by th e par ti es to the dist ri ct cour t and then exam i ne M r. K i m oto’s a rgum ents i n l i ght o fthi s e vi dence.

A. B a c kg r o und M r. K im ot o’s te lem ar ke tin g a c tiv itie s re su lte d in a cr i m i nali nd i ctm ent b ei ng r etur ned against hi m o n J une 20, 20 07, i n the So uthern Dist ric t o fI l l i noi s. Count 1 ofthe i nd i ctm ent c harg ed M r. Kim oto w ith co nspir acy to com m i t m ai lfra ud , wir e fra ud and m oneyl aund er i ng. Count tw o charg ed M r. Kim oto with m ail f ra ud bas ed u p on th e m ailin g of a “b en efit s p ac ka ge ” t o a vic tim in th e d istri ct. Cou nt s three throu gh eight all eged w ire6 N o. 08

- 3731 fra ud bas ed upon the t el em ar ke ting cal l s t o l oca lvi ctim s. Fi nal l y, co unts ni ne thr ough fourt een charg ed M r. Kim oto wit h w i re fra ud r el ate d to the debi t t ra nsfer fr o m the c o ns um ers’ s ba nka cc o unt s to pa y m en t proce sso rs f orthe proce ssing fee.

1. M r . Ki m o to ’ s tr i alc o m m en ce d i n l at e M ar ch2 00 8. The Gover nm ent’ s theor y o fthe case wa s th at M r. Kim oto defr au ded hundr eds o ftho us an ds o fpe o ple by u sing dec e pt i v e s c r i pt s i n the ma r k e t i ngo fh i s fi na nc i a lp r o du c ts
. See sup ra p p. 3-4
. G ove rnm ent witnesse s t est i fi ed that both the l anguage em plo yed and the str ucture ofthe sal es pit ch w er e desi gned to m ake the consum er s be l i eve that th e y we r e p u r c h a s i n ga c r e d i tc a r d

. F o r e x a mpl e , S h a wn H atfiel d , w ho w orked f or Rock w elland help ed de vel o p the deb i t- ca r d pr o g r am m ar k et ed byAss ai l, t es ti fi ed th atthe inten t of th e sales script w as to m ake consu m ers “ p erc eiv e” th at “t h ey w er e b ein g p itc h ed a M as te r C ar d cr ed it car d w i th a cre dit l i m i t. ” Tr. I I at 181- 82. H atfi el d test i fi ed th a t he l a t e rw o r k e d w i th Mr
. K i mo t o o n o th e rp r o g r a ms d evelop ed by A ssail an d that A s s a il us ed “very sim il ar” scr i pts f oral lo fi ts prog ra m s; thes e were desi gn ed to “m isle ad [] th e c u st om er [s]” int o b elie vin g t h ey w ou ld “r ecei ve a cr edi t ca rd. ” Id. a t 183. H e a l so confi rm ed that, w ith r es p ec t to t h es e p ro gr am s, M r. K im ot o w as res p on sibl e forthe “[ f ] ro nt end, ” m eani n g “sal es, m ar ket i ng, tr ai ni ng. ” Id. a t 1 84
. S i m i l ar l y, Po r ce l l it es ti fi ed th atthe sal es scr i pt f orthe product m ar ket ed i n conj un c ti onN o. 08

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w ith B A B C w as d es ign ed to “ lea v[e ] th e u n m ist ak ab le i m pr es si o n in the c us to m er ’ s m i nd [ th at ] the y a re g o i ng t o g e ta c r e di tc a r d. ” T r . I I I at 2 5
. He fur the rt e s t i fi e d: “Tha t was the way [ M r. Kim oto ] to l d m e i t had to be sol d and I went al ong w i th i t. ” Id. The Go v e r nme ntp r o ffe r e d a ddi t i o na le v i de nc e that Assa i l, a nd s pec i fi ca l l y, M r . Ki m o to, kne w tha t th e sc rip ts w er e d ec ep tiv e be c au se th ey d ev elo p ed “re b u tt al” scr i pts f orSO S to use in fi el ding custo m erco m pla i nts. SeeG o v ’ tE x . 4 0 & sup ra p . 4. Th e fo u r sc rip te d r e b u t ta ls w e r e de s i g ne d t o r e - s e l lthe p r o du c tt o the u ns a t i s fi ed c u st om er . C u st om er s w er e t old th at “h av i n g g oo d cr ed it i s v ery i m port ant t oday and w e want y ou to be abl e t o ben efi t from this pa ck a ge.” Gov’t E x. 40. Cu stom ers w er e r em i nd ed that they w er e g ett i ng “a n unsecure d mas t e rc a r d, wh i c h we r e po r tt o Equi f a x, tha th e l ps re bui l d yourcr edi t in a s h or t per i od ofti m e. ” Id. Custo m er s, who wer e st i l lunc o nv i nc ed o fthe wor tho fthe pr o duct, w ere ask ed “wha t i s i t ab o uti m pr o vingy o ur cre dit

. . . thatdoes n’ti nter estyo u?” Id. The “F i nalEffor t” i ncl ud ed i nfo rm i ng the custo m erthat [t]h e re as on w h y w e c alle d you in t h e firstp lac e is because y ou r c redit i sn’ t a s g oo d as i t co uld be

. W i th A dvantage Capit al s [ sic] not onl y a re yo u go i ng to have a m ast ercar d i n case o fem er genci es, but al so y o u a r e g o i ngt o b e ab l e to r eb ui l d y o ur c r edi t i n a sh or t p er iod of tim e. Id. Jay L an kfo rd , pr in c ip al of S O S, te s t i fied th at A ss ail w oul d do “te st cal l s” “to m ake sure you [ w e] re usi ng al lo f the r ebutta l s a nd m ake sur e y ou were n ot g iving up to o eas y o n the sal e, to tr y to sa ve the s al e. ” Tr
. I V at 57.8 N o. 08

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M r . U l l m a n a c k n o w l e d g e d , h o w e v e r , th a tth e p a r t i e s’s 6 (co n tin u ed ...) L an kford furth er stated that A ssail w ou ld “d em an d [] ” th at, i f a cus to m ers er vi ce a g en t f ai l ed to us e al lo fthe re b u tt als , th at ag en t b e t ak en off th e p ro gr am . Id. F i na l l y, the Go v e r nme ntp r o du c e d e v i de nc e that M r . Ki m o to kne w thatthe r epr es en ta ti o ns made i n the re bu tt al s cri pts al so w er e f al se. Roge r H oward, co - own er of A p ex M er c h an t Se rv ice s (“ A p ex ”), w h i c h init ially su p p lied d eb it c ar d s t o A ss ail, te st ified th at h e t old M r. K im ot o th at th e c ar d su p p lied by A p ex w as “d efin itiv ely n ot a cre d it car d , th at th er e w as n o c re d i t w or th iness” and that “th er e weren’ t a ny cr edi t a genci es that w oul d repor t o n i t. ” Tr
. VIat14 1- 42. M r. Kim oto defended his acti ons on the gr ound that he was e ng ag ed i n the l eg i ti m at e bus i ne ss o fs el l i ng de b i tc a r ds , tha tthe s c r i pt s the mse l v es w er e n o tde c e pti ve, and that he di d his bes t t o en su re thatem plo yee s who cr o ss ed th e l i ne

— w ho a ffi rm ati vel y r epresen ted th at th e con su m er w as gettin g a c r e d it card

— w er e r em ove d. H e pos i ted that, as a m ar ket er, he was e nti tl ed to r ely o n the r epr es en ta ti ons o ftho se c r ea tingthe pr o d uct, b uttha t he ha d b ee n dupe d b y uns cr upul o us cri m i nal s, her e Po rce l l iand H oward, i nto bel iev ing that th e p ro d u c ts h e w as se llin g h ad cr ed it w or th in es s. Sp ec ifica l l y, he pr o ffer ed th e te st i m o ny o fJ effUl l m an, who had intro du ced M r. K i m oto to H oward; U l l m an testi fi ed th at H o w a rd h ad rep re se n te d th at A p ex co u ld su p p ly a debi t ca rd and thatthe use o fthe c ar d c ou l d be re p or te d to cr ed it a ge n c ies
. SeeTr. VI Iat16 8- 71. 6N o. 08

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(
. . . c on t i nu e d) 6 eventu al w ri tt en agreem ent did not i ncorporate a requir em en t th a t A p ex re p o rt to E q u ifa x. S ee Tr. V II at 180- 81. Par agr aph A s t at ed: “Ki m ot o de vel ope d a s al es m odelf or the 7 sal e ofa M ast erCard Stored V alue Deb itCard as a c reditcar d a nd t a r ge t e d c on s umer s wi th ba d or no c r e di t, w ho had (co n tin u ed ...) M r . Ki m o to ’ s tr i all as te d f o rt enda y s, a fte rwhi chthe j ury convi cted hi m o n al lco unts o fthe i nd i ctm ent.

2. In a p os t-t ria l m ot ion for a c q u itt al a n d a n ew tria l, M r . Ki m o to c o nt en ded th atthe e vi den ce was i nsuffi ci ent t o susta i n hi s co nvi cti on. S peci fi cal l y, M r. Kim oto cl ai m ed that the Gove rnm en t had f ai l ed to es tabl i sh that a co nspir acy exi ste d. The basi s forhi s cl ai m was (1) t h atse ve ra l sc r i p t s en te re d int o e vid en c e s p ec ifica lly sta ted t h at t h e pay- as- yo u-g o car d w as not a l i ne o f cred it and ( 2) th a t the re w as testim ony that he h ad “zero tol e r a nc e ” f o rmi s r e pr e s e nt a t i o ns . R
. 5 8 a t3
. Mr
. Ki m oto al so a r gue d tha t “[ t] he r e was no t es ti m o ny fr o m a ny w i tness wh i ch w oul d show [ he] knew that the s cri pts m i ght b e m i sl eadi ng, o r that custo m er s fel t m i sl ed. ” Id. at4
. F i na l l y, M r . Ki m o to c o nt en ded th atthe Go ve r nm en t d id n o t s a t isfy its bu rd en of p ro vin g h is p ar tic ipati on in any ofthe ove rtact s alleged i n the i nd i ctm ent. H e c laim ed th at th is fa ilu re of p ro o f w as ev id en c ed in the j ury’ s “ contr adic tory ver dict ” with re spect to paragr ap h s A an d B of C ou n t 1 of th e in d ict m en t. Id. at4. 710 N o. 08

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(
. . . c on t i nu e d) 7 a p p lie d fo r an d h a d b ee n tu rn ed d o w n fo r a c r e d i t c a rd .” Paragraph B st ated: “K im oto put together an i nter nati o n al netwo rk of‘ affil iat es ,’ cal l cent ers w hich m ade un sol ic it ed t el eph one c al l s t o c ons um er s , i nc l udi ng c ons um er s i n the Southern D ist ri ctofIl li nois , uti li zing the m arketing p lan and s ale s sc ri pts dev el oped by K im oto. ” R.53 at2. I n its ruling de ny ing t h e m o tion, th e d istri ct cou rt r ejected thes e con ten tions. Th e cou rt noted that Clifford Du nn, A ssa i l ’ s v i ce pr es i dent and m anage r ofi ts St
. Geo r g e, Uta h o ffi ce ; Tul l y Her d , a n Ass ai la cc o untmanage r; and Po rce l l i al l tes ti fi ed that M r. K i m ot o i ntended to mar k etthe de bi t ca r d a s a credit c ar d a nd tha t he k ne w the s cr i pts wer e m i sl ea di ng . Turni ngto the i ss ue of M r. K im oto’s pa rtici p atio n in th e overt acts , the cou rt n o t e d th a tth e j u r y f o u n d th a tMr
. K i mo t o h a d c o mmi t t e d th e o v e r t a c t s a l l e g e d i n p a r a g r a p h B , b u tn o ti n A. The cour t deter m i ned that “any com bi nati on o f‘ yes ’ o r ‘ no’ an sw e r s t o th e s e t wo qu e s t i o n s c o u l d b e c o n s i s t en t because ea ch al l ege s s epara te and d i stinct f acts
. ” R. 72 at 10 . Th e c o u r t als o ob se rv ed th at “[t ]h e jur y s p ec ifica lly f ound that the Governm ent had pro ven b ey ond a re ason able d ou bt t h a t K im oto ha d com m itted f ou r overt acts i n furth eran ce of the con sp iracy, w hich i s m ore than suffi ci ent t o supp or t thei r ver dict

. ” Id.

B. A n alysis Inse ek in g t o ov er tu rn a j u ry ve rd ictb a s e d on th e s u ffici ency ofthe evi dence, M r. Kim oto f aces a “daunting ” t ask

.N o. 08

- 3731 11 U nited S ta tes v. R o berts, 53 4 F
. 3d 560, 56 9 ( 7th Ci r. 20 08) ( i nter nal quotati on m ar ks and c i tat i ons om i tte d). “In re vi ew i ng a chal l en ge to the suffi ci ency ofthe evi dence, w e d o n otw eig h th e e vid en c e, U ni t e d Sta tes v. Bowm an , 353 F. 3d 546, 552 ( 7th C ir. 2003 ), m ake credibili ty d e t e rm in at ion s, U ni t e d S ta tes v. Wool f ol k, 19 7 F
. 3d 900, 90 4 (7t h C ir. 19 99 ), or r e so lve te st im on ial in c on sis te n c ies , see U nited Sta tes v. Ho dg es , 315 F.3 d 7 94 , 799 (7t h C ir. 20 03 ).” U nited Sta tes v. Webber, 536 F.3d 584 , 597 (7th Cir. 2008). In st ea d , tak in g t h e e vid en c e in th e ligh t m os t fa vo ra b le to the Gover nm ent, w e “ ‘ w i l l ove rturn a co nvi cti on ba sed on insufficie nt ev i dence onl y i fthe re cor d i s devo i d of ev id en c e fro m w h ich a re as on ab le jur y c ou ld find gu ilt beyo nd a re aso nabl e doubt. ’ ” Id. ( quoting U ni t e d Sta tes v. Stev ens, 453 F.3d 963 , 965 (7th C ir. 2006)).

1 . I nt e ntt o De f r a ud Tur ni ngt o the fi r sto fM r . Ki m o to ’ s argu m en ts , he cl ai m s that, w i th re spect to eve ryco unt ofthe i nd i ctm ent, the Go v e r nme nt wa s r e qu i r e d t o pr o v e hi s i nt e nt to defr au d. H e fur th er m aint ains th at the G ove r nm en t att em pted to prove thi s e l em ent b y s how i ng ei therthat he i nt en tional l y m ar ket ed the pay- as- you- go car d as a cred it card or tha t he inten t ion all y m isl ed cons um ers in to be liev in g t h at th e p ay -as -yo u -go ca rd w ou ld res u lt in cred it r ep o r t ing. A ccord ing to M r. K im oto, th e j ury expli ci tl y r ej ecte d the fi rs t th eory b y a nsw er i ng “No” to Pa r a g r a p h A of th e verd ict f orm f or Cou nt 1, and there si m pl y was no e vi den ce pres en te d t o s uppo r t th e seco nd theo ry . W e di sag re e.12 N o. 08

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I nd e e d, the r e a s onth a tth e j ur y a ns we r e d “ No” t o Pa r a gr a ph 8 A m ay be that the language in Paragrap h A differed from that used by som e ofthe G overnm ent’ s w itness es . As s ugg es ted pre vi ously , the j ur y c oul d have r ea d Par agr aph A as s t at i ng thatM r. Kim ot o al o newas r es pons ibl e f or deve l opi ng the sal es m od el

. The j ury als o cou ld h a v e read the i nter rogatory as req u iring tha t a ll ofthe t argete d consum ers rec entl y had s u b mi t t e d a c r e di ta p p l i c a t i o n a n d b e e n tur n e d do wn . Ho we ve r , Po r c e l l i t e s t i fi e d tha t M r . Ki m ot o was the “ p rim ary au tho r” o f the sales m od el, no t its so leauthor. Tr. II I at67 ( em phasis add ed). Sim il arl y, Porcel li te st ifie d that the t arget consum ers w er e “ peop le w ith no credit, bad cr edit or other

w is e negati ve abili ty t o proces s a tr ansac ti on on a cre dit c ard”; (co n tin u ed ...) Pa r ag r aphA o fthe j ur y v er dict for m f o rCo untIo fthe i nd i ctm ent s tat ed: “Kim oto devel oped a s al es m od el fo r the s al e o fa M as te rC ar d Sto re d Value Debi t Car d as a cr edi t ca r d a nd t ar g et ed co ns um er s wi thb ad o rno c r e d i t, wh o h a d a p pl i ed f o ra n d h a d b e e n tu r n e d d o wn f or a cre ditcar d”; the j ury re sponded “N o” to thi s s tat em en t. R. 53 a t 2. Howev er, the j ur y ’ s r ej ec ti o n o fo ne or m or e o f th e f a c tu al a lleg at ion s c on ta in ed in Para gr aph A i s not i nconsi ste nt w i th i ts fi nd i ng that M r. Kim oto poss ess ed the re quis i te sta te ofm i nd f or fra ud

. The j ury coul d have be l i eve d that M r. Kim oto dr afte d the de ce pti ve s cr i pts us ed to m ak e sa l es , b utthe j ury m ay not have been convin c ed that he a lo ne had “devel oped a s al es m odel

. ” Alte rnat i vel y, the j ury m ay ha ve q ue stioned w he th er all of t h e targeted cons um ers “h ad ap p li ed f or and had been turn ed dow n for a c re d it c ar d .” 8N o. 08

- 3731 13

(
. . . c on t i nu e d) 8 he did not te st ify thatevery t a rgete d consum er r ece ntl y had a p p lie d fo r, an d b ee n d en ie d , a c r e d i t c a rd

. Id. at 58
. P or celli fur the r ex pl ai ne d the t ar ge taudi en c e ac c or di ngl y: Y ou w ant t o u se t h e exam ple ofa Chia Petor Ginsu K nife, peop le w ho cal l in and w ant t o bu y the prod uct over the ai r. The p osi ti ve creditpeop le are t he re spond ers w ho pu rch ased an d ha v e a v alid c r ed it card

. T he neg ativ e cred it peo pl e ar e the ones who s en d i n a m one y or der or who don’ tha ve a c re di tc ar d and e nded up notbuyi ng, but they did res pon d and tr y to plac e an order. Id. Fu rthe rm ore, th ere w as t e s tim ony from w hich the j ury c ou ld h a v e co n c lu d ed th at M r. K im ot o in te n tio n ally ha d m i sl ed co ns um er s i nt o b el i ev i ngtha t th e pay - as - y o ugo car d w oul d res ulti n cr edi t r ep or tin g. A s di scusse d previ ousl y, H oward, c o-ow ner ofA pex, te sti fi ed that he to l d M r. Kim oto thatthe car d s u p p lied byA pex w as not a cr edi t ca r d, di d no t ha ve c r edi t wor th i ne ss a nd c ou ld n otbe rep or te d on . SeeTr. VIat14 1- 42. A dd i ti onal l y, Porc ell i testifi ed t h at, w he n A ssail sw itche d sup p li ers (fro m A p ex to Sto n eb rid ge ), b ot h M r. K im ot o a n d P or c elli w er e a w ar e that use o fthe debi t ca rd co uld notbe re p o r t e d to cr ed it a ge n c ies
. SeeT r. II I at 3 7 (P or c elli tes ti fyi ng tha t S ton eb ridge to l d him “fl at out that they did no re port i ng” a nd thatPor cel l ito l d this t o M r. Kim oto )
. N eve rthel ess , the sal es scr i pts st i l li m pli ed th at th e c ar d ’s u se w o u l d be rep or te d

. Id. at41 (P or c elli tes ti fyi ng tha t, afterswit chi ng to S tone bri dge, the sal es sc r i pts s ti l lr ea d “ an d no th i ngl o o k s be tt ero n y o ur E qu if ax cred it r ep ort tha n a M aster C ard ”).14 N o. 08

- 3731 Essenti al l y, M r. Kim oto is ar gui ng tha t the te sti m ony of Po r c e l l i and Ho wa r d s ho ul d n o th a v e b e e n b e l i e v e d. H o wev er, i t w as th e pro vinc e o fthe j ur y “ to pa r se the f acts , to weigh the cre dibi l i ty of e ac h w i tness and to disr ega rd the te sti m ony ofwitnes ses i t found t o b e le ss cre dibl e o r not w or thy ofcr edence. ” Cart e rv. Chi cago P o lice O fficers , 16 5 F .3d 1 071, 10 81 ( 7th Ci r. 19 98) ( i nter nal quotati on m ar ks and ci tat i ons om i tte d). W e wil lnot se c on d -gu es s it s c re d ibilit y d et er m in at ion s.

2. A greem en t M r. K im oto also m aintain s tha t t h e e v id en ce w as insu ffi cient f o rthe j ur y t o c o nv i cthi m o n Co unt1 , the c o nspi ra cy count, bec au se the e vi dence does not est abl i sh that he and Po rce l l i enter ed i nto a “co m m on ag re em ent” to d efr au d

. SeeA pp el l ant’s B r. 25 ( quoti ng U nited Sta tes v. G ilm er, 53 4 F
. 3d 696, 70 1 ( 7th Ci r. 20 08 ))
. M r. Kim oto ex pla i ns that“[ e] ven i fthe j ury bel i eve d that [ he] knew orsho uld hav e know n the cre ditr epor ti ng r epres entatio n s w er e fa lse , no ev id en c e w a s p re se n te d th at h is p u rp or te d co -c on sp ira to r, P or c elli, sh ar ed th is kn ow ledge a nd j oi ned an ag re em ent to m ake such a m i sr epresenta ti on. ” Id. Mr
. Ki mo t o ’ s a r g u me n tmu s tf a i lf o rt wo re aso ns. Fi rs t, i t ass um es that the onl y fra ud ule n t s tatem ent i n the sal es scr i pt w as the re fer ence to E q u if ax r epo r ting . Howev er, s ev er ala sp ect s o fthe s al es a nd ve r i fi ca ti o n s cr i pts w er e des i g ne d t o mis l ea d the cons um eri nto bel i eving tha t they were se curi ng a cre dit, as o pp ose d to a debi t, card

. See G ov’ t Ex. 2aN o. 08

- 3731 15 (sc rip t re fer en c in g a cu st om er ’s a p p lica tio n f o r a c re d it car d and inf or m i ng the custo m ero fhi s e l i gibility to re cei ve “yo ur V isa orM ast er Card”)

. S eco nd , i t i gnor es ev id en c e in th e re c or d th at bo t h M r . K im ot o a n d P or c elli knew that ca rds s up p l i ed by St onebr i dge co uld notbe re port ed on, but they never thel ess co nti nued to em plo y the s cri pt thatr efer enced t he car d’s use be i ng r epor ted to Equi f ax . The r e i s ample ev i den ce i n the r ec o r d t o s uppo r t th e j ury’ s co ncl usi on that M r. Kim oto had the re quis i te i ntent to d efr au d and thathe a nd Por cel l i, i n f act, f or med a n a g r e e men tt o c o mm i tfr a ud

. Co ns e qu e nt l y, th er e is n o b as is on w h ich to ov er tu rn th e jur y’s ve rd ict
.
III D I SCOV ERY I SSU ES A . Overvi ew T h e a rg u m en t M r. K im ot o p u r su es m os t v igo ro u sly is that the Gove rnm ent e i theri ntenti onal l y with h eld o r destr oye d evi dence t h at w as cruci alto hi s abi l i ty to prese nt a com ple te defe nse. W e be gi n ourconsi derat i on by set ti ng f or th t h e appli cabl e l ega lst andards that gov er n thi s a re a. W e then shal l reco unt the proce du ra l co nt ex t i n whi chthe di st r i ctc o ur t addr es se d the se s ta ndards. W i th thi s ba ckg ro und , we shal ltur n to ea ch of the s peci fi c co ntenti ons ra i sed b y M r. Kim oto and ass ess th e d ist ric t c ou rt ’s d isp os itio n of ea c h

.16 N o. 08

- 3731 B. St a nda r ds 1. Bra dy v. M aryl and I n Brady v . M aryl and, 3 7 3 U. S
. 8 3 , 8 8 ( 1 9 6 3 ) , th e S u p r e me Court hel d that “ the s upp re ss ion by the pros ecuti on o f e v i de nc e f a v o r ab l e t o a n a c c us e d u po n r e qu e s tv i ol ate s du e pr oce ss w here the evi dence i s m ate ri alei therto gui l t or to punishm ent, i rr espect i ve ofthe goo d fa i th o r bad f aith of the p rosecu tion.” O v e r th e years, th e C ou rt ha s ex pan ded th i s duty i n s ev er alway s. In U nited S ta tes v. A gu rs , 4 27U. S
. 9 7, 1 07( 19 76 ) , the Co ur t he l d tha t th e du ty i s appli cabl e re gar dle ss of w hether ther e has b een a r eque stb y the a cc us ed. La te r, i n U ni t e d Stat e s v. B agley, 473 U.S
. 66 7, 67 6 ( 1985 ) , the Court m ade cl ear th at th e d u ty ap p lies to im p ea c h m en t e vid en c e a s w ell as ex c u lp at or y evid en c e . F i n ally , Kyles v . W hit ley, 51 4 U
. S. 41 9, 43 8 ( 1995 ) , es tabl i shed that th e du ty appli es to ev i d e n c e kn ow n to p olic e in ve st iga to rs ev en if un kn ow n to th e pros ecu tor. T he du ty of d is c lo su re un d er Brady, however, i s no t unli m i ted. W e hav e e xplained that “a Bradyvi ol ati on on ly oc c u rs if ‘m at er ial’ e vid en c e is w ith h eld , th at is ‘if ther e i s a r e a s o nab l e p r o b ab i l i t y tha t, h a d the e v i de nce been d isc los ed to the defe nse, the re sul t o fthe proceedi ng would have bee n differ ent. ’ ” U ni t e d S t at e s v. S t ott, 2 45 F. 3d 890, 90 1 ( 7th Ci r. 20 01) ( quoti ng B agley, 473 U
. S. at68 2)
. “F urther m or e, ‘ [ a] s l ong as ult i m ate disc l osur e i s m ade bef or e i t i s too l ate f or the de fen d an ts to m ake use ofany benefi ts ofev i de n ce, Due Pro cess i s s ati sfi ed. ’ ” Id. ( quoti ng Uni t e d S t at e s v . Zipe rst ei n , 6 01 F.2d 281 , 291 (7th C ir. 1979)).N o. 08

- 3731 17 Thu s, “[ t] o est abl i sh a Brady vi o l at i o n, the de fen dan t m us t pr o ve thr ee e l ement s: ( 1) the e vi den ce a t i ss ue w as fav or ab le t o th e a c c u s e d , e ith er be c au se it w as ex c u lpator y o r i m peachi ng; ( 2) the evi dence w as suppress ed by the Gove rnm ent, ei therwil l fully o r i nadvert entl y; and ( 3) the deni alwas prej ud i ci al

. ” U nite d State s v. R ober ts , 534 F. 3d 560, 57 2 ( 7th Ci r. 20 08)
. W e re vi ew a dist ri ct c o urt’ s Bradyde te r m i na ti o n fo ra n abus e o fdi sc r et i o n. U nite d States v. P ri ce, 418 F.3d 771 , 785 (7th C ir. 2005).

2. Ari zon a v . Youngbl ood T h er e i s a d iffer en c e “ b et w ee n th os e s itu at ion s in w hi ch the pol i ce f ai lto di scl ose to the defe nd ant e vi dence tha t i t k no ws t o b e mat e r i a l a nd e xc ul pa t o r y, a nd t hose si tu ati o ns i n whi chpo l i ce s i m pl y f ai lt o pr es er ve po te nti al l y e xculpato ryev i dence. ” U ni t e d S t at e s v. Chapar r oA lca nta ra , 2 26 F
. 3d 61 6, 6 23 ( 7th Ci r . 2 00 0)
. In A riz o na v. Youngb l ood, 48 8 U.S
. 51 ( 1988 ) , the C ourtaddress ed th e la tte r si tuati on. In that case , the Court hel d that, “u n l e s s a c r i mi n a l d e fe n d a n t c a n s h o w b a d f a i th o n t he par t o fthe po l i ce , f ai l ur e to pr es er ve po te nt i al l y us eful evi dence does not const i tute a deni alo fdue proc ess o f l aw . ” Id. at58
. I n such si tuati ons, f ailu re to pre ser ve evi dence i s no t a vi o l at i o n ofdue pr o ce ss r i g ht s unl es s th e d efend an t can de m ons trate: ( 1) bad f aith on t he pa rt ofthe gov er nm ent; (2) that the excul pator y v al ue o f the e v i de nc e wa s a pp a r e ntb e f o r e i twa s de s t r oy e d; and ( 3) that the evi dence w as of such a natu re th at18 N o. 08

- 3731 th e p et itio n er w ou ld be u n ab le t o ob ta inco m p ar ab le evi dence by othe r re aso nabl y a vai l abl e m eans. H ub anks v. Frank, 3 92 F. 3d 92 6, 9 31 ( 7th Ci r . 2 00 4) ( ci ting Youngb l ood, 488 U .S. at 5 8; C alif ornia v. Trom be tt a , 46 7 U .S . 479 , 488 -89 (19 84 ); U nite d States v. Watts , 2 9 F
. 3 d 2 87, 289-90 (7th Cir. 1994)).

3. J encks A ct F i na l l y, we tu r n t o di sc l o su r e r equi r ements u nde rthe J e nc k s Ac t, 1 8 U. S
. C. § 3 5 0 0
. As we h a v e e xp l a i ne d: T h e J e n c k s A c tw a s e n a c t e d i n r e s p o n s e t o th e S u p r e me Cou r t’ s ho l di ngi n Jenck s v. U ni t ed S ta tes , 35 3 U.S
. 65 7 ( 1957 )
. To e nsure the m eani ngful confro ntati on o f g o ve r nm en t wi tn es se s, the Actr eq uires the g o ve r nm ent, upon the defe nd ant’ s m oti on, to pro du ce s tat em ent s m ade by an y o f i ts wi tn es se s whi ch th e pa rti cul arwi tn es se s si g ne d, a do pte d, o ra ppr o ve d, a nd whi c h pe r t a i n t o the i r t e s t i mon y a t t r i a l

. 18 U
. S
. C. § 3 50 0(b ); s e eal s o Fed. R. Cri m . P. 26
. 2; U n i t ed S ta tes v. Lo pez , 6 F
. 3 d 1 2 8 1 , 1 2 8 8 ( 7 th Ci r . 1 9 9 3)
. The h o pe i s that these sta tem ents w i l laff or d th e d efense a basi s f o re ffec ti ve c r o ss - ex ami na ti o n o fg o ve r nm en t w itn es se s a n d th e p os sib le im p e a c h m en t o f th eir te st i m o ny witho uto ve r l y b ur den i ngthe g o ve r nmen twi th a du t y t o di s c l o s e a l lo fi t s i nv e s t i g a t i ve m at er ial. See U nited Sta tes v. O ’M a lley, 79 6 F
. 2d 891, 90 0 (7 th C ir. 1 9 8 6 ) ; U ni t e d S t at e s v. Sn ow , 53 7 F
. 2d 1166 , 1168 (4th Cir. 1976). U ni t e d S t at e s v. Johns on , 200 F.3d 52 9, 53 4 (7 th C ir. 20 00 ).N o. 08

- 3731 19 Turningto the sta tutory pr ovis ion, 18 U
. S. C. § 3 500( a) st at es : In any cr i m i nalpro secuti on br ought by the Unite d S ta te s, no s ta te m en t o rr epo rt i n the po ss es si o n o fthe Uni te d S ta te s whi chwas made bya Go vern m ent w i tness or pros pecti ve Gover nm ent w i tness (other than the d efendant) shal lbe the s ubj ect ofsubpoena, disc o v e r y, o ri ns pe c t i o n un t i ls a i d wi tne s s h as tes ti fi ed on di re ct e xam i nati on in the tr i alo fthe case . O n c e a wi tn e s s h a s t e s t i fi e d o n d i r e c te x a mi n a t i o n, h o weve r, “the co urt shal l, o n m oti on o fthe defe nd ant, o rder th e Uni ted Sta tes t o pr o duce a ny s ta te m en t
. . . o fthe w i tn es s in posse ssi on o fthe U ni ted S tat es w hi ch r el ate s to th e s u bj ec t m at te r as to w h ich th e w itn es s ha s t es tifie d .” 18 U .S.C . § 35 00 (b ). Su b se c tio n (e) d efin es st at em en t: T he t erm “state m en t”, as used i n su bsec tions (b), ( c), and ( d) of thi s s ecti on in re l ati on t o any witness cal l ed by th e U nited States, m ean s-- ( 1) a wri tt ens ta te m en t m ad e bys ai d wi tn es s an d s i g n e d o r o th e r wi s e a d o p t e d o ra p p r o v e d b y h i m; ( 2) a ste nogr aphic, m echani cal, el ectr i cal, o r othe r re cor ding, o r a t ra nscri pti on there of, wh i ch i s a substa nti ally verbat i m r eci talo fan o ra lst ate
me n tma d e b y s a i d w i tn e s s a n d r e c o r d e d c o n t e mpora neousl y with the m ak in g ofsuch o ra lst ate
m ent; o r (3 ) a st atem en t, how ever take n or record ed , or a tr an sc rip tio n th er eo f, i f an y, m ad e b y s aid w i tness to a gr and j ury.20 N o. 08

- 3731 18 U .S.C . § 35 00 (e). If t h e G ov er n m en t fa ils to co m p ly w i th an or der o fthe cour t t o del i vera w i tness ’ s s ta tem en t, “t h e c o u r t sh all st rik e fro m th e re c or d th e t es tim ony ofthe w i tness
. ” Id. § 3500 ( d). A l though no t s et f or th i n the text of the A ct i tse l f, cour ts have h eld th at r el i efmay no t be g r an ted unde rthe J en ck s Act wi th o ut a s how i ng o fprej ud i ce. See U ni t e d S t at e s v. Johns on , 20 0 F.3d 529 , 535 (7th C ir. 2000) (col lecting case s).

C. Proc edu r al Conte xt 1. Ea r l i erFTC Pro ceedi ngs On Januar y 9 , 20 03, the Feder alTra d e Com m i ssi on ( “ F T C ” ) fi l e d a c i v i l c o mpl a i n t a g a i n s t Mr
. Ki mo to a nd A ssa i l( “FTC acti on” ). Th e co m pla i nt al l ege d that a var i et y of in d ivid u als a n d c orpora ti ons l ed by M r . Ki m o to e ng ag ed i n a fra udul en t te l emar k et i ng sc h em e in v i o l a tio n of 15 U .S.C . § 45 (a). SeeFT Cv. Assail, Inc. , 41 0 F
. 3d 256, 25 9 ( 5th Ci r. 20 05)
. W i thi n a w ee k o f the fi l i ng, M r. K im oto had conta cted Robe rtDras kov i ch “to r epres ent hi m i nd i vi du al l y r ega rdin g potenti al c r i mi n a le x p o s u r e , a s w e l la s t o w o r ka l o n gs i de Edw ar d M o o r e r eg ar di nghi s r epr es en ta ti o n fo rthe pend i ng ca se [ FTC acti on]
. ” R. 14, A tta ch. 1 at 2. On S ept embe r 22 , 20 03 , M r . Ki m o to , Ass ai la nd the F TC en t e r e d i n t o a s t i p u l a t e d j u d g me n t
. Ac c o r d i n g t o t he te r m s o fthe s ti pul at ed judgment, M r . Ki m o to a nd Assa i lwer e joi nt l y a nd s ev er al l y l i ab l e f o r$ 10 6 m i l l i o n; ho w ev er, the j udg m en t was s us pen ded to the e xt en t that the a m ount e xc ee d ed M r. Kim oto ’ s a sse ts, wh i chN o. 08

- 3731 21

W e re ferenc e these proceedings because they bear on w hether 9 M r. K im o t o h ad access to ce rtain d ocu m en ts gen era ted in co n n ec tio n w ith th a t a ct io n . Seei nf ra pp. 58

- 59
. The y pl ay no oth er ro le in ou r con sid era tion of the issues b efore th is cou rt. T he G ov ern m en t refers to this p resen tatio n a s its 10

“ re v er se p ro ffer .” w er e t o b e liq u id at ed by an a p p oin te d rec eiv er . See A ss ail , 41 0 F
. 3d at 260. The st i pu l ate d j ud gm ent a l so provi ded f orthe court’ s r ete nti on o fj uri sdic ti on t o m od ify or enforce the order. One yearafterente ring the st i pu l ated j ud gm ent, th e U ni ted S tat es Dist ri ct Cour t forthe W est er n Dis tr i ct ofTexas did m odi fy the o rder

. The FTC’s co nti nued i nvest i gat i on r eve al ed that M r. Kim oto had at tem pted to hi de sev er alm i l l i on dol l ar s i n ass ets fro m the re cei ver . On m oti on of t h e F TC , ther ef or e, the dist ri ct c o ur tl i ft e d the s us pe ns i o n o n the s t i pu l a t e d j ud g ment. R. 59, A tta ch. ( Fina lM onet ar y J ud gm ent a s t o Defe nd ants K yle K im oto an d A ssail, Inc . ). 9

2. Rever se Pr of f er A s set forth p reviously , on J un e 20, 2007, a grand j ury re turned a fourt een- count ind i ctm ent a gainst M r. Kim oto
. The day be f or e M r. Kim oto ’ s a rr ai gnm ent a nd i ni ti al appearance , hi s co unselm et w i th Governm ent a tto rney s to v i ew a n eight-h ou rPo wer Po i ntpr es en ta ti o n. 10 Dur i ngthe Power Po i ntpr es en ta ti o n, the Go ve r nm en t ou tli ne d i ts th eory of th e c a s e th at, in th e sales and m ar-22 N o. 08

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D uring the in iti al app earance and arraignm ent, the tr ial 11 date w as se t for Au gust 27, 2007. k et i ngo fa de bi t ca r d, Ass ai l ha d us ed a te l emar k et i ng scr i pt, devel oped and approve d by M r. Kim oto , desi gned to m i sl ead prospecti ve buyer s into bel i eving tha t they actual l y were purchasing a cred it c ar d. The prese ntati on in cl ude d e xc er pts o fv i deo i nt er vi ews wi thM r . Ki m oto’s em p lo yees, a vi d eo interview of Porc ell i an d video intervi ews o fPo r cel l i ’ s empl o y ee s. As pa r t o fi ts pr es en ta ti o n, th e Gov ernm en t al so pl ay ed a numbe ro f“ ve r i fi ca ti o n” re cor dings , wh i ch co ntai ned m i sl eadi ng o r decepti ve sta tem ents.

3 . Mo t i o ns t o C o nt i nue A pp ro xi m ate l y s i x w eek s l ate r, o n A ugust 2 0, 20 07, M r . Ki m o to ’ s co uns elfi l ed hi s fi r stmot i o n t o c o nt i nue the t ri aldate. See R
. 8. M r. Kim oto ’ s co unselst ate d that 11 he knew “of at least 3 ,000 , 000 p ages of w ritten d iscovery and h und re ds oftho usands ofdi gi talr eco rdi ngs that need to be exam i ned i n prepar at i on f ortr i al

. ” Id. at3. M r. K im ot o d id n o t re q u es t a co n tin u an c e o f a sp ec ific p er iod , bu t a sk ed for th e a b i l i ty to su p p lem en t h is m oti on in f or ty- fi ve days b as ed on hi s ini ti alr evi ew o f th e d oc u m en ta tio n . Id. at 4. The Gover nm ent di d not o pp ose the m oti on, b u t reque st ed a tr i al dat e se t i n F eb r ua r y 2 00 8, a s o ppo se d t o the o pen - en ded r eque sto fM r . Ki m o to
. The Gov ernm en t n ot ed th at M r. K im ot o’ s c o u n se l ha d be en inv olv ed inN o. 08

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A fterfil ing i ts ori ginal m em orand um conce rning the t ri al 12 dat e, the Gover nm en tfi l ed a Su ppl em en t al M em or andum tha t inclu d ed as an attach m en t a n a p p lication f or attor ne y s’ fee s thatM r. Kim ot o’ s c ouns elha d fil ed i n the FTC a c t i on. The ap p l i c a tion f or fees reco u nte d tha t cou nsel h ad spe nt a p p ro xim at el y 5 92 hours i n the r epr es en t at i on ofM r. Kim ot o i n the F T C i n v e stiga tion , tha t he h ad b een eng ag ed b y M r. K im oto “to r epres ent him i nd ividually r egarding p otent ial cr im inal (co n tin u ed ...) h is d efe n se sin c e 2 00 3, w h e n t h e F T C br ou gh t a civ il acti on a gain st M r. Kim oto
. The Governm ent a l so i nfo rm ed the cour t that i t had m ade a re ver se proffer by w ay ofthe Pow er Poi nt pre senta ti on a nd thati t had “ag reed to pro vi de the dozens ofhour s o fvi deo in te rv iew s a n d t h e r ec or d ed te lem ar ke tin g c alls th at it has in i ts posse ssi on, sa m ple s o fw h ich w er e pl aye d du r i ngthe P o we r Po i ntp r e s e nt a t i o n. ” R
. 9 a t2
. I tn o t e d, ho wev er, tha t i t was “ awai tingd ef en dan t pr o vi di ngthe gov er nm ent with an e xter nalhar d dri ve u p on w hi ch to tr ansferthe e lect ro ni c ev i dence. ” Id. at2-3 . Fin ally , i t advi sed that“there were sea rche s co nd uc te d at three l oca ti ons and the o ri gi naldocum ents se ize d are i n an offi ce in Fai rv i ew H eig h ts m ai ntai ned by the Pos tal I n s p e c t i o n S e r v i c e . T h e s e d o c u me n t s a r e a v a i l ab l e to t he defe nd ant. ” Id. at3. A lth ou gh a c kn ow led gin g th e v olu m inous do cument at i o n a t th e defen dan t’ s di spo sa l, the Gover nm ent a l so i nfo rm ed the cour t that “ the b u siness r ec o r ds ar e l ar g ely pe r i phe r alt o the k eyi ssues inthe case wh i ch depend f orthe m ostp ar t on the sc ri pts, tr ai ni ng m anual s, co ntra cts and em ai l

. ” Id. a t 4. The 1224 N o. 08

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(
. . . c on t i nu e d) 12 exposure, as w el l as to work a lo n g s ide Ed w ard M oore re g ard ing his rep resen tatio n for th e p en d ing case ,” a n d tha t it w as cl ear atthatti m e that M r. “K im oto could fa ce cr im inal pro s ec ut i on. ” R. 14 , At t ac h. 1 at2. The affi davi ti n s uppor tof the app li cat ion f or fees averred tha t co unsel had spent hours “[ a] nalyzing volum inous m ater ial s and docum ents , ” i d. , E x. 1 to Att a ch . 1 ¶ 3, and refle ct ed ov er forty t im e ent ri es dedi c at ed t o r evi ewi ng doc um en t s or othe r di s c ove ry . In th e seco nd m otio n, in ad d ition to reco u ntin g the tria ls to 13 w hich he a lrea d y w as co m m itted , M r. K im oto ’ s cou nsel a lso r e i t e r a t e d the vo l umi no us di s c ov e r y tha tn e e ded to be re v ie w ed in p re p a ra tio n for tr ia l. S eeR.16 at2. T h e d e fe n s e s e n ta h a r d d r i v e t o t h e G o v e r n me n to n S e p t e m- 14 b er 24 , 20 0 7
. S eeR. 4 2 , Ex
. E. dist ri ct c ourtgr anted the c on ti nuance and seta tr i al date o fFebruar y 4, 20 08. I n a tele c onferen ce h eld later i n A ug us t, M r. K im oto’s co uns el, M r . Dr as k o vi ch, i nf o r m ed the c o ur t th at, due to s ev er alo th ert r i al s sc he du le d i n e ar l y 2 00 8, he w ou ld n ot be able to prep are ad eq ua tely f or M r. K im oto’s tr i ali fi t w er e to com m ence on F ebr uary4, 20 08. The co urt, ther ef or e, as ked M r. K im ot o’ s co unselto fi l e a nother m oti on t o continue. M r. Kim oto ’ s co u n se l di d fi l e a seco nd m oti on, wh i ch w as gr anted bythe cour t. 13 M r. Kim oto ’ s t ri althen w as re scheduled for M ar ch 31, 2008
. O n O ctob er 22, 2007, the G overn m en t prov ided a hard dr i ve t o Mr
. Ki mo t o ’ s c o u n s e lc o n t a i n i n ga l lo ft he

14 dig i taland v ideo info rm ati on that had be en r evi ew ed byN o. 08

- 3731 25 th e G overn m en t in prep ara t io n f or the reverse proffer. Sp ec i fi cal l y, Pos talInspectorA dam Latham wrote to M r. Dra skovic h : “ E nc losed you w il l fi nd the h ard d rive w ith our electron ic discove ry f or the ab ove referenced cas e. On the di sk you w i l lfi nd fi ve data dir ecto ri es . . . . ” R. 40, A tta ch. C. The data di re cto ri es l i ste d w er e “ A ssa i l, ” “ FBI, ” “ FTC,” “Assai land BA BC Vi deos” and “Voi ceLog. ” Id. The or i gi n of al l of the in for m ati on was pr o vi ded. Addi ti o na l l y, i t was c l ea r thatthe d isc ov er y d i d n otrep re se n t a ll of th e in for m at ion w ith in the Gove rnm ent’ s p oss ess i on, but only thatwhi ch the G o vern m ent h a d rev iew ed

. S pec i fi ca l l y, wi thr es pec t to the V oic eL og d ire c to ry , In sp ec to r L at h am st at ed : [ T]hi s di re cto ryco ntai ns di gi talaudio r eco rdi ngs ofBA BC , F A LC , and A ssa i lpro gr am sa l es ver i fi cati ons that w er e r eco rded by Voi ceLog. The 75 0+ fi l es i n th i s d i r e c t o r y a r e t he di g i t a lr e c o r d i n g s th a twe d ow n loa d ed fr om V oi ceLog’ s s er ver

— t he re are s e ve r al h u n dre d t ho u s an d othe rv e r i f i c at i on s tha twe did no t review
. Id. ( emphas i s a dded)

. F o l l o wi ngthi s di sc l o su r e, the defen se di d no t r eque stthe di g i ta ldi scove r y i n a ny othe r f or m at, nordi d i t r equest add i ti onaldi gi taldi sco ver y. A s w ell, th e d efe n se d id n ots ee k a c c es s t o th e re p os ito r y o fdo cument ary and di g i ta le vi den ce a t th e Fai rv i ew H ei ghts f aci l i ty at that ti m e. Three m onths l ate r, o n January29 , 20 08, M r. Kim oto fi l ed hi s thi rd m oti on t o continue. A gain the re as on ci ted f o rthe r eque st ed co nt i nua nc e was the “ vo l um i no us26 N o. 08

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At thi s poi nt, the d efense t ea m s t i l l ha d notr evi ewed the 15 evi denc e l oc at ed a tthe Fa i rvi ew Hei ght s f ac i l i t y. M r. Dr a s k o v i c h a c k n o wl e dg e d a tth a tt i me th a tt he 16 V oi c eLogve ri fi c atio ns r ec ei ved wer e “j us ta m i nut e s am pl e of over 300, 000 rec ordings m ade.” R
. 18 at 2. Th e Go ve r nme nta l s o a r gu e d tha t, “ [ w] hi l e the r e i s s ub

17 s t ant i al doc um en t ar y e vi denc e and vo l um i nous ve ri fi c at i on c a l l s , wh a ti s mi s s i n g fr o m de fe n da n t ’ s mo t i o n i s h o w a revie w of a l l of the r e c or ds s e i z e d f r om the s e a r c h a nd a re vi ew ofal l the ve ri fi c at i on re c or di ngs i s e i the r ne c es s ar y or he l pful to the deve l opm en tofa defen s e gi venthe gove rn m ent’ s indict m ent and the ory ofthe cas e. ” R.19 at6. pape rdi s c o v e r y i n thi s c a s e , ” a s we l la s the “ e xt ensi ve 15 dig i taldi sco ver y” re cei ved from the Gover nm ent. R. 18 a t 2. The Go vernm en t o bj ec te d t o the c o nt i nu-

16 ance pr i m ar i l y o n the gr ound that, al th ou gh there w as vo l um i nous paper and digi taldi sco ver y, l i ttl e o fthat m ate ri al w as p er ti nent t o the i ssues i n the case

— w hether th e scripts used to m arket th e pa y-as-you-g o c a rd w ere fra ud ule nt
. A dd i ti onal l y, the Gover nm ent no ted that M r . Dr as k o vi chhad r epr es en te d M r . Ki m o to i n the F TC acti on, and, ther ef or e, pre sum abl y was fam i l i arwith m uch ofthe docum entat i on a t i ssue. 17 T h e d ist ric t c o u rtd en ied th e t h ird co n tin u an c e. It ackno w l ed ge d t hat there was a g re at dealo fev i dence avai l abl e t o the defense, but note d that M r. Dras kov i ch ha d b ee n inv o l ve d i n the c as e f o rs o m e ti m e, tha t th e Go v e r nme nt ’ s the o r y o fthe c a s e w as s t r a i g ht f o r wa r d, an d tha t th er e wa s n o s ug g es ti o n tha t “the Go ve r nm en t ha[ d] s hor tened [ M r. Kim oto ’ s] e ffecti ve prepar ati onN o. 08

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Prior to this ti m e, i n N ovem ber 2 0 07, M r. K im oto had 18 re ta in ed a se rv ic e t o re v ie w d ig ita l e v id en ce . tim e or f ail ed to provid e h im w ith ne cess ary d iscovery m ate ri al s. ” R. 21 at 4.

4. D is c ov ery On Febr uary27, 20 08, m em ber s o fthe defe nse t eam vis ite d th e F air vie w H eig h ts loc at ion to rev ie w th e e viden ce i n the G over nm en t’ s po ss es si o n. M embe r s o fthe defe nse t eam spent f our days r evi ew ing docum entat i on i n both paper a nd di gi talf or m ; t h ey had acces s t o al lo f the Gove rn m ent’ s e vi dence, co nsi sting o fthi rty- thre e bo xe s of doc um en ts a nd thi r te enha r d dr i ve s. Af te rthe de fen se tea m departe d, copyi ng o fdocum ents continued w i th the co oper ati on, and und erthe supe rv isi on, o f postali nspecti on work er s. On app ro xi m at el y M ar ch 7, 20 08, the defe nse re tained the s er vi ces ofDanie lLibby, a for m ernaval cr y p t o l o g i s ta n d e x p e r ti n c o mpu t e rf o r e n s i c s ; the 18 defe nse e ngage d Libby ’s ser vi ces f orthe sol e purpose o f revi ew i ng the di gi talev i dence pro vi ded

. On M ar ch 11, 2008 , Libb y requ ested th a t t h e d efense team proc ure f o r e n s i c i ma g e s o fth e d a t a tu r n e d o v e rb y th e G o v er nm ent. A ccor ding to Libby, “[ a] for ensi cal l y s ound im age ” i s a by te i m age o fthe hard dri ve, notsi m p ly a c op y o f the file sys tem , and “i nsures thatthe evi dence i s no t al ter ed and orta i nted durin g th e r evi ew ” o fthe dig i tal evi dence. Tr. o fH ear i ng on M oti on to Dism i ss at 10. Libby w as abl e t o deter m i ne r i ght a w ay that the hard dri ve28 N o. 08

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The record is not c le ar as to w hen, i fat all, thi s re q u es t was 19 rec ei ved i n w ri ti ng. O n e o f M r. K im oto’ s counsels tat es i n an affidavit that h e calle d A ss is tantUn it ed Stat es Attorney ( “AUSA”) Dan Reppe rtc onc er ni ng the r eques t, an d, whenhe did not rec ei ve a res pon se , he s ent the reques t by f ax ( dated M a rc h 13 , 20 0 8 ). S eeR .30, Ex. 1. AU S A R e p p e r t rep resen ts in the res pon se to the m oti on to dism iss thathe r ece ived a voice m ail from def ense counselon M arch 17, 2008, w hen he w as i n t ri al

. Atthatt i m e, he m i s under s t ood the na t ur e of the req u est; he b eliev ed tha t d efense co u nsel n eed ed a cod e to u nlo ck som e of the files, a n d he in stru cted his assistant to pro vi de i tt o de fen s e c ouns el

. Acc or di ng t o AUSA Reppe rt, he never rec ei ved a hard copy of the re quest, and the t rue nature ofthe r eq u es t was not m ade kno w n to hi m untilM arch 21, 2008

— the day his tria l w a s com plet ed

— w he n h e sp ok e w ith M r. D ras kov ic h by te le pho ne. p ro vid ed b y th e G ov er n m en t w as n ota fo re n sic ally so u n d im ag e. Id. at72
. So m eti m e be tw een M ar ch 12 and M ar ch 17, 20 08, defen se c o uns elwro te t o the a tt o r ne y for the Go ve r nm ent c oncerni ng the f or ensi c i m age s re q ueste d by Libby ; co unself or M r. Kim oto st ate d: “[ W ] e hav e r e-

19 ce i ve d a s ubs ta nt i ala m ou nto fdi sc o ve r y, i nc l udi ng, b ut n o t l i mi t e d t o , a h a r d d r i v e c o n t a i n i n g e x t e n s i v e do cum entat i on. H owever, we are o fthe bel i efthi s i s no t a f or ensi c copy, and doe s not conta i n eve ry pie ce of di gi tal evi dence r eco ver ed. ” R. 42, Ex. K at 1. Counselr equeste d a “ [ f ] or ensi cal l y s ound copy .

. . o fA LL data deri ved fro m Info rm at ion Sys te m s s eiz ed an d /or fore n s i c ally acqui re d i n thi s m att er . ” Id.N o. 08

- 3731 29 On M ar ch 21, M r. Drask ovi ch and A U SA Rep pert spoke over th e teleph one . Du ring this con versat ion, M r. Drask o v i c h i nfo r med AUS A Re pp e r ttha th e h a d b e en oper ating under the be l i efthat t h e har d dri ve provi ded to h im in O c to b er 20 07w as a c o m p l e te , fore n sic ally so und co py of all o fthe dig i tali nfo rm ati on in the Gover nm ent’ s pos ses si on, ra therthan j ust the m ate ri al s that th e Gov ernm en t ha d r ev i ewe d i n pr epar at i o n fo rthe re ver se proffer . A l though AU SA Re p p er t di d not be l i eve that ther e was any genui ne questi on co ncer ni ng wh at ha d been prov ided , based either on th e d igit a l inform at ion contained on the har d dri ve oro n the cove r let te r ac c om p an yin g t h e h ar d d r ive , he relu c ta n tly ag r ee d no t to o ppo se a mot i o n t o c o nt inu e s houl d o ne be fi l ed. I ns te ad o f se ek i ng a co nt i nua nc e to r ev i ew the a ddi t i o na lm at e r i a l s , h o we v e r, Mr
. Ki mot o fi l e d a m oti on t o dism i ss on M ar ch 24, 20 08. N eve rthel ess , i n re sponse to the re q u estm ade by the de fen se, the Gover nm ent s ent a l lo fi ts or i gi nal dig i talev i dence, notco pie s, byExp ress M ai ldi re ctl y t o Libb y f o rhi s r ev i ew. Libb y s ta te d tha t “thi s [ wa] s th e fi rs t t i m e in [h i s] car eerthatthe Gover nm ent ha[ d] e ver provi ded o ri gi nalev i dence. ” Tr
. VIat25
.
5. M ot i on t o Dismiss I n hi s m oti on t o d ism i ss, M r. Kim oto fi rs t r eco unted the defense tea m ’s re view o fthe dig i talev i dence pro

vid ed by th e G ov er n m en t. H e s ta te d : Because o fthe volum i nous nature ofthe dig i taldi sco ver y, C ou n se l ret ain ed

. . . P ro Se ar c h Str at e g i e s , In c ., a30 N o. 08

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M r. K im oto ’s m otio n, ho w ev er, did no t pr ov id e the d ate 20 thathis cou n sel w as inf orm ed b y ProSearch that the digit al d iscov ery p ro v id ed “d id no t ap p ear to be a c om p lete f orens iccopy.” R
. 30 at 3. com pany speci al i zi ng i n col l ecting, prese rv i ng, pro cess i ng, cul l i ng, r evi ew i ng and pro du c i ng di gi tal in for m at ion
. . . . U pon b eginni ng the i r w or k, Pro Se ar ch advi sed Counsel thatt he di sco ver y pr ovi ded to the defe nse di d no t appe art o b e a co m pl et e f o r en si c cop y, a nd that such w as necess ar y t o ver i fy the data as accura te a nd u na l t e r e d. R. 30 at 2- 3. 20 M r. K i m o to ’ s m o ti o n the n wen t o n t o e xpl ain the eff or ts ofhi s t eam to l oca te tw o e- m ai l s, wh i ch had been disc ussed atl ength i n the re ver se profferpro vi ded by the Gove rnm ent. M r. Kim oto descr ibed the disc ussi on o f the e

- m ai l s in the re ver se profferas f ol l ows: M r. A ro nson a nd A ssi sta nt U ni ted Stat es A tto rney Br u ce Reppert spent al m ost se ven m i nutes speci fi cal ly add re ssing two em ai l s s ent fro m Pete r Po r ce l l it o Al anAro ns o n o n orabo utJ ul y 23 , 20 02 a nd Augus t 6, 2 002. Acco r di ngt o the Go ve r nm en t ( i n the v i d e o ) , th e s e e ma i l s l a i d o u tMr
. P o r c e l l i ’ s s c h e me f o rc ha ng i ngc om pan y na m es t o a vo i d pr o se cut i o n. T h es e e m ails ind ica te d th at n e w co m p an ies w ou ld be f orm ed ev ery f o urt o s i x moths [ si c] i n di ffer en t ci ti es wi thdi ffer en t CEO’ s [ si c] , woul d m ar ket th eN o. 08

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S pe c i fi c a l l y, Mr. Ki m ot o a r gu e d: 21 I t is im p o r t a n tt o n o t e th a tth i s c a s e r e v o l v e s a r o u n d the real m ofdigit al f orens ic s and e- disc overy, and that such ar e diffic ult concepts f or m any to und ers tand. E-dis covery and dig i t al f or en s i c s ar e i m por t antbe c aus e the y a re the only w ay to v er ify that a com plet e re cord ofthe al le ged (co n tin u ed ...) ex ac t s am e t h in g a s t h e p re vio u s c om p an ies , w ou ld all b e c ont roll ed by M r. Porcelli, and w ou ld sit dorm ant o nce the co m pla i nts g ot too hi gh. A ccordi ng to th e t es tim on y, th es e em ails w er e b et w ee n M r. P or c elli and M r. A ro nson o nl y. R. 30 at 4. Acco r di ngt o M r . Ki m o to , de spi te a n exh au st i ve s ea r ch, hi s te am co ul d no t locate the e - m ai l s an y wher e i n the d igit al m at er ials p ro vid ed by th e G ov er n m e n t . Inall, M r . Ki m o to c l ai m ed th athi s co m put ere xpe r ts c o ul d fi nd o n l y a p p r o x i ma t e l y o n e h u n d r e d P o r c e l l i e - ma i l s , c o mpared to the thousands that M r. Kim ot o bel i eve d m ust h av e e x ist ed . A c c or d in g t o M r. K im ot o, “ [ t ] he mi s s i ng e ma i l s . . . a r e c l e a r l y e x c ul pa t o ry be c a us e t he y s ho w t he p res en c e o f a co n s p ir a c y b etw ee n M r. P orc elli an d M r. A ron s on ou ts id e t h e p res en c e o r k n ow led ge of M r. K i m ot o, and t hey have st r ong i m peachm ent val ue aga i nst M r . Por cel l i ,a k ey g ove rnm ent w i t ness . ” Id. a t1 2 ( e mpha sis i n or i gi nal )
. A dd i ti onal l y, M r. Kim oto ar gued th at th e fa i l u r e to p ro vid e h im w ith a c om p let e fo re n sic cop y of all d igi tal fi les im p aired his abili ty to p rep are a d efe n se . See id
. at 15. Final l y, M r. Kim oto subm i tte d 2132 N o. 08

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(
. . . c on t i nu e d) 21 d ig ita l cr im e sc en e a re k ep t. . . . W ith o u t [a for en sic re co rd ], the re is no w ay to v erify w ha t the sou rce o f the d ata is, w he n i t w a s m od ifi ed , w ho m od ifi ed it, w ho reg u larly ac c es s ed i t, ho w itwas pr oc es s ed, wher e i twas s t or ed, an d how i twas ne t worke d thr ougho utthe workpl ac e. W i thout thi s f or en sic copy, M r. K im oto f orced [ si c] to look at datab a se s thatare not l inked prop erl y, and are therefore, i nac c es s ibl e. The re f or e, he i s unabl e t o e ven r efer en c e the his tori es ofthe al le ged vict im ’ s [ si c] i n thi s cas e. R
. 30 at 15. M r. Kim ot o a l s o c onc l uded that, bas ed o n the s i gni fi c anc e of 22 the ev id ence, “[ t] here c[ ould] be no othe r c onclus ion than tha t t he go v ern m en t ha s acted in b ad f aith in failing to p ro v id e M r. K i m o t o w ith a d igita l f or en sic cop y of the ev idence. ” R.30 at17. th athe s ho ul d no t be punished “ be ca us e th e Gov ernm ent f ai l ed to proper l y prese rv e or m ai ntai n a d igit al f o r en si c co py o fthe d at a. I t was the Go ve r nm en t who ra i ded bo th BA BC and A ssa i l, and w ai ted five ye ar s t o pros ecute the c ase . ” R. 30 at 16. 22 Inits r e s p on se , th e G ov er n m en t p oin te d ou t t h at it ne ve rh a d r e c e i v e d a r e q u e s tf o ra f o r e n s i c a l l y s o u nd i m ag e unt i l M ar ch 17, 20 08
. W he n i t di d so , th e G over nm ent a gr eed to s hi p al lo fthe or i gi nalco m pu teri m age s to Libby ’ s l abor ato ry ; thi s wa s done on M ar ch 28, 20 08, via E x p re ss M a i l. T h e G ov er n m en t a lso n ot ed th at, in pape r s fi l ed wi ththe c o ur t, M r . Ki m oto st at ed th athe ha d r et ai ne d a n inv es ti g at o r, who ha d b ee n r ev i ewing dig i taldi sco ver y s i nce N ov em ber1, 20 07; acc or ding toN o. 08

- 3731 33

I ndee d, i twas appa ren t to Li bby, who was r et ai ne d on 23 M ar c h 7, 20 08 , thathe ne ede d the f or en s i c fi l es t o ve ri fy the au the nticity of the d igita l files. W ith res pect t o the all egati on that the G overnm en t had 24 “br oke n l i nks with o the r c om put ers, ” R .40 at12 , the Gover nm en t exp lain ed tha t it had “en cou nte red this p ro b l e m w hile w e were t rying t o acce ss cus tom er database s in Ass ail ’ s el ectr onic fil es i n an eff ort to i d en tify vict im s, ” id

. Itfurther st ated tha t“ [ t] here we r e n o ne t wor k s c he m a t i c s i n the As s a i l r e c or ds s e i z e d du r i n g th e s e a r c h a n d h e n c e th e r e wa s i n s u ff i c i en t info rm ati on f rom w hich the database could be rec onst ructe d given the brok en l inks. To est ablis h thatthe re were broken l i nks i s a f ar c ry fro m e s t abl i s hi ng thatthe gove rn m en t h a s ‘d e st r o y e d ’ a nythi ng . ” Id

. th e Gov ernm en t, “ i t sh ou ld ha ve b ee n obv i o us tha t th e el ectr oni c disc ove ry provi ded di d not co nsi st ofco m ple te
‘ f o r e ns i c ’ i mag e s ” b e c a us e the “ i mag e d h a r d d r i ve co nt a i n [ e d ] e x e c u t ab l e fi l e s a s we l la s d a t a a nd w or ki ng fi l es. ” R. 40 at 11. 23 Tur ni ng t o M r . Ki m o to ’ s al l eg at i o n tha t th e Gov ernm en t h ad d es tr oy ed e -m ails b et w ee n A ss ail a n d P or c elli, 24 the Gove rn m ent a rgued that the cl ai m was f ounded o n no th i ngmor e th ans pec ul at i o n: I n or der t o re ach this concl usi on, the defe nd ant has to sta ck an i nnu en d o upon an al re ady l ar ge pil e o f ba se l es s an d gr atui to us as su m pti o ns . Fi r st, the de fen dan t as su m es tha t BayAre a Bus i ne ss Coun cil mai ntained an em ai lse rv ero n prem i ses atthei r offi ces i n Ta m pa. The r e i s no ev i den ce o f th at
. S ec o nd, de fen dan t m us t as su m e th atBa y Are a B us in es s Cou n-34 N o. 08

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c il m ai n t ain ed a p olic y of a rc h ivin g t h eir em ail, i nste a d o fp ur g i ngi t
. T he r e i s n o f o un da t i o n f o rthat

. Thir d, defe nd ant m ust a ssum e that the em ai lse rv er wa s o n h a n d a n d th e d a t a i n t a c t a t th e t i me the Feder alTra de Com m i ssi on s uccessfu l l y threw Bay A re a into re cei ver shi p. . . . Fo urth, defendant m ust ass um e th at P or cel l ise nt hi s e m ai lthr ough Bay A re a’ s e m ai lse rv eri n the fi rs t pla c e. H e a pp ear s t o have used an i nter net e m ai lacc ount e stabl i shed w i th Com pu serve . Fi fth, defendant ass um es that w hat few em ails t h e g ove rnm ent has used i n i ts case i n chi ef w ere recovered from that em ailse rver, also an u nw arra nted ass um pti on a s the go ver nm ent found p hy sical copi es pri nted i n Bay Area’ s fi l es at t h e t i m e o fta ke over. Id. a t 1 3-14. F o cus i nga g ain o n the e - m ai l s, the Go ve r nm ent s tat ed that i t was “p ar ti cul ar l y di si ngenuous” that M r. Kim oto was ar gui ng tha t a du e p roces s v i ol ati o n a r o se a s a r es ul t of th e Gov ernm en t’ s no t di sc l o sing th e e -m ails

. Id. at16 . I t s ta te d : [ T]he em ai l s w er e featured pro m i nentl y in the gov er nm e nt ’ s r e v e r s e pr o ffe r i n the v i de o t e s t i mon y o f Ala n Ar o ns o n whi chwas e xhibi te d t o de fend an t a nd h i s co un s e la nd i n f a c tp r o v i de d i n t ot o o n the externalhar d dri ve i n Octobe r. The f act that defe nse coul d not l oca te the har d cop ies in the fi l es they i nspected and chos e no t t o speci fi cal l y r equest them fro m the gov er nm ent doe s notes tabl i sh e ither that th ey h av e b ee n “d es tr oy ed ” o r n otp ro p er ly di sc l o se d .

. . . I t c an har dl y b e sa i d tha t th e g o ve r n-N o. 08

- 3731 35

Althoughno tr ai s ed i n the m ot i on t o di s m i s s , the Gover nm en t 25 al s o a ddre s s ed Mr. Kim ot o’ s c om pl ai nt, r ai sed d ur i ng the c ourse o f tri al, thaton l y t wo- thi rds ofon e per c en tofthe consum er c om plaint s m a d e to SO S w ere available i n pap er f or m . Bec aus e the re was t es t i m ony thatappr ox i m at el y on e m i l l i on c om pl ai nt s wer e l odge d, the d efe ns e ar gue d, the G overnm ent m ust have d es tr oyed the rem a in ing s everal hun dred thousa nd com plaint s. The G overnm ent res pon ded thatthi s w as a “m ass ive no n s e qui t ur . ” R. 4 0 a t1 5
. I tc on t i nu e d: J a y La nkford t e s t i fi e d tha ta l l the s e c ompl a i nt s s ho ul d b e o n th e “ se r v e r .” M o r e o v e r, g i v e n th e f a c tth a tS O S ’s netwo rk and A ss ail ’ s se rver i n K ansas City were ex

c h an g ing d ata on a d aily b asis, g iv en the fact tha t A ssa i l ’s offices in K an sas C ity w ere n ev er ra id ed , certa inly K im oto sho u ld cu rren tly h av e this d ata un l e ss, tog eth er w ith Dunn’ s c om put eran d Ass ai l s ’ [ s i c ] e m ai l i n St. Geor ge ( a c c or di ngt o Dun n’ s t e s t i m on y) , the da t a wa s de s t r oyed atthe di re c t i on ofKim ot o h i m s el f

. An e xa m i nat i on ofthe stack of com p lain ts t ha t d efend an t intro d u ced sug g ests tha t these a re sim p ly selecte d p r into u ts of w ha t w as or iginall y enter ed ele ct ronic all y in Ass ail ’ s sys tem
. Ifthe y w ere origi na l d o cum ents , pres um ably they wo uld hav e been ha nd w ritten
. . . . F or som e rea son , som eo ne d ecid ed to print out the com plaint s w e have. Id. m ent has f ai l ed to “pro perl y di scl ose ” e vi dence w hi ch i s featured i n a Po w er Poi nt sho w n to the defe nd ant. Id. at16

- 17. The Governm ent furthera rg ued that 25 M r. Kim oto “m i sund er sto od” the pro secuti on’ s Brady obl i gat i ons; i t e xplained that “[ t] he go vern m ent’ s obl i gati on i s t o m ake ev i dence ava il able, w h ich it h as d on e . . . . ” Id. at17
.36 N o. 08

- 3731 Aft e rt r i a lc o mm e nc e d, the di s t r i c tc o ur the l d a hear i ng o n the m oti on t o dism i ss. Duri ng the h ea rin g, M r . Ki m o to pr es en te d e xt en si ve t es ti m o ny b y Libb y a nd o th erwi tn es se s, a s wel la s ar g um en t byc o uns el. The cour t denie d the m oti on by or al rul i ng on A pril 16, 20 08, w hi ch w as f ol l owed bya w rit te n or der i ssued o n M ay 8, 2008
. In i ts or der, the di str i ct c ourtco nsi dered wh ether th e failu re to tu rn ov er d igit al v er sio n s o f P or c elli’s e-m ails o rthe f a i l ur e t o s up pl y Mr
. Ki mot o wi th a f o r e ns i c c o py of al l of the dig i tal fi l es vi ol ate d e i ther th e d u ty establ i sh ed i n Brady v . M aryl and, 373 U
. S. 83 ( 1963 ) , to d isc lose ex c u l pator y e vi dence orthe du ty est abl i shed und er Arizona v. Yo un gb l ood, 48 8 U.S
. 51 ( 1988 ) , to pre ser ve evi dence. The di str i ct c ourtr ej ecte d both c l ai m s: K i m oto ’ s a sse rt i ons re gar ding the “m i ssing e- m ai l s” do not ri se abov e the l eve lo fspecul atio n. W hat em er ge s fro m the parti es’ subm i ssi ons and fr om testim ony i s not a d ep iction of an y anim us tow ard K i m oto o r any desi gn o r pu rpos e to d ep ri ve hi m o f excul pator y evi dence but a singul ar l y c oo perat i ve eff o r t by th e Gov ernm en t to appr i se Ki m o to of the c as e a ga in st h im an d to p ro vid e h i m w ith all re l evantdi sco ver y.

. . . M r. Libby tes ti fi ed that there w as nothi ng unusual i n the w ay that the fi l es, i denti fi ed as “nati ve” or “s ec o nd g en er at ion,” wer e fi r stpr o vi ded bythe Gover nm ent. Libby expla i ned that a for ensi c i m age col l ects ea ch bi t a nd i s aco m ple te re p re senta ti on o f o r i g i na lmedi a. A se co nda r y c o l l ec ti o n, s uc h as heN o. 08

- 3731 37

r ec ei ve d, i s th e r es ul t o ff o r en si c ac quisit i o n a nd proce ssing ofthatdata. Libby tes ti fi ed that i t was re ad ily ap p ar en t t h a t t h e files w er e n otfore n sic i m age s

— and did not pu rp ort t o be

—buts ec o nd g e n e r a t i o n fi l e s i n wh i c h d a t a wa s e x t r a c t e d by t he o r i g i na l ex ami ne r an d pr o duce d to ag en ts in co nj uncti on with thei r in vesti gat i on. The Courtnot es th at K im ot o’s inv es tig at o r , R ob er t L aw so n, ac kn ow ledged thathe ha d rec eive d the har d dri ve fro m K i m oto ’ s co unsel on N ove m ber1, 20 07, and had been re vi ew i ng di sco ver y a n ave ra ge ofsi x h ou rs a day. T h e f i l e s w er e a lso rev iew ed by K im ot o’s co u n se l, D am ian Sh ee ts , w h o p ro fes se d to b e kn ow led ge ab le about com pu ter s. G i ven that i t was “r eadi l y a pp ar ent” that th e fi l es w er e no t for ensi c i m age s, Kim oto shoul d have be en aware w el lbefor e M ar ch 17, 20 08, tha ts e c o nd g e ne r a t i o n fi l e s h a d b e e n pr o v i de d.

. . . U pon i nquir y b y th e C ou rt, M r. Libby sta ted that the har d dri ves that w er e s ent t o hi m w er e no t those tak en fro m m achi nes a t the ti m e th e w ar ra nt was ex ec ut ed butthe i m ag es thatwer e co pi ed o nt o the ha rd drives. A ssistan t U nited States A ttorn ey Re p p ert re prese nted thatthe or i gin alhar d dri ves w er e pr obab l y r e t u r n e d a n d t ha t t h e wa r r a n tl a n g u a g e a l l o ws for en sic im ag es to be m a d e. T h is re p re se n ta tio n is supp or ted bythe tes ti m ony ofLatham wh o sta ted thatthe h a r d d r i v e s s e i z e d fr o m S pe c i a l t y Outsour ci ng S ol uti ons ( “SOS” ) were re tu rn ed. Latham al so tes ti fi ed that he r ecei ved no f oren sic i m age s fro m the Se cre t S er vi ce and that no co m pu terev i dence38 N o. 08

- 3731

w as d est ro yed. The Governm ent c annot turn o ver m aterial t h a t is not i n its pos session
. A nd the h ard dri ves re turned co uld have bee n the subj ect ofsubpoena s o that they m ay have been avai l abl e from th ei ro r i g i na lo wner s se par at e an d di st i nc t fr o m the Gover nm ent. The re i s no ev i dence thatthe e- m ai l s were pri nted a nd r e t a i ne d r a the rtha n b e i ng p urg e d o rde l e t e d. There i s e vi dence, however, t hat Po rce l l iused Com pu ser ve f orhi s e - m ai li n pla ce ofor i n additi on t o usi ng the BA BC e- m ai lse rv er . I fthatwere the c ase , the e

- m ai l s would r esi de not on P or cel l i ’ s co m pu ter but o n a c entr alCom puserve co m pu ter

— and again be su bj ec t t o su b p oe n a. Fu rt h er m or e, ev en if th e e -m ails c on ta in ed e vid en c e o f a c on sp ira c y b et w ee n P or c elli and A ro nson, thi s doe s no t pr ecl ud e the poss ibi l i ty o fa c o ns pi r ac y b etwe en P o r ce l l ia nd Ki m o to
. The Cou r t qu esti o ns the r el ev an cy, a nd the r efo r e th e admi ss ibi l i ty, o fe-m ai l s i nc ul pat i ngPo r ce l l ia nd Aro ns o n i n a co ns pi r ac y c l ai m ed to b e i nde pen den t ofthe K i m oto
- Por c elli conspi ra cy. N ordoes the defen se ’ s sh o wi ngo fa c o ns pi r ac y b etween Por ce l l ia nd A ro nson, o fwh i ch Kim oto h ad no know l edge, r el i eve K im ot o of h is re sp on sib ility in t h e K im ot o-P or c e lli con sp iracy. On e nee d not kn ow all his co-con sp irators i n or der t o be guilty o f co nspir acy. Kim oto had w ri tte n scr i pts and had a his to ry as a tel em ar ket er p rior to h is m ee tin g w ith P or c elli. R. 6 6 a t 7

- 9
. Tu r ning t o the a l l e g e d l o s s o r de s t r uc t i on o f the hundreds o ftho usands ofcustom erco m pla i nts t ake n fro m SO S, th e c ou rtst at ed :N o. 08

- 3731 39

Si m i l ar l y, the c our td eterm i ne d thatthe re was no 26 d es tr u ct io n o f SO S co m p u te r li n k s: Kim ot o’ s c ouns elr epr es en t ed thathe c an ac c es s no thi ng f ro m the SO S dat a ba s e bec aus e the l i nks ar e bro ke n. H oweve r, the re i s no bas i s t o c onc l ude thatthe Gover nm en t kn e w tha tby di s c on ne c t i ngthe c omput ers i twou l d b e d ism an tling the n etw or k an d d estro y ing link s t h at co u ld notbe r ec re at ed. M r. Libby te st i fi ed thatag en t s e xe c ut i ng a sear ch w arr an t on site w ou ld no t kn ow in ad v an ce if c om put er s wer e l i nke d ac ro s s the “i nt er ne t bac kbone ” a nd c oul d notpl an f or that

. Addit i ona l l y, he te s t i fi ed thatthe agency is l im it ed b y th e sc ope of the w arrant, and a rel ation al d ata b ase co u ld no t be search e d i f it w ere n ot in the w arr an t. R
. 66 at 8. Th e r e i s no f o un da t i o n t o c o nc l ud e tha tJ a y La nk f o r d, a pri nci pal of SOS, had c opi es of severa l hu nd re d thousand com pla i nts on h and w hen the Se cre t S er vi ce sea rche d the f aci l ity. The S ecr et Se rv i ce r eco ver ed thi rty- thre e bo xes o fdocum ents fro m SOS, allo fwh i ch wer e m ade a va i l ab l e to the de fen se . Addi tionall y, the i nfo rm ati on Kim oto so ught m ay have been avai l ab le fro m ano therso urce, sinc e the S OS se rv erexchange d data o n a dai l y b asi s with A ss ail’ s s er veri n K ansas Ci t y, the o ffi c e s o fwh i c h we r e n o tr a i de d. [ 26] Acti o ns t ak enb y Ass ai la nd Kimot o hi m se l fl en d l i t t l e c r e de nc e t o the a r g ume nttha te - mai l s e xi ste d w hich w ere im p ortan t and cont ained ex cu lpato ry evid en ce. T he A ssail inform ation tec hn ology director, Cha r l es Da vi dso n, t es ti fi ed th at he des tr o y ed ba ck

- up40 N o. 08

- 3731 tapes and e- m ai l, and Cli ff or d D unn test i fi ed that e- m ai l s were pu rg ed and t h at K i m oto o rder ed hi s c o mput e rde s t r o y e d. As t o mot i ve , the Cou r t fi nds no ba d f ai th, th at i s, no “c on sc iou s e ffor t t o s u p p re ss ex c u lp at or y e vid en c e,” Jone s v. M cCaug htry , 965 F.2d 473 , 477 (7th C ir. 1992), on th e p art of th e G overn m en t w ith resp ect to K im oto’s al l ega ti ons. Even i fthe e-m ails had been prese rv ed an d wer e l o st or des tr o y ed bythe Go ve r nm en t, the C ou rt can not i nfer bad f aith bec au se th e exc ulp atory si gnifi cance ofthe e- m ai l s was notapparent, gi ven th e G ov er n m en t’s t h eo ry of th e c as e, as th or ou gh ly o ut li ne d t o Ki m o to
. . . . Tha t th e Gov ernm en t i nv e s t e d the e - mai l s wi th l i t t l e i m por t a nc e i s ma de cl ea rb y the fact tha t i n i ts e i g ht

- ho urPo wer Po i nt “r eve rs e pr offer, ” am ong the v i deo cl i ps, ve ri fi cati on re cor dings , i m age s o fsa l es sc ri pts and r efer ences to th e law ap p lica b le to th e ca se , on ly th re e e - m a i ls w er e fe at u re d . K i m ot o c h os e, p os sib ly for st ra te gic r e a son s, not to al ert the Go vern m en t to the n atu re ofthe i nfo rm ati on he w as see ki ng, w h ich was c e r t a i n l y r e a s o n ab l e a n d p r o p e r . Ho we v e r, i ts h o ws n o b ad fait h on th e p ar t o f th e G ov er n m en t t h at it f ai l ed to per c eiv e how thi s info rm ati on co uld be m at er ial a n d rele va n t t o a n y d efe n se th eo ry , eve n if su ch i nform ation h ad been i n th e G overn m en t’s po ss es si o n. R. 66 at 9- 10. The Court n ot ed that ther e were tw o add i ti onal re aso ns wh y i t s houl d not g ra n t th e m oti on t o dism i ss.N o. 08

- 3731 41 Fi rs t, M r. Kim oto had n ot so ught a continuance “ba sed up on Libby ’ s el eve nth hour re vel ati ons and the all ege d disc ove rym i sco m m unica ti on r ega rdi ng the co m pu ter fi l es th at wer e o bt aine d by th e Gov ernm en t
. . . a nd provi ded to Kim oto
. ” Id. a t 10
. Al th o ug h the Go ve r nm en t ha d a g r ee d no t to o ppo se a c o nt i nua nc e, and the cour t pr evi ousl y had ind i cate d that withhol ding ofnece ssa r y di s c o v e r y ma t e r i a l s wo u l d b e a r e a s o n f o rg r a n t i ng a co nti nuance, “Kim ot o el ecte d to f or go the o pp or tuni ty to have hi s e xpert obt ai n and re vi ew the in form ati on w hi ch he now conte nd s i s so cruci al to his d efense. ” Id. at 11 . A d d itio n ally , th e c ou rtob se rv ed th at, alth ou gh it w as re adily a pp ar en t th at f or ensi c fi l es w er e no t provi ded , M r. Kim oto di d not r eta i n Libb y unti lthr ee w ee ks befor e t ri aland did notse ek to obt ai n f or ensic im ag es unt i lt wo wee k s be f o r e th e tr i al

. The di st r i ctc o urt bel i eve d th at “Kim oto sho uld have r ai sed the probl em ofwh i ch he no w co m pla i ns m u c h e arl i erthan thre e busi ness days pr i orto the sta rto ftr i al

. ” Id. at11

- 12. The cour t s um m ar i zed i ts hol ding acco rdi ngl y: The Go ve r nm en t al l o wed o penfi l e di sco ve r y a nd sent to defe nse c ounsela 500-g igab yte har d dri ve l oaded w i th ei gh t of elev en CD s a nd DVD s, wh i ch i nc l ude d, i n the Go ve r nm en t’ s es ti m at i o n, all o fthe m at er ial th at u n d er lay its ca se . A c c or d in g t o t es tim ony b y P ost alInspectorLatham , thi rty- thre e bo xes of e vid en c e, se ize d from SO S, w er e m a d e av aila b le to K im oto ; har d dri ves sei zed fro m S OS w er e r etu r ne d. In the abs en ce o fa n a r ti cul at ed requ es t, the Gov ernm en t ha d no fur th ero bl i g at i o n.

. . .42 N o. 08

- 3731 The Court has her ei n artic u late d i ts re aso ns f ori ts A pri l16 th Orderdenyi n g K im oto ’ s M oti on t o Di smi ss ( Doc
. 4 6)
. Ki m o to f ai l ed to e st ab l i shtha t th e G o ve rn m en t in te n tio n ally w ith h eld ele c tr on ic e vidence f orthe pu rpos e o fdepri vi n g h im o fthe use ofthatev i dence duri ng hi s t ri al

. S pecificall y, Ki m o to f ai l ed to s ho w b ad f ai tho n the pa r t o fthe G overn m en t, fai led to sh ow that the ex cu lpa t o ry val ue o fthe evi dence w as apparent and fa i led to sh ow th ath e c ou ld n o t h av e o b ta in ed co m p ar ab le evi dence by othe r re aso nabl y a vai l abl e m eans. Id. at12 ( ci ti ng U nite d States v. Watts , 2 9 F.3d 287, 28 9- 90 (7th C ir. 1994)).

6 . P o s tT r i a l Mot i o ns Inh is p os t-t ria l m ot i o n f or ac q u itt al a n d a n ew tria l, M r . K im oto r en ewe d hi s ar g um en t th atthe Go ve r nme n t ’ s w i th h o l d i n ga n d / o rd e s t r u c t i o n o fe v i d e n c e i mped ed hi s abi l i ty to m ount a defense. W i th r espectto disc ove ry , M r. Kim oto al so subm i tte d that he was en titl ed to a new tri al becau se t h e “ G overn m en t’s f ail ure to p rovide any d igi tal e vide nc e and the G overn m en t’s producti on o fo nl y 4, 600 of80 0, 000 physical docum ents ta ke n from [S O S] p re ve n te d M r. K im ot o fro m ad eq u at ely p rep aring his d efense

. ” R.58 at 6 (e m p ha sis in origi na l)

. Ad di ti o na l l y, M r . Ki m o to cl ai m ed, a ne w t r i al was w arra n te d be c a u se th e G ov er n m en t fa iled to p ro vid e h im w i th exhibi ts acco m panyi ng the vi deo deposi ti on o f J am es Si er ra . These exhibi ts consi ste d o f e

- m ai l s s ent b y R oger H ow ard , a Gov ernm en t w itness , and thereforeN o. 08

- 3731 43 const i tuted m ate ri althat s houl d have be en pro du ced und erthe J encks A ct, 18 U
. S. C. § 3 500. The cour t r eco unted, atthe outse t, that i t had “ex ha us tively con side red the is s u e of th e G overn m en t’s al l eg ed f ai l ur e to pr es er ve a nd t o pr o vi de phy si ca la nd di g i ta le vi den ce i n i ts M ay8 , 2 00 8 Or derdeny i ng K im ot o’s m ot i o n to d ism iss .” R .72 at13 . Sp ec ifica lly, it re vi ew ed the tes ti m ony ofJ ay Lankfo rd, p rinci pal o f SOS, i n de t a i l, a s we l la s tha to fP o s t a lIns pe c t o rA dam Latham

. A fter thi s r evi ew , the cour t co ncl ud ed that c o mput e r s a nd h a r d dri ve s h a d b e e n s e i z e d fr o m S OS an d wer e ret ur ne d. W i thr es pec t to the do cument s, the c ou rth el d t h a t “ K im ot o’s ch ain of as se rt ion s s im p ly does not l i nk up. T h er e is no evi dence thatS OS had near l y 8 00, 000 hand w ri tte n custo m eri nquir y for m s o n its p re m ise s w h en th e fe d er al a ge n ts ex ec u te d th eir searc h w arran t or that, i f p resen t, the doc um en ts w ere a c t ua l l y sei z e d b y a g e nt s o r, i fb o th pr e s e nta nd s e i z e d, that the docum ents w er e dest ro yed. ” Id. at 14- 15. Fin all y, th e c ou rtals o ob s e r v e d th at, ba se d on L an kfo rd ’s t es tim ony, “the d oc u m ents at i ssue w er e a vai l abl e t o K i m oto on a d atab ase li nk ed to the SO S system in A ssail’ s K ansas C ity offi ces, wh i ch w er e no t r ai ded

. ” Id. at15
. F i na l l y, the c o ur t a l s o he l d tha t “ Ki mot o [ ha d] p r o v i de [ d] n o ob j ec tiv e re as on to be liev e th at th e d oc u m en ts w ou ld have been he l pfulto hi m . ” Id. Inde ed, thi s was do ubt ful b a s e d o n the t e s t i mon y p r e s e nt e d tha tMr
. Ki m oto h ad order ed the destr ucti on o ftho usands ofdocum ents, both dig i taland i n hard co py. T u rn in g t o th e a lleg ed w ith h old in g of Je n c ks m at er ial, th e di st r i ctc o ur t det er m in ed th atM r . Ki m o to ’ s ar g u-44 N o. 08

- 3731

Subs equen t l y, M r. Kim ot o fil ed a m ot i on t o r ec ons i der the 27 c ou r t ’ s de ni a l of hi s m ot i on f or a c q ui t t a l a nd f or a ne w t r i a l

. In it, he cla im ed tha t the c o u r t sh ou ld ha v e con sid ered his cl aim und er the J encks A ct, not under Brady

. Th e c ou r tdeterm ined , no ne t h e l e ss, that M r. K im oto kn ew of the exh ib its to the d ep osi t i on l ong befor e t ri al an d had m ade no e ff or tto se c u r e the m . A d d ition ally , the cou rt no ted tha t M r. K im oto had n o t e s t a b l i s h e d th a t th e e x h ib i t s we r e i n th e h a n ds o ft he p ro secuti on team and had not e st ablis hed that he had suffered a n y prej ud ic e. The court al so dete rm ined thatM r. Kim ot o’ s othe r ar gum en t s wer e withoutm er i tor wer e unt i m el y. m ent was m or e a pp ro pri ate l y c l ass i fi ed as a Bradyc l a i m. The cour t obser ved that, al thou gh M r. Kim oto had en te r ed i nt o a st ipul at ed j udg m en t wi ththe F TC a t th e ti m e S i er ra ’ s deposi ti on was ta ken, M r. D ra sko vi ch r em aine d M r . Ki m o to ’ s co uns elo fr ec o r d. Thu s, the do cum ent a l l eg ed l y withhel d w as avai l abl e t o M r. Kim oto thro ugh the exer ci se ofr eas onabl e di l i gence . 27

D. Mr . Ki mo t o ’ s Sp e c i f i c C o nt e nt i o ns 1. For ensic I m age s M r . Ki m o to fi r stmai nt ains tha t th e Gov ernm en t’ s failure to pro vi de hi m with c om ple te f or ensi c i m age s o f a l ldi g i t a le v i de nc e wi thin i t s p o s s e s s i o n c o ns t i tut e d a Bradyvi ol ati on. W e ca nnot a gr ee. Even i f w e co uld ca teg or i ze the f o r en si c i m ag es as e xc ul pat o r y o ri m pea ch i ng, the di st r i ct co ur t di d no t ab us e i ts di sc r et i o n i n d eterm i ni ng thatthe Go v e r nme ntdi d n o twi thh o l d thi s e v i de nc e. A dd i ti onal l y, ev en i fwe coul d conclu de that the Gov-N o. 08

- 3731 45

ernm en t wi thhe l d thi s ev i den ce , the di st r i ct co ur t’ s co ncl usi on

— th atM r . Ki m o to was no t pr ej udi ce d b y the Gover nm ent’ s a cti on

— was no t anabus e o fdi sc r et i o n. The re cor d i s cl earthatthe Gover nm en t m ad e bo th i ts do cument ary and d i g i ta le vi den ce a va i l ab l e to the d efe n se from th e v e r y b eg in n in g of t h is c as e. In Oct o be r2 00 7, fi ve m onths pr i o rt o t r i al, the Go ve r nm en t pr o vi ded th e defen se w ith all o fthe dig i talev i dence t hat ithad re viewed and used i n p reparation f or the reve rs e proffer

. Al th o ug h Mr. K i m o to had se ve r ali ndi vi dual s wor k i ng on the fi l es beginning i n N ove m ber20 07

— all p u rp or te d ly conve rs ant i n dig i talte chnol ogy

— these i nd i vi du al s e i ther d id n otrea lize t h a t t h ey w er e n otw or kin g w ith fore n sical l y s ound im age s o r did notco mm unica te the i m port ance of obt ain in g a for en sic ally so u n d im ag e to d efe n se co u n se l. A lte rn at ive ly, th ey info rm ed d efe n se co u n se l of th eir n ee d s , b u t n o a c tio n w as ta ke n to se c u re a for en sic ally sound i m age of the dig i talevi dence. Rega rdl ess , i t was not un tilLibb y j oined the d efense team , three w e eks before tr i al, t h at he r equeste d fo re nsi c fi l es and that the r equest was pa ss ed o n t o the Gov ernm en t. I t i s undi spu te d tha t th e Gover nm ent di d not r ecei ve a r equest f orf or ensi c fi l es unti l, atthe ear l i est, M ar ch 11, 20 08. Furtherm or e, the Gover nm ent, al though s kepti calthat th er e was a ny g enui ne c o nfus i o n abo utthe natur e o fthe d igit a l m at er ial th at h ad be en p ro vid ed to M r. K im ot o in Oct o be r2 00 7, i nf o r m ed d efense c o uns eltha t th e Gov ernm ent woul d not o pp os e a co nti nuance to al l ow L ibby an o pp or tuni ty to re vie w the dig i talev i dence. W e hav e he ld th at “[a]s long as ultim ate d isclosure is m ad e before46 N o. 08

- 3731 i t i s t oo l ate f orthe defe nd ants to m ake use o fany benefi ts of ev i dence, Due Pro cess i s s ati sfi ed. ” Un i t e d S t a t e s v. Z iperst ei n , 60 1 F
. 2d 281, 2 91 (7 th Ci r. 19 79)
. M r. Kim oto , ther ef or e, was not prej ud i ced by an y ac tio n ofthe Gover nm ent. By co n tr as t, i t was the defense’ s f ai l ure to ti m el y r equest f or ensi c fi l es and i ts conco m i tant deci si on to f or ego a re quest fo r a co nti nuance thatpre vente d M r . Ki m o to fr om b ei ngabl e to s ec ur e an d r ev i ew the fi l es i n the f or m at he so ught. Th e d i str i ct c ourt, ther ef or e, did notabus e its di scr eti on in deter m i ni ng tha t the Gover nm en t’ s a cti ons w i th r espectto f or ensi c i m age s did notco nsti tute a Bradyv i o l at i o n.

2 . Ma t e r i a l no tE x a mi ne d b yt he Go v e rnme nt Mr
. K i mo t o al s o ma i n t a i n s th a th e i s n o tr e a l l y c o mp lai nin g abou t forensic fil e s , bu t abou t the Go vern m en t’s fai lure to turn over all di g i ta le vi den ce i n a tim el y f as hi o n. S pec i fi ca l l y, M r . Ki mo t o c o n t e n d s th a tth e Go ve r nm en t m i sl ed hi m into bel i eving tha t the o ne har d dri ve provi ded to hi m i n Oct o be r20 07i nc l ude d al ldi g i ta le vi den ce i n the Gov ernm ent’s po ss es si o n. W e ca nno t ac ce pt th i s co nt en tio n . In th e lett er ac c om p an yin g th e ha rd d riv e p ro vid ed in October20 07, Pos talInspectorLatham st ate d: “Enclo sed y o u w i l lf i nd the har d dri ve wi th oure l e ct r oni c di s co ve ry f or the above r efer enced cas e. On the di sk you w i l lfin d fi ve d a t a d i r e c t o r i e s . . . . ” R
. 4 0 , At t a c h

. C ( e mph a s i s a d d e d )
. As w ell, Posta l I ns p ector L a th am sp ecifi cally inform ed M r. Ki mot o ’ s c o un s e ltha to ne o fthe di r e c t o r i e s c o nt a i ne d: audio r eco rdi ngs o fBA BC , FAL C, and A ssa i lpro gr am sa l es v er i fi ca ti o ns tha t wer e r ec o r ded byVo i ce Lo g . TheN o. 08

- 3731 47 750+fi l es i n thi s di re cto ryar e the di gi talr eco rdi ngs that w e down l oaded fro m Voi ceLog’ s s er ver

— there ares e ve r al h u n dre d t ho u s an d othe rv e r i f i c at i on s tha twe did no t review
. Id. ( emphas i s adde d)

. Thu s, a t l ea stwi thr es pec t t o the V oiceL og record in g s , i t w as read il y ap p aren t tha t the re w as si gni fi cant di gita lev i dence thatwas not i ncl ud ed on th e ha r d dr i ve . At n o t i m e di d a ny one a ffi l i at ed wi ththe pros ecuti on t eam r ep re sent that the har d dri ve produced i n Oc tobe r2 00 7 co nt aine d a l ldi g i ta le vi den ce i n the Gov ernm en t’ s po ss es si o n. F ur th er m o r e, th e r ec o r d r efl ec ts th at, i f th er e we re any ge n u in e c on fu sio n co n c er n i n g w h at w as p ro d u c ed in O c t o b e r2 0 0 7, Mr
. K i mo t o ’ s c o u n s e le i th e rb e c a me a w a r e o f, or sh ou ld h av e b ec om e a w ar e o f, th is d efici ency pri orto M ar ch 13, 20 08

— the fi rs t t i m e any di sc o ve r y r eque stwas s ubmi tt ed to the Gov ernm en t. The record refl ects that M r. K im oto ha d hired i nv estigators to re vi ew d igit alev i dence i n N ove m ber20 07. A t o ra l argu m en t, cou ns el r ep resen ted that, as M r. K im oto’s i n v e s t i g a t o r s de l v e d fu r th e ri n t o th e fi l e s , i tb e c a me “cl ear erand cl ear er ” to them that ce rt ai n dig i talev i dence, w hi ch w as thought to exi st, w as not i n the m ate ri al s that h ad been supp l i ed. A gain, however, no add i ti onal evi dence

— n o ra n y c l a r i fi c a t i o n o fwh a tth e G o v e r nm en t had produced

— w as re quested unti lthe m i dd le of M ar ch 200 8. W hen the al l ege d confusi on was brought to the Gove rnm ent’ s a tte nti on, i t a gr eed notto o pp ose a continuance.48 N o. 08

- 3731

T h e d ist ri ct co u rt o b se rv ed th a t itco u ld n o t “ re ca ll a t im e . . . 28 w he n it d id no t gra nt a con tinu an ce w he re, as here , it would h ave b een r eques t ed by the defen s e and the Gover nm ent indicat ed itw ould no t obj ect
. ” R.66 at11. U n d er t h es e c irc u m st an c es , t h e d ist ric t c ou rt ’s d et er m inati on that the Governm ent’ s a cti ons did notco n st i tute a Bradyv i o l at i o n c er ta i nl y was no t anabus e o fdi sc r et i o n. A ga in, ass u m in g t h e e x ist en c e o f so m e e x c u lp at or y e vidence so m ew h er e in the di gi talm ate ri al s no t r evi ew ed by the Gove rnm ent, the defe nse was pro vi ded th ese m ate ri al s pri orto tr i aland w i th an offernotto o pp ose a mo t i o n t o c o nt i nu e . In s um , the p r o du c t i o n wa s ma de “befor e i t [ w a] s t oo l ate f orthe defe nd ants to m ake use ofany benefi ts ofev i dence. ” Stott, 24 5 F
. 3d at 901 (i nt erna l qu otation m arks om itted ). M or eov er, ev en as sum i ng tha t e xculpatory m ate ri al was wi th h e l d , we h a v e s t a t e d th a t, wh e n a d e fen dan t r e a l i z e s tha te xc ul pa t o r y e v i de nc e h a s b e e n wi thh e l d, th e “ ap p ro p r i at e c ou rs e” is to se ek a c on tin u an c e if “m or e t i m e t o i n vest i gat e the excul pator y pot enti alo f th e e v id en c e” is n ee d ed

. U nited Sta tes v. G rintjes , 23 7 F. 3d 876, 880 ( 7th Ci r. 20 01)
. H er e, the defe nse r eal i zed be f o r e tr i altha t i t ha d m i su nde r st o o d what th e Gov ernm ent had co pie d onto the har d dri ve . T he Governm ent, base d on thi s m i sund er sta nd i ng, ag re ed not to oppose a co nt i nua nc e. Thu s, a ny pr ej udi ce t o the de fen dan t 28 w as not the pr oduct ofthe Gover nm ent’ s a cti on, but of M r. Kim oto ’ s co nsci ous dec isio n to f or ego a m oti on t o continue and to fi l e instea d a m oti on t o dism i ss.N o. 08

- 3731 49 I n additi on t o hi s g ener al cl ai m thatther e m ust hav e been som e, u ni denti fi ed, exculpato ryev i dence am ong that w i thhel d, M r. Kim oto i denti fi es tw o speci fi c pi eces o f evi dence, wh i ch w er e no t di sclose d to hi m pri orto tr i al and w hi ch, he b el i eve s, i m peded hi s abi l i ty to m ount a defen se . The fi r sti nc l ud es ho m o se xua lpo r no g r aph y sto re d on C l i ff or d D unn’s c om pu ter
. M r. Kim oto a l l e g e s th a t“ [ t ] h i s r e v e l a t i o n th a tD u n n h a d s o me thi ng ofhi s o w n to hi de on hi s co m pu terwould have provi ded an a l ternati ve expla nati on f or del eti ons of data that D u n n at tr ibu t e d t o K im ot o.” A p p ella n t’s B r. 38 . Th is m ate ri al, h ow ev er, was not w i thhel d fr om the defe nse, b utwa s l o c a t e d a tthe F a i r v i e w Hei gh t s f a c i l i t y a nd , ther ef or e, ava i l abl e t o the defense at a n y t i m e. H ad M r . Ki mot o s o ught a c o nt i nu a nc e , i t wo ul d ha v e be en av ai l ab l e f o rthe de fen se t o us e att r ial

. T hu s, a g ain, a n y p r ej u d i c e t o Mr
. Ki mo t o r e s u l t e d fr o m hi s o wn failu re to rev iew th e d igit al in for m at ion in a tim ely fashion a nd t o s ee kthe c o ur t’ s as si st an ce whenhe r ea l i ze d tha t t her e ha d b ee n a mis unde r st an di ng w i t h r e s p ec t t o th e e x te n t o f th e d igit al e vid en c e in h is po ss es si o n. M r. K im ot o a lso refe re n c es e-m ails be tw ee n P or c elli and A ro nson that e vi denc e a conspi ra cy between tho se tw o, witho ut di re ct r efer ence to M r. Kim oto. M r. Kim oto cl ai m s th atno t o nl y w as he de pr i ve d o fthe i m pea ch

m ent v al ue pro vi ded bythese tw o e- m ai l s, but surm i ses th at, to th e ext en t tha t Porce ll i’ s othe r e -m a ils “w ere c on sist ent with the l i ttl e we know about the e m ai l s that w er e p r o du c e d, the y c o ul d o nly h a v e s e r v e d t o b o l s ter K i m oto ’ s ca se and und er m i ne the Gover nm ent’ s. ” Id. at38

-50 N o. 08

- 3731 39
. Af te rthe he ar i ngo n the mot i o n t o di smi ss , the di s t r i c t c o ur t f o un d tha t the r e wa s no e v i de nc e to s up portM r. Kim oto ’ s co n c lu sio n that the Gove rnm ent had obt ai ned the e

- m ai l s r efer enced i n t he r eve rs e pr offer fro m a B A B C d at ab as e. SeeR .66 at 8. T h e c ou rtsp ec ifica lly note d that there w as ev i dence thatPor cel l iused Com p u serve “f orhi s e - m ai li n pla ce o fo r i n additi on to usi ng the BA BC e- m ai lse rv er . ” Id. Fur ther m or e, gi ven th e r efer en ce t o , a nd d iscus si o n o f, the e - m ai l s i n the reve rs e pr offer, i t har dlycan be a rgued that the Gover nm ent withhel d thi s e vi dence fr om M r. Kim oto
. M r. K im oto s i m plyas sum ed that the e

- m ai l s use d by the Gove rnm ent e xi ste d i n dig i talf or m and , wh en the y c ou ld n otbe loc at ed , ne ve rre q ue s t e d the e

- m ai l s fro m th e G o v e r n me n ti n a n y o th e rf o r m. W e o nl y a dd thatw e, like the dist ri ct c ourt, ar e a t a l oss t o see how M r. Kim oto was prej ud i ced by any a cti on ofthe Gover nm ent. A t s om e point prior t o the c ro ssexam i natio n ofPor cel l i, the defe nse t eam ei therwas provi ded with har d copi es ofthe e-m ails orl oca ted the har d copi es ofthe e- m ai l s a m ong the docum ents i n i t s p o s s e s s i o n . Mr
. K i mo t o ’ s c o u n s e lth e n c r o s s - e x a mi ned Porcell iexte nsi vel y o n the conte nts o fthes e e - m ai l s. SeeTr. I I Iat 161-75. Clearly, therefore, th e d isclosure was made i n t i m e f o rM r . Ki m o to to m ake use o fthe ev id en c e a t t ria l. SeeStott, 24 5 F
. 3d at 901. Give n that M r. K i m oto w as abl e to use these “m issing” e- m ai l s in hi s cr oss - exam i nati on o fPor cel l i, t h e crux o f M r. Kim oto ’ s a rgum ent a pp ear s t o be th at, had he be en ab le t o a c c es s t h e fu ll com p lem en t o f P or c elli’s e-m ail,N o. 08

- 3731 51

Finall y, M r. K im oto m akes a s eparate argum ent, dev el oped 29 ful l y on l y i n h i s r epl y, thatthe re pos s ibl y was othe r di gi t al an d d ocu m en tary ev id en ce w hich ha d no t be en m ad e av ailab le to th e d efe n se p ri o r t o tr ia l. S eeRepl y B r. 8. His be l i efi s bas ed o n his post- tr ial revi ew ofthe digit al and docum en tar y evidence tha t the G ov ern m e n t pr ov id ed to him p rior to trial. Th is arg u m en t w as no t raised b efore the d istrict cou r t u n til M r. Kim ot o fi l ed “ Defen dant ’ s M ot i on t o Rec ons i der M ot i on f or a J udgm en t o f A c qui t t al an d M ot i on f or a N ew Tr i al, ” o n Augus t12 , 20 08
. The di s t ri c tc our tbe l i eve d thi s ar gum en t w as an attem p t to circu m v en t the req u ir e m en t, set f or th in Fe der al Rul e ofCrim ina l Pr oc edur e 33 ( b) ( 2) , thatm ot i ons f or a n ew t ri al be fi l ed wi thi n s eve n day s . The c our tha d a s ound basis f or that vie w . W e wo uld ad d that M r. K im oto b ears the resp on sibility f or his ow n failu re to secu re co m p lete d iscovery and to revie w thoroughly th a t m ater ial

. Itw as M r. Kim ot o’ s dec i s i on

— or that o fhis counsel

— t o c om m en c e the revie w ofthe ex tens ive docum en tary and digit al evidence on ly a few week s befor e t ri al

. I t al s o was hi s dec i s i on to foreg o a m otio n to con tinu e tha t w ou ld ha v e a l l ow ed his defen s e t ea m addi t i ona l t i m e t o r evi ew an d under s t and the or i gi naldi gi t al e vi denc e s en tt o Libby on M ar c h 2 8, 20 08
. The d istrict cou rt cor rectly d eterm ined th a t it w as the se d ecision s, rather than any G ov ernm ent att em pts at s ub ter fuge, that has r es ul t ed i n a ny pr ej udi c e t o M r. Kim ot o. M r. Kim oto would have disc ove re d evi dence ofev en greater im p each m en t value to u se d uring tri al. H o w ever, as note d by the G ov ernm ent, thi s invol ves a s er i es of a s s u m p t i o n s t o o w e a k t o s u p p o r t a d u e p r o c e s s c l a i m. See sup ra pp . 33-34 (qu oting R
. 40 at 13). 2952 N o. 08

- 3731 3 . C us t o me rSe rv i c e Re c o r ds M r. Kim ot o m ai ntai ns thathund re ds oftho usands of custo m erse rvice c om pla i nts s ei zed fro m S OS w er e l ost ordestr oye d by t h e G ove rnm ent. M r. Kim oto further subm i ts t h at these r eco rds were m ate ri albec ause they w er e “ [ c] entr al ” t o hi s theor y that “ the g re at m aj ority of the c us t o mers e r v i c e c a l l s r e c e i ved by S OS a nd BAB C w er e no t c om pla i nts b y c onsum er s cl ai m i ng to have been m i sl ed in to b eli eving tha t they woul d rec ei ve a c re d it c ar d .” A p p e l l an t’s B r. 33 . M r. K im ot o a c kn ow led ges th at 6,366 SO S c u s tom er i nq uiry record s w ere i nc l ud e d in the Go ver nme nt ’ s do c ume nt s a nd ma de avai l abl e to h im and thathe was ab l e t o est abl i sh that, o f thos e 6 , 366 re cor ds, “o nl y 2 2 i denti fi ed that the c al l er had com pla i ned that he be l i eve d the pro du ct to be a cre ditcar d.” Id. at 34. N eve rthel ess , he c l ai m s “ [ c] om ple te ac ce ss t o the da taba se woul d ha ve perm i tt ed th i s po i nt to be m ade with c onsi derably m or e for ce. ” Id. at35
. W e a g r e e w i th th e d i s t r i c tc o u r tth a t, u n d e rth e c i r c u mst an ces prese nted her e, the a lleged l oss o r destr ucti on o f docum ents by the Gove rnm en t d oe s no t co nsti tute a d ue proc ess violati on. Fi rst, w e not e tha t the district cou rt f ound th a t, a s a thr e s ho l d ma t t e r, Mr
. Ki mot o di d n ot es tabl i shtha t th e Gov ernm en t des tr o y ed o rl o stthe d oc u m en ts in q u es tio n . See sup ra pp. 38- 39. M r. Kim oto a s s e r t s that “[t ] he r e c a n b e n o do ub ttha tthe s e r e c o r ds ex isted and w ere seized

. ” A p p ell a nt ’s Br. 33. H ow ever, he has not poi nted to t h e tes ti m ony ofany w i tness w h ich cal l s into questi on the di str i ct c ourt ’ s co ncl usi on th a tth e r e i s n o e v i d e n c e th a t8 0 0 , 0 0 0 c u s t o me rc o m-N o. 08

- 3731 53 pl aint s ex i st ed i n h ar d c o py atthe t i m e th e Gov ernm en t r ai ded S OS o ffi ce s o rtha t, i fthe y di d e xi st, the Go ve r nm en t a c tu ally t o o k p os se ss ion of th em . SeeR. 72 at 14. Furtherm or e, as sum i ng bo th the exi ste nce and destr ucti o n ( a nd / o r l o s s ) o f the do c ume nt s , M r . Ki mot o ha s not est abl i shed that“the ev i dence w as ofsuch a natur e that [ he] w ou l d be unabl e t o obt ain com parabl e e vi dence by othe r re aso nabl y a vai l abl e m eans. ” H ub anks , 39 2 F
. 3d at 9 3 1
. T he r e we r e o v e rs i x tho us a nd c us t o merr e c o r ds fr o m S OS tha t wer e i n the Go ve r nm en t’ s po ss es si o n a nd w er e turned ov erto M r. Kim oto
. M r. Kim oto co n c ed es that the docum ents w er e a vai l abl e t o h i m and that th ey p rovide d h im a b asis forarguing that cus tom ers w er e no t con fused as to w hat they were purchasing. S pec i fi ca l l y, M r . Ki m o to ’ s co uns els ta te d dur i ngc l o sing ar gum ent: N o w the r e ha [ s] b ee n a l o t o ft es ti m o ny c o nc erning com pla i nts and the nature of the com pla i nts.
. . . M emor i es c hang e, e spe ci al l y whenthe y a r e be i ng p re ss ed . D oc u m en ts d on ’t. T h e c om p lain ts are in b l a c ka n d wh i t e . They do n ’ tc h a n g e th e i rs t o r i e s . As y o u r e c a l l, th e r e i s [ s i c ] a p p r o x i ma t e l y 6 , 4 0 0 o fth e m. Of that 6 ,40 0, ther e were onl y 2 2 co m pla i nts fro m p eo p le say i ng tha t they thought they were ge tting a cre dit car d. That i s l ess than one hal f of one p er cent. That happens. There i s [ si c] o ccasi onally bad a gents that ar e o n the phone and getaway with i t. Tr. I X at 55. H er e, the Gover nm ent’ s all ege d l oss o r destr ucti on o fS OS custo m erse rvi ce r eco rds di d not p r e v en t M r. K im oto from arguing that cons um ers54 N o. 08

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Mr
. Ki mot o a l s o ma i n t a i n s th a tth e Go v e r n me n tu s e d th e S OS 30 c us t om ers er vi c e re c or ds ats en t en c i ng t o c al c ul at e the loss f or w h ic h M r. K im o to w a s re sp o n sib le

. S eeAp p e l l a n t ’ s B r . 3 6
. He con ten d s that th e G ov ern m en t’ s u se o f the se d ocu m en ts no t on ly es t abl i s he s thatthe Gover nm en thas be endi s i nge nuous abo ut the i r ex i s t en c e, butthe us e ofthe d oc um en t s ats en t en c i ng const itutes a s eparate Brady vi ol at i on. The Gover nm en tdi d not em ploy any cus tom er se rvice rec ords du ri ng sent enci ng. Postal I ns pec t or Latham t es t i fi ed thathe us ed a dat abas e of id en tifiab le v ictim s t h a t h ad b een com p iled b y the F T C ; this d ata b ase co nta ined on ly th e na m es a n d a d d resses of victim s. Th e s ou r c e s f orthe database do no ta ppe a r i n the r e c or d; how ever, given thatthe database on ly c o ntai ns vic ti m nam es and a ddre s s es , i tc oul d have b een the Voic eLogr ec or di ngs o r in fo rm a tio n p ro v id ed b y G lo b a l e -T el ec o m , seeSent. T r. at 35- 36 , both o fw hi c h w er e ava i l abl e t o th e defen s e. Pos t al I ns pec t or L ath am also testified tha t, to co m p ose a si m i l a r d ata b ase f or BABC

- re l at ed vi c t i m s , he us ed a d atabas e re c ove re d f ro m on e of A ssail’ s com p u ters; aga in , this infor m atio n w as av ailable t o the de fen se. M oreover, al l ofthi s inf orm ati on w as en t er ed a s e vi denc e atthe s en t en c i ng h ea ri ng w i t houtobjec t i on b y th e d efe n se . S eeSe n t. T r. a t 4 1
. There i s one add it ional cl aim conce rning the cust om er serv ice rec o r d s tha t M r. K im oto m en tion s on ly in p assing in h is briefs be fore u s, b u t w hich he p u rsu ed m or e tho ro u g hly b efo re th e d istrict cou rt: W he n ex ecu ting search w arr an ts, G ov e r n m en t ag en ts de stroy ed com p u ter link s be tw een A ssail and SO S, renderi ng digi tal evidence st ored at SOS inacc es sible. (co n tin u ed ...) w er e n otco n fu se d by th e s a l e s p itc h ; his p oin t s im p ly c ou ld have b een m ade with “ m or e for ce” had the ad d it i o n a ld o c u me n t s b e e n a v a i l ab l e t o h i m. 30N o. 08

- 3731 55

(
. . . c on t i nu e d) 30 A s se t fo rt h p re v io u sly , see su pra note 26, the dist ri ctcourt concl ud ed th a t L ibby ’ s tes ti m ony est ablis hed that there w as no i nt en t i ona l des t ru c t i on ofevi denc e by the Gover nm en tan d tha tthe m ann eri n whi c h the Gover nm en tc onduc t ed i ts s e a r c h e s d i d n o te v i d e n c e b a d f a i th

. T h e d i s t r i c tc o u r te mp loy ed the c or rect stan d ard in rev iew ing M r. K im oto ’ s claim a n d s u p p o r t e d it s f i n d i n g w i th e v i d e n c e fr o m M r . K i m o t o ’s ow n expert
. It s hold in g on this i ss ue, the ref ore, w as not an a b u se o f d isc re tio n . I n sum , we agr ee w i th the di str i ct c ourtthat M r. Kim oto ha s f ai l ed to s ho w ei th erthat th e Gov ernm en t d es tr oy ed an y SO S d oc u m en ts or th at oth er co m p ar ab le docum ents w er e no t a vai l abl e to hi m . The di str i ct c ourt, ther ef or e, di d not abuse i ts disc re ti on in deter m i ni ng tha t th ere w ere no violati ons of Bradyor Yo u n g b l o od with re sp ec t t o th e SO S c u st om er co m p lain ts
.
4. H ow ard’s E -m ail M r . Ki m o to n ex t su bmi ts tha t he was pr ej udi ce d b y the Governm en t’ s f ai l ur e to tur n o ve re - m ai l s r efer en ce d i n a deposi ti on o fJ am es Si er ra . S ier ra and H oward w er e co own e r s o f Ape x, a c o mpa ny tha t s up pl i e d de b i t c a r ds to A ssa i l

. In Si er ra ’ s deposition in the FTC acti on, to wh i ch M r . Ki m o to i ni ti al l y w as a pa r ty, c o uns elf o rthe F TC r e fe r e n c e d s e v e r a l e - ma i l s s e n to rr e c e i v e d b y e mp loyees of A p ex . On e of th ose e-m ail s w as from H ow ard ’s e- m ai lacc ou n t and stat ed that “no fulfi l l m ent i s par am ount [ si c] to wir e fra ud

. ” R. 154, Ex. 3 at 143- 44.56 N o. 08

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T he reco rd d oe s no t r eflect w he n the tr an scrip t of the d ep osi- 31 ti on w as turned ov er t o the defe nse. T h e c o u r ti n i t i a l l y c h a r a c t e r i z e d Mr
. Ki mot o ’ s a r g um en t 32 concer ning the H ow ard e- m ail as m ore ap prop ri atel y analyzed und er B ra dy

. H ow ev er, M r. K im oto arg u ed in his m otio n to r e c on s i de r that the c ou r ts ho ul d h a ve c on s i de r e d thi s t o be a Jenck s A ct claim

. T h e d i str ict cou rt d id so, bu t sim ilarly rejected the a rg u m en t. The Gover nm ent produced the Si er ra deposi tion to M r . Ki mot o b e f o r e t r i a l

. S i e r r a wa s no t c a l l ed as a 31 wi tne s s , b ut, wh e n the Go v e r nme ntc a l l e d Ho wa r d, M r . Ki mo t o ’ s c o u n s e l o bj e c t e d o n th e g r o u n d tha t th e e-m ail, r efer enced abo ve, was not provi ded as r equi re d by th e J encks A ct. The di str i ct c ourto ver rul ed the obj ectio n. W hen the i ssue w as ra i sed i n subsequent fi l i ngs wi ththe cou rt, the c o ur t addr es se d M r . Ki m o to ’ s wi th

ho l di ngc l a i m un der b o th the J e nc k s Ac ta nd Brady . 32 T h e cou rt d et er m in ed th at th e d oc u m en t w as av aila b le to M r. K im oto throu gh ot h e r m ean s and that M r. Ki m o to s uffer ed no pr ej udi ce a s a r es ul t o fa ny wi th

hol ding. On a ppea l, the Go ve r nm en t arg ue s, i nt era l i a, tha t th e e- m ai lati ssue i s no t a s tat em ent withi n the J encks A ct. W e a gr ee. The J encks A ct defi nes s tat em ent a s fol l ows: (e) T he term “state m en t”, as used i n su bsec tions (b), ( c) , and ( d) o fthi s s ecti on in re l ati on t o any witness called by th e U nited States, m ean s-- ( 1) a w ritten st at ementmade bys ai d wi tn es s an d s i g n e d o ro th e r wi s e a d o p t e d o ra p p r o v e d b y h i m;N o. 08

- 3731 57

A l th o u g h n o ts p e l l e d o u ti n a n y d e t a i l , Mr
. K i mo t o p r e s u m- 33 ably is arguin g thatH ow ard’ s e- m ail s f all w ithin s ub se ctio n (e)(1 ). ( 2) a ste nogr aphic, m echani cal, el ectr i cal, o r othe r re cor ding, o r a t ra nscri pti on there of, wh i ch i s a substa nti al l y ve rba ti m r eci talo fan o ra lst ate
me n tma d e b y s a i d w i tn e s s a n d r e c o r d e d c o n t e mpora neousl y w ith the m aking o fsuch o ra lst ate
m ent; o r (3) a s t atem en t, how ever take n or record ed , or a tr anscr i pti on ther eof, i f any, m ade by sai d w i tness to a g ra nd j ury. 18 U. S
. C. § 3 50 0( e)
. In U nited Sta tes v. So ph er, 36 2 F
. 2d 33 52 3 ( 7th Ci r . 1 96 6) , we fur th erha ve e xpl aine d thatthe ter m “s tat em ent” as used i n § 3 500( e) r efer s t o a r eco rded re cita l ofpast occur re nces m ade bya p rosp ective p rosecu tion w itness
. From i ts very nature , nece ssa ri l y i t i s m ad e a ftertho se eve nts have taken pl ace. I fa pros ecuto r, i n re l i ance o n the s tat em ent, uses as a w i tness the m aker th er eo fa s a par t o fthe g o ve r nm en t’ s ca se , the sta tem ent m us t b e produced fo r the use o f d efe n se co u n se l. Id. a t5 2 5
. T h u s , i n So ph er, we hel d that the J encks A ct di d not requi r e th e Gov ernm en t to tur n o ve rthe tr an sc r i pt o fa c o nv er sa ti o n, r ec o r ded bya c oop er at i ng w itn es s, d u rin g w h ich th e d efe n d an t a c c ep te d a b rib e. In c on t r a st to a w itn es s’s rec olle c tio n of p as t e ve n ts , So ph er i nvol ved “a concurr ent t ape r eco rdi ng o fa conve rs ati on58 N o. 08

- 3731 between the payerand the re c ip ient ofan a l l ege d cash br ibe , ” whi ch“ [ w a] s o bv i o us l y o fc o nt empor an eo us sounds. ” Id. We c o nt i nu e d: The re sul t i s a pre ser vati on o fa c on ve rs ati on j ust a s i t was s po k en . I t i s di r ec t ev ide nc e r el ev an t o n the iss u e o f th e a lleg ed gu ilt o f th e d efe n d an ts on tria l. M ade wh en the al l ege dlyexto rt ed br ibe m oneywas be i ngpa i d, the t ape r ec o r di ngi n th is c as e i s o fthe actual vo i c e s o fthe b r ib e ra nd the b r ib e e . I ti s the r ef or e not a reci talof a past occurr ence by a pro specti ve w i tness and i s not withi n the gener alpurvi ew o f § 3 500. Id. ; see also U ni t e d S t at e s v. Sk i l l m an , 4 42 F
. 2d 542, 55 3- 54 ( 8th Ci r . 1 97 1) ( sa m e)
. M r . Ki m o to do es notse ekto di st i ng ui sh So ph er, no r do es he o ffer an y au th o r ity sug g es ting a di ffer ent defi ni ti on o f“s tat em ent” shoul d app l y. W e a g r ee wi ththe di st r i ctc o ur t th atM r . Ki m o to ’s c l a i m w i th r e s p e c tt o th e H o wa r d e - ma i l s i s b e t t e ra dd ressed un d er Brady . Ho we v e r, e v e n un de rthi s a pp ro ac h, M r. K im ot o’s cla im fare s n o b e tt er . First, in the dis tr i ct c ourt, M r. Kim oto expl i ci tl y di scl ai m ed an y r el i an ce o n Bradyas the ba sis for s e e k in g H ow ard ’s e-m ails

. SeeR. 88 a t 11 ( “T he Co ur t w rongly cl as si fi ed th e dem and fo r em ai l s a s a Bradyi ss ue a s o ppo se d t o o ne r a i s i ngr i g ht s g ua r a nt e e d b y the J e nc k s Ac t
. ”)
. S e c o nd , eve n i fw e lo ok to the m er i ts ofM r. Kim oto ’ s Bradyc l a i m, i t m us tf a i lb e c a us e Ho wa r d’ s e - mai l s we r e n e i the r “s up p ress ed” no r“ m at er i al

. ” I n Ie nc o v. Angarone, 42 9 F. 3d 680, 68 3 ( 7th Ci r. 20 05) , w e e xplained that “[ e] vi denceN o. 08

- 3731 59 is ‘ su p p ressed ’ for Bradypur po se s wh en (1) the pr o se cuti o n f ai l ed to di scl o se the e vi den ce i n t i m e f o rthe de fen dant to m ake use ofi t, an d (2) the e vi dence w as not o th er wi se a va i l ab l e to the de fen dan t th r o ug h the ex er c ise of re as on ab le d ilige n c e.” M r. Kim oto a rgues that the deposi ti on was not avai l abl e t o hi m bec ause he “had se ttl ed the FTC l i ti gat i on m onths bef or e the S i er ra deposi ti on was ta ken, w[as] not pres e ntf o rthe de po s i t i o n, a nd n e v e rr e c e i v e d tha tdi scove ry. ” Re p ly B r. 12. N oth ing in th is stat em en t, how ever, d isp els th e n ot io n t h at, in th e e x er c ise of re as on ab le di l i g en ce , M r . Kim o to c o ul d ha ve o bt aine d the do cum ent. H e d oe s not cl ai m thathe di d not r ecei ve noti ce ofthe Si er ra d eposi ti on, n ord oes h e cl ai m that he w as not m oni tor i ng the FTC li ti gat i on o r that he co uld nothave procur ed the docum ents fro m hi s co - defe nd ants i n that a c t i o n . In d e e d , a l th o u g h Mr
. Ki mo t o h a d e n t e r e d the s t i pu l a t e d j ud g men tb y the t i me tha tS i er ra w a s de po s e d, th at j ud gm en t ant ici p ated M r. K im oto’s cont inu ed coop erati on with the cour t- appoint ed re cei verand prov i ded f or th e co ur t’ s r et ention o fj ur i sdi ct i o n fo rpur po se s o fc o nstr ucti on, m odi fi cati on a nd enf or cem ent o fthe j ud gm en t. T he c o ur t r ec o r ds r efl ec t th at, l o nga fte rthe s ti pul a t e d j ud g men twa s e nt e r e d, Mr
. Ki mot o wa s de po sed i n the FTC acti on a nd al so l i ti gat ed the FTC’s m ot ion to l i ft th e pr ev ious l y s us pen ded po r ti o n o fthe j udg m en t ag ains t hi m . Gi ve n Mr. Ki m o to ’ s co nt i nue d i nv o l ve m en t i n the FTC acti on a t the ti m e that S i er ra ’ s deposition w as ta ke n , w e b elie ve th at th e d ep os itio n w as av aila b le to hi m i n the exer ci se ofr eas onabl e di l i gence .60 N o. 08

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Eve n i fwe h a d de ter m i ne d tha tthe Go ve r nme nth a d s up 34 pr e s s e d the Po r c e l l i e - m a i l s a nd the S OS r e c or ds , the c umul a t i ve effec tofthi s e vi denc e wo u ld n ot have r i s ent o the l eve l of Bradym a te ri a lit y . Kyle s v. Whit l ey, 51 4 U .S. 4 1 9 , 43 6 -3 7(19 9 5 ). T h ere w as subst anti al tes ti m onial and d ocum entar y evidence t o establ i s h thatM r. Kim ot o was i ns t ru m en t al i n m ar ke t i ng d eb it card s in a d ecep tiv e m an ne r, did so w ith an inten t to d eceiv e, and joined w ith o the rs to acc om p lish his g oa ls. Fi nal l y, we cannot concl ud e th at t h e o ne e- m ai lat tr ibu t ed to H ow ard w as “m aterial” for Brady p u r p o s e s. The Suprem e Cour t has e xplained that evi dence i s m ate ri al for p urp oses of Brady“i fther e i s a r eas onabl e pr obab i l i ty th at, ha d the e vi den ce b ee n di sc l o se d t o the de fense, the re su lt of t h e p ro c ee d in g w ou ld h av e b ee n d iffer e n t .” St r i ck l e rv. Gr e e ne, 52 7 U
. S. 263, 280 (19 99) ( i nter nalquotati o ns mar k s an d c i ta ti o ns o m i tted)

. In thi s ca se , the d efe n se ex te n siv ely cr os s - ex am in ed H ow ar d on h is acti ons, hi s r el ati onship w i th A ssa i land M r. Kim oto , a nd h i s c r i mi na lb a c k g r o un d. Gi v e n tha tthe j ur y a l r e a dy w as aw ar e o fH oward’s cri m i nalhi sto ry, w e d o not be l i ev e th ata n e- m ai ls ug g es tingtha t he was e ng ag i ng i n acti on s tantam ount t o w i re fra ud would have affecte d the j ury’ s deci si on t o accept orr ej ect hi s t est i m ony. 34 I n su m , w e d o n ot believe th at an y of th e d istri ct cou rt’s r ul i ng s o n the a l l e g e d Brady, Youngb l oodo r J encks A ct vi ol ati ons const i tutes an abuse o fdi scr eti on. T h er e was no e rr or, ther ef or e, i n denyin g M r. Kim oto ’ s m oti on t o dism i ss, m oti on f ora ne w tr i aland m oti on t o re consi der on those bas es.N o. 08

- 3731 61 IV S E NT E NC I NG M r. Kim oto chal l enges two as pects ofhi s s entencing: the e nhancem ent f or the l oss cal cul ati on a nd the enhancem ent for the num ber of vi cti m s. A ccor ding to M r. Kim oto , “[a ] fin d in g th at an y cu st om er su ffer ed a loss t h a t c ou ld be incl ud ed und er§ 2b1. 1 depends on wh etherthe custom erpa id m oney ‘ as a r esul t o f’ a m i sta ken b el i ef cau sed by the de fend an t’s m isreprese ntation.” A p p ell an t’s B r . 4 9
. B e c a u s e , c o n t i n u e s Mr
. K i mo t o , atl e a s ts o me c u st om er s u n d er st oo d th at th ey w er e r e c eiv in g a d eb it card , as o p p o s e d to a credit card , the d istri ct cou rt’s c al c u lat ion, w h ich as su m ed th at all in d ivid u als w h o p aid th e fee wer e vi ct i m s, g r ea tly o veres ti m at ed bo ththe num bero fvi cti m s a s wel las the tot all oss . The Gover nm ent counter s that l oss , f orpurposes o f § 2 B 1 .1 , i s t h e “ gr ea te r of a c tu al los s o r in te n d ed loss .” U
. S. S. G. § 2B1. 1 cm t. n. 3( A )
. Fur ther m or e, the appli cati on note s cl ear l y r equi re the dist ri ct c ourto n ly to “m ake a re as on ab le e st im at e of th e los s” ba se d u p on th e “ av aila b le evi dence. ” Id. atn .3(C ). B ec au se th e d ist ric t c ou rt ’s e st im ate o factual l oss i s m uch l ess than th e in tended l oss , continues the Governm ent, any er ro r i n the calc ula ti on ofactual l oss i s har m l ess . M r. Kim oto acknow l edges that in tended l oss i s a n al te r na ti ve meth o d o fc al cul at i ngl o ss f o rpur po se s o fthe Gui del i ne s. H ow eve r, he mai nt ains tha t, e ve n i fthe dist ri ct c ourthad adopted an “i ntended l oss ” rat i onal e, as opposed to an a ctuall oss pro posed by the Gove rnm ent, the Gove rnm ent s ti l lhad to establ i sh that M r. “Kim oto had62 N o. 08

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A p p lication no te 3 p ro v id es in relev an t pa rt: 35 3. L oss U nd er Su b sec tion ( b )( 1).

-- T his ap p lication no te

a ppl i e s t o the de t e r m i na ti ono fl os s un de r s ub

- (co n tin u ed ...) in te n d ed to ca u se th e los s t h e D ist ric t C ou rtu se d in i ts Gu i del i nes c al cul ati ons. ” Repl y Br. 23
. W e r evi ew a tr i alco urt’ s ca l cul ati on o fthe l oss cause d by d efend an t’s fr a u d ulen t con d uc t for clear error. U ni t e d S t at e s v. Pe t e rs on- Knox , 471 F.3d 816 , 8 21-22 (7th Cir. 2006 )
. A defendant ch all engi ng a dist ri ct c ourt ’ s l oss c alc u l a t i on m u st n oton ly d em on st ra te th at it is in ac c u ra t e , b u t a lso “o u ts id e t h e re alm of p er m iss ible com pu tat i ons. ” Id. a t8 2 2
. In c o n d u c t i n go u rr e v i e w, we turn fi rs t t o the a pp l i cabl e guidelin e and the di str i ct c ou rt ’s a p p lica tio n of th at gu id elin e t o M r. K im ot o.

A . Dist r i ctCourt ’ s Gu i deli ne Calc ulat i on Section 2B 1.1 is th e guid eli ne ap p li cab le to M r. K im oto’s offenses . S ec tio n 2B1. 1 instr ucts the di str i ct c ourtto use a base o ffense l eve land to i ncre ase the offense l eve l acco rdi ng to the am ount o f“l oss . ” Ap pli cati on not e 3 gi ves furtheri nstr ucti on o n how to cal cul ate “l oss ” for pu rpos es ofthatgui del i n e; it stat es that the “ gener al rule ” is that “l oss i s the gr eat ero factual o r i ntended l oss . ” U.S
. S. G. § 2B 1.1 cm t. n. 3( A )
. I t furtherpro vi des th at “a c t u a l loss ” is “t h e re as on ab ly for es ee ab le pec uni ary ha r m tha t resu lt ed fr o m the o ffen se ” an d “i ntended lo ss” i s the “pecun iar y harm thatwas i ntended to re sul t fro m the offense. ” Id. at n.3(A )( i) & ( ii ). 35N o. 08

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(
. . . c on t i nu e d) 35 se ct io n (b )(1).

(A) G en era l R u le.- -Sub ject to the exclu sion s in sub d iv is i on ( D) , l os s i s the gr ea t er o fac t ual l os s or i nten d ed loss. ( i ) Actual Los s . - - “Ac t ual l os s ” m ea ns the r ea s onably f ores eeable pecuniary harm thatres ulte d f rom the offense . ( i i ) I nt en ded Los s . - -“Inte nded l os s ” ( I ) m ea ns the p ecu nia ry ha rm t h a t w as inten d ed to resu lt f rom the offense; and (I I) i ncludes i ntended p ec u n i a r y h a r m th a tw o u l d h a v e b e e n im p o ssibl e or unl i ke l y t o occur( e. g. , as i n a gove rn m en t sting op era tion , or an insu ran ce frau d in w h ic h th e c la im ex ce ed ed th e i n su re d v a lu e). ( i i i ) Pe c uni ar y Harm
. - - “Pe c uni ar y ha rm ” m ea ns ha rm tha t is m on etar y or th at o th e r w i se is re adi l y m ea s ur abl e i n m one y. Acc or di ngl y, pecun iar y harm does not incl ud e em oti onal dist res s, h a r m t o r e pu tat ion, or ot her n o n - e c o n o mi c h a r m. ( i v) Reas onabl y Fo re s ee abl e Pe c uni ar y Harm
. - - For pu rposes ofthi s guid el ine, “reas onab ly f orese eab le pecuniary harm ” m eans pecuniary harm thatthe defen dantkne w or, unde r the c i r c u ms t a n c e s, r ea s onabl y s houl d have kno wn, w as a potenti al res ult ofthe offense . U .S.S .G . § 2 B 1 .1 c m t. n .3. H er e, i n c al cul at i ngthe numbero fv i ct i m s an d the est i m ate d l oss , the dist ri ct cour t adopted the figu re s com pil ed i n the seco nd addend um to the Pres entence64 N o. 08

- 3731 Report (“PSR”)
. A ccor ding to the a dd endu m , l oss w as es tim at ed atap p ro x im at e l y $3 9 m illion . Th is fi gure r epres ents the t ota la m ou nt o ffund s debi ted from i nd ivi d ua l acc ou nt s in respo ns e to A ssail’s te lem ar ket i ng ca l l s, l ess r efund s i ssued. A ccor dingl y, M r. Kim oto ’ s s entence w as i ncre ase d tw enty- tw o l eve l s. Se ei d. § 2B 1.1 (b )(1) ( L ) (ins tr u c tin g t h at offe n se lev els shoul d b e i nc r e a s e d b y t we nty - t wo f o rl o s s e s o fg r e a t er th an $ 2 0 mi l l i o n )
. Ad d i t i o n a l l y , t he a dden dum esti m ate d over50 0, 000 vi cti m s o fM r. Kim oto ’ s s chem e. This num berr epres ents the num berof i nd i vi du al s whose acco unts were debite d i n re sponse to A ssa i l ’ s t el ema r k e t i ngca l l s . Be c a us e th e n u mb e ro fv i c t i ms exceeded 25 0, M r. Kim oto ’ s o ffen se lev elwas i ncre ase d b y s ix lev els

. See i d. § 2 B1
. 1 ( b ) ( 2 ) ( C)
. Wi th a ddi t i onal a d ju s t m en ts not at i ssu e on th is app eal, M r. K im oto’s offense l eve lwas cal cul ate d at 45, wh i ch w as tr eat ed as an o ffense l eve lo f43

— the hi ghest offense l eve l se t fo rth on the sen te n c ing t abl e. A n offense l eve lo f43 , r egar dle ss ofa defe nd ant’ s cr i m i nalhi sto ryl eve l, r esul ts i n a r eco m m ended sentence o fl i fe i m pri sonm ent. A fte r ac c ep tin g t h e s en te n c in g c alc u lat ion se t fo rt h in the PS R, the cour t then deter m i ned th at, al though M r . K im oto ha d com m itted “an extrem ely seri ou s offen se , ” a l i fe s entence was “si m plyunrea sonab l e in [ i ts] vi ew . ” S en t. Tr. 13 8. A ccor dingl y, the cour t s entence d M r. K im oto to 350 m ont hs ’ i m p risonm en t. T he cou rt e xp l a i ne d: I n thi s ca se Iam go i ng to sentence hi m . . . to a ter m o n Counts 1 thro ugh 14 of25 m on ths perco unt to be ser ved co nsecuti vel y a nd notcon curr entl y. Thi s i s a nN o. 08

- 3731 65 effec ti ve s en te nc e o f3 50 months

. . . . 3 50 months ti m es 85 perce nt, as sum i ng h e g ets cr edi t forgo od tim e, is 2 97m on th s. T h at i s a b ou t 2 5 y ea rs , w h ich is ro ughly h alfo fhi s l i fe e xpectancy. S o he would ge t o utr o ug hl y a t ag e 58
. I t i s [ a] l o ngs en te nc e, s ubs ta nt i a l l y les s t h an [a] life s en te n c e, bu t is a se n te n c e, in m y v i ew, tha t m ee ts a l lo fthe r equi r ement s o f1 8[] U
. S. C. Se cti on 3 553( a) and i s not gre ate r than necessar y t o com plywith the nee d fo r the s entence to re fl ect th e ser i ousness o fthe offense, to pro m ote r es pec t f o r th e l aw an d to pr o vi de j us t pu ni sh m en t for th e o ffen se , t o affo rd a d eq u at e d et er re n c e t o c rim inalco nd uct and to pro tectthe pu bl i c fro m fu rther c rim es of th e d efe n d an t. Se nt. Tr. 14 8.

B. Est i m at e o fLoss I n chal l engi ng the di str i ct c ourt ’ s e sti m at ion o fl oss bef or e thi s co urt, M r. Kim oto does notdi spute the acc uracy o fthe r aw nu m be r s us ed bythe di st rict cou rt
. Tha t i s, he does not dispute that A ssa i lto ok i n at l eas t $ 39 m i l l i on fr o m the s al e o fi ts pr o duct s. I ns tead , M r . Ki m o to mai ntains that, bec ause ofthe necess i ty o f es tabl i shi ng ca usati on, thi s paym ent fi gure i s no t the equi val ent o fl oss . A lthou gh there is no qu estion th at th e sale ofA ssail’ s d eb it car d gener ate d the s um em plo yed bythe dist ri ct c ou rt, th er e is ev id en c e in th e re c or d th at n otev er y in d ivi dualwho a utho r i ze d the $ 15 9 deb i t o fhi s ac co unt w as decei ved by A ssa i l ’ s s al es pit ch; ther e were at l eas t66 N o. 08

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M r. Kim ot o be l ie ves thatthe Gover nm en t ’ s r el i anc e on 36 “in ten d ed ” as op p osed to “ actu al” lo ss “com es too late,” R ep ly Br. 22; he st ops short, how ever, of arguing that th e r el iance on i nt en ded l os s ha s be enwai ved. Our o wn revi ew ofthe re c or d re vea l s that, whi l e atthe di s t ri c t c ourt, the Gover nm en t raised inten d ed loss as an altern a t i v e t o actu al loss in it s res pon se to M r. K im oto’ s object ions to the PSR an d p res ente d evi dence i n s uppor tofani nt en ded l os s c al c ul at i on duri ng th e se n te n ci n g h ea ri n g . S eeSe n t. T r. 7 4 -8 0
. som e who und er sto od thatthey w oul d be r ecei vi ng a d eb it c ar d

. SeeSen t. T r. 53 -55 . Th e d ist ric t c ou rtac kn ow ledg ed th atthe r e m ayha ve b ee n so m e i ndi vi dual s who k ne w w ha t th eywer e g et ting ; ho w ever, b ec au se the raw nu m bers of ind ivi d ua ls and am ou nt of fun d s w ere so gr eat, i t be liev ed thatthe el i m i nati on o ftho se few i nd i vi du al s f ro m co nsi derat i on w ou l d not a f f ect M r . Ki m o to ’ s se nt en cingc al cul at i o n. Id. at55
. I f we ha d t o r e l y o n the di s t r i c t c o ur t ’ s a c t ua ll oss calcu lation, w e m ight be com p ell ed t o r em an d f or a m ore co ns i der ed es ti m at ion o fthe numbe ro fi ndi vi dual s who w er e no t dece i ved and, as a re sul t, a m or e defi ni ti ve deter m i nati on that the se ntenci ng calc ula ti on would not have been affecte d. H owever, thi s s tep i s unneces sar y. As r e fe r e nc ed pr e v i o us l y, the c o mm e nt a r y t o U. S
. S
. G. § 2 B1. 1 r equi re d the di str i ct c ourtto ap plythe “gr eat er of” actu al ori nt en d ed l oss. U
. S. S. G
. § 2B 1.1 cm t. n.3(A ). I fw e a p p l y a n int en ded l o ss fi g ur e, i t i s cl ea rtha t th e am oun t ofactual l oss pal es by com pari son. Defense 36 cou ns el r ep resen ted to the cou rt th at M r. K im oto p ur-N o. 08

- 3731 67

M r. K im oto’ s cl aim thatthe G overnm ent f ail ed to s how that 37 he “i nt en ded t o c aus e the l os s ” r el at ed t o thi s num berof con s um er s i s withoutm er i t
. Repl y Br
. 23
. The r ec or d i s r eplete w ith evidence that M r. K im o to w anted to c onv ince every potenti al pu rchas er that w hat he or she w as pu rchas ing w as a cr edit card. As s et f orth i n the app li cat ion no te, the f act tha t som e p ro sp ectiv e p u rch asers d id no t w a n t the ca rd , cou ld not purchase the card, or were not fooled do es not affect M r. K im o to ’s in te n t. S ee U. S. S. G. § 2B1. 1 c m t
. n. 3( A) ( st at i ng tha t loss “inclu d es inten d ed p ecu nia ry ha rm tha t w ou ld h a v e b ee n im p o ssi b le o r u n lik el y to o cc u r” ). chased l ead l i sts o fpoten tia l cust om er s co nsi sting o f approxi m ate l y 5 0, 000, 000 nam es. I t would be i nap p ro p r i a t e t o u s e thi s n u mb e rt o e s t i ma t e i n t e n d e d l o s s , h o wever, becau se testim ony also estab li sh ed that telem arketers anti ci pate onl y a sm al l perce ntage of posi ti ve re sponses fro m a lea d list; sp ec ifica lly, an “e x c elle n t li st ” w ou ld yield a tw o-perc en t return , w he r e a s a n av erage rate for return w ou ld yield a on e-p er c en t r e t u rn . Sen t. T r. 76 -80
. If, in 37 est i m ating i ntended lo ss, the cour t e m plo yed o nl y a n av er a g e r a t e o f r e t u r n ( o n e p e r c e n t ) a n d th e l o we s t o ft he pr i ce s atwhi cha n A ssail ca r d was o ffer ed ( $1 59 ) , the dist ri ct c ou rt w ou l d have a rr i ved atan intended lo ss fi g ur e o f$ 79 , 50 0, 00 0. An i nt en ded l o ss o fthi s amoun t cor re sponds to an o ffense- l eve lenhancem ent o f24, as opposed to the enhancem ent o f22 l eve l s r ecei ve d by M r. Kim oto
. A n even m or e m odest ra te ofr etur n ofo nehal fo fo ne per cent yi el ds an i ntended lo ss of$3 9, 750, 000, whi chi s ve r y c l o se t o th e n um be re m pl o y ed bythe di s t r i c tc o ur tf o ra c t ua ll oss and wh i c h a l s o c o r r e s po nd s68 N o. 08

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Any c r i t i c i s m th a t th i s me th o d o f a s c e r t a i n i n g l o s s i s t oo 38 s pec ul at i ve i s i rr el eva nti n thi s c as e. As no t ed above , the figu re u sed b y the d istrict cou rt rep resen ted in d i v i d u als w ho a ct ual l y r es ponde d t o As s ai l ’ s c al l an d ac t ual l y s pen t m oney o n i t s pr oduc t
. M r. Kim ot o, the re f or e, was gi venthe be ne fi to fthe doub tby be i ngs e nt e nc e d a s i fh e i nt e nd e d a los s based o n actual s ale s

— r e g a r d l e s s o fw h e th e r h i s s c h e me ant i c i pat ed a gr ea t ernum berofpur c has er s an d a g re at err etur n. to an e n h an c em en t o f 22 lev els

— the o ne ac tual l y r ecei ved by M r. Kim oto
. 38

C. Enhancem ent f orN um ber ofV i ct i m s W e ca nno t, ho wev er, a ppl y the sa m e r at i o na l e to the dist ri ct c ourt ’ s o ffense -leve lenhancem ent fornum ber of v ict im s. Se c tio n 2B 1.1 d efin es “v ict im ” a c c or d in gly : “V ictim ” m ean s (A ) an y pe rson w ho sustained any p art of the actu al l oss d eterm ined un d er sub sect ion (b)( 1); or( B) a ny i nd i vi du alwh o susta i ned bodi l y i nj u ry as a r esul t o fthe offense. “Per son” i nc lu des i nd i vi du al s, corp orations, com p an ies, assoc iations, fi rm s, p artn ershi ps, so ci eti es, and j oi nt st ockco m panie s. U. S
. S
. G. § 2 B1. 1 defi ni ti o ns . In oth erwor ds, wher ea s th e l oss cal cul ati on ca n b e ba sed o n ei theractual o r i ntended l oss , the est i m ati on o fthe num bero fvi cti m s i s l i m i ted to thos e who i ncurr ed part ofthe actuall oss . H er e, th e P SR (ad op te d by th e c ou rt ) co n sid er ed all pu rchas er s, wello ver50 0,0 00, to be vi cti m s. I t di d not est i m ate h ow m any o fthes e ind i vi du al s purchas edN o. 08

- 3731 69 A ssa i l ’ s pro du cts as a r esul t o fA ssa i l ’ s dece pti ve sal es effo rt s. There is ev i dence i n the re cor d fr om wh i ch the dist ri ct cour t co uld have r eached a re aso nabl e esti m ate of vi cti m s, spe ci fi ca l l y, the c us to m ers er vi ce r ec o r d s from S OS , the tes ti m ony ofLankford and o fPor cel l iduri ng tr i al, as we l la s th e t e s t i mo ny o fK r i s t e n D a v i s a ts e n t e n c i n g . We ar e skepti ca ltha t, a fte rr ev i ew o fthi s ev i den ce , the d istri ct cou rt reason ably cou ld con clud e tha t the re w ere l e s s th a n 2 5 1 i n d i v i d u a l s wh o s u ffe r e d a c t u a ll o s s . Ho weve r, thati s a deter m i nati on f orthe dist ri ct c ou rtto m ake i n the fi rs t instance
. Because the di str i ct court ’ s cal cul ati on o fthe num bero f vi cti m s di d not focus o n actuall oss , and beca use that e n h a n c e me n ta ffe c t s M r . Ki mo t o ’ s s e n t e n c i n gr a n g e , we re m and to the di str i ct c ourtf ora m or e defi ni te cal cul ati on o fthe num b ero fvi cti m s. I fthe dist ri ct c ourt, aft er rev iew of th e re c or d a n d b a s e d on a re as on ab le e s t i mat e , c o nc l udes tha tthe n umb e ro fv i c t i ms e xc e e ds 25 0, the n th e o r i g i na l se nt en ce sh al ls ta nd. I f, ho wev er, the court co ncl ud es that the num bero fvi cti m s doe s no t ex ce ed 25 0, the n i t m us t r ee va l ua te i ts e nha nc ement pu rs u an t to U
. S. S. G. § 2 B1. 1( b) ( 2) ( C). W e e m phasi ze th at th is is a ve ry lim i t ed rem an d , con fin ed to th e c alc ul a t i o n o f the nu mbe r o f v i c t i ms f o r pu r po s e s o f § 2 B1
. 1 ( b ) ( 2 ) ( C ) ; n o o th e ra s p e c t s o fMr
. Ki mo t o ’ s s e nte n c in g s h ou ld be rev isit ed

.70 N o. 08

- 3731 Conclusi on Forthe f or ego i ng r eas ons, the j ud gm ent o ft h e d i str i ct c o ur t wi th r e s pe c t t o M r . Ki mot o ’ s c o nv i c t i o n i s a ffi r med

. Ad di ti o na l l y, we affi r m a ll as pec ts o fM r . Ki m o to ’ s se nt e n c i n gw i th th e e x c e p t i o n o fth e c a l c u l a t i o n o fv i c t i ms und erU
. S. S. G. § 2B 1.1 ( b) ( 2) ( C). W e r em and that a spect ofM r. Kim oto ’ s s entence to the dist ri ct c ourtf or fu rt h er find in gs co n c e r n i n g th e n u m b er of vic tim s. In ev er y ot h er res p ec t, th e jud gm en t o ft h e d ist ric t c ou rtis a ffi r med

. A FFI RMED in p ar t; R EMAND ED i n p art

12- 2- 09