Court Opinion

ID: 2969888
Source: CourtListenerOpinion
Date Created: 2015-09-22 15:59:36.287402+00
Date Added: 2024-06-11T11:35:04.382618
License: Public Domain

5(&200(1'(' )25 )8//7(;7 38%/,&$7,21
             3XUVXDQW WR 6L[WK &LUFXLW 5XOH 

     (/(&7521,& &,7$7,21  )(' $SS 3 WK &LU
                 )LOH 1DPH DS

81,7('67$7(6&28572)$33($/6
               )257+(6,;7+&,5&8,7
                 BBBBBBBBBBBBBBBBB

 s())5(< '(:$<1( &/$5.           ;
         3HWLWLRQHU$SSHOODQW     
                                   
                                      1R
            Y                     
                                    !
                                   
 0,&+$(/ 2j'($                    
          5HVSRQGHQW$SSHOOHH 
                                   
                                   
                                  1
       $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
    IRUWKH:HVWHUQ'LVWULFWRI.HQWXFN\DW/RXLVYLOOH
          1Rn&KDUOHV56LPSVRQ,,,
                   &KLHI'LVWULFWsXGJH
                 6XEPLWWHG0D\
             'HFLGHGDQG)LOHGsXO\
 %HIRUHs21(66,/(5DQG*,/0$1&LUFXLWsXGJHV
                   BBBBBBBBBBBBBBBBB
                        &2816(/
21 %5,()  3HUU\ 7 5\DQ $66,67$17 $77251(<
*(1(5$/ )UDQNIRUW .HQWXFN\ IRU $SSHOOHH  sHIIUH\
'H:D\QH&ODUN&HQWUDO&LW\.HQWXFN\SURVH

                             
     &ODUNY2j'HD                                1R

                     BBBBBBBBBBBBBBBBB
                         23,1,21
                     BBBBBBBBBBBBBBBBB
   521$/'/((*,/0$1&LUFXLWsXGJHsHIIUH\'H:D\QH
&ODUNDSSHDOVWKHGLVWULFWFRXUWjVGHQLDORIKLVSHWLWLRQIRUD
ZULWRIKDEHDVFRUSXVILOHGSXUVXDQWWR86&$
.HQWXFN\MXU\FRQYLFWHG&ODUNRIILUVWGHJUHHPXUGHULQ
7KHVWDWHWULDOFRXUWVXEVHTXHQWO\VHQWHQFHG&ODUNWRDWHUPRI
OLIHLPSULVRQPHQW:HJUDQWHGDFHUWLILFDWHRIDSSHDODELOLW\
DV WR WKH IROORZLQJ LVVXHV  ZKHWKHU WKH WULDO FRXUW
LPSURSHUO\DGPLWWHGHYLGHQFHRIVDWDQLVPZKHWKHUWKH
WULDORI&ODUNDQGKLVFRGHIHQGDQWZDVLPSURSHUO\MRLQHGDQG
 ZKHWKHU WKH SURVHFXWLRQ LPSURSHUO\ ZLWKKHOG D OHWWHU
ZULWWHQE\DMDLOKRXVHLQIRUPDQW)RUWKHUHDVRQVVHWIRUWK
EHORZ ZH $)),50 WKH GLVWULFW FRXUWjV GHQLDO RI &ODUNjV
SHWLWLRQIRUKDEHDVFRUSXVUHOLHI
                     ,%$&.*5281'
$ )DFWXDOEDFNJURXQG
  2Q $SULO   5KRQGD 6XH :DUIRUG ZDV UHSRUWHG
PLVVLQJE\KHUPRWKHU7KH/RXLVYLOOHSROLFHOHDUQHGIURP
WKH PRWKHU WKDW :DUIRUG KDG UHFHQWO\ GDWHG *DUU .HLWK
+DUGLQ DQG WKDW &ODUN ZDV DQ DVVRFLDWH RI +DUGLQ  7KUHH
GD\VODWHU0HDGH&RXQW\'HSXW\6KHULII*UHHUZDVQRWLILHG
WKDWDERG\ODWHUGHWHUPLQHGWREH:DUIRUGjVKDGEHHQIRXQG
LQDILHOGRII+LJKZD\LQ0HDGH&RXQW\+HUERG\ZDV
IRXQGO\LQJIDFHGRZQFODGLQZKLWHFDQYDVWHQQLVVKRHVUHG
VZHDWSDQWVDGDUNEOXHVKLUWDQGDPXOWLFRORUHGMDFNHW
   8SRQ H[DPLQLQJ :DUIRUGjV ERG\ WKH &KLHI 0HGLFDO
([DPLQHUIRUWKH&RPPRQZHDOWKRI.HQWXFN\IRXQGPDQ\
VWDEZRXQGVWRKHUEDFNDLQFKFXWRQWKHVXUIDFHRIKHU
ULJKWKDQGDQGDLQFKFXWRQKHUULJKWLQGH[ILQJHU+H
DOVRREVHUYHGDVWDEZRXQGWKDWSLHUFHGKHUOXQJWKURXJKKHU
XSSHUULJKWFKHVWDQGVWDEZRXQGVDWWKHEDVHRIKHUVNXOORQH
RI ZKLFK VHYHUHG KHU EUDLQ VWHP  :DUIRUGjV LQMXULHV ZHUH
FDXVHGE\DVKDUSVLQJOHHGJHGLQVWUXPHQWVXFKDVDNQLIH
1R                                 &ODUNY2j'HD         

7KHH[DPLQHUDOVRVDZWKDW:DUIRUGKDGDQLQYHUWHGFURVV
WDWWRRHGEHORZKHUOHIWFODYLFOH
  'XULQJ WKH LQYHVWLJDWLRQ WKH 0HDGH &RXQW\ 6KHULIIjV
'HSDUWPHQWLQWHUYLHZHGERWK&ODUNDQG+DUGLQ&ODUNGHQLHG
RZQLQJDNQLIH+HDOVRFODLPHGWKDWWKHODVWWLPHKHKDG
VHHQ:DUIRUGZDVLQ'HFHPEHURIDQGWKDWKHZDVZLWK
+DUGLQIURPWKHHYHQLQJRI$SULOWKURXJKWKHQH[W
PRUQLQJ+DUGLQDGPLWWHGWKDWKHRZQHGDNQLIHEXWFODLPHG
WKDWWKHODVWWLPHKHVDZ:DUIRUGZDVRQ0DUFK
ZKHQKHVWD\HGDWKHUKRXVH+HDOVRFODLPHGWKDWKHZDV
ZLWK&ODUNIURPWKHHYHQLQJRI$SULOWKURXJKWKHQH[W
PRUQLQJORRNLQJIRU&ODUNjVORVWVQDNHDQGGULQNLQJEHHU
   7KH VKHULII KRZHYHU GHWHUPLQHG WKDW RQH KDLU IURP WKH
YLFWLPjV VZHDW SDQWV KDG VLPLODU FKDUDFWHULVWLFV WR WKH KDLU
VDPSOHVWDNHQIURP+DUGLQ7KHIDFWWKDW:DUIRUGjVPRWKHU
KDG ZDVKHG WKH VZHDW SDQWV VKRUWO\ EHIRUH :DUIRUG ZRUH
WKHPRQ$SULOVXJJHVWHGWRWKHSROLFHWKDW+DUGLQKDG
OLHGDERXWQRWVHHLQJ:DUIRUGMXVWSULRUWRKHUGHDWKEHFDXVH
WKHKDLUFRXOGQRWKDYHJRWWHQRQWKHVZHDWSDQWVRWKHUZLVH
,QDGGLWLRQWKHVKHULIIIRXQGRQHRI:DUIRUGjVILQJHUSULQWVRQ
&ODUNjVFDU7KHSUHVHQFHRIWKHILQJHUSULQWZDVLQFRQVLVWHQW
ZLWK&ODUNjVVWDWHPHQWWKDW:DUIRUGKDGQRWEHHQLQKLVFDU
VLQFH'HFHPEHURI
  6HDUFKZDUUDQWVIRUERWK&ODUNjVDQG+DUGLQjVUHVLGHQFHV
ZHUHREWDLQHG7KHVKHULIIIRXQGYDULRXVRFFXOWUHODWHGLWHPV
DQG GRFXPHQWV DW +DUGLQjV UHVLGHQFH DQG NQLYHV DW WKH
UHVLGHQFHVRIERWK&ODUNZDVVXEVHTXHQWO\LQWHUYLHZHGE\
WKH VKHULII DQG DUUHVWHG  $Q LQIRUPDQW &OLIIRUG &DSSV
FODLPHGWKDWKHZDVKRXVHGLQDFHOOZLWK&ODUN&DSSVODWHU
WHVWLILHGWKDW&ODUNRQWZRGLIIHUHQWRFFDVLRQVWROG&DSSV
WKDWKHKDGNLOOHG:DUIRUGRQFHMRNLQJO\DQGDQRWKHUWLPH
ZLWKDVHULRXVH[SUHVVLRQ
% 3URFHGXUDOEDFNJURXQG
  2Q 0D\   WKH 0HDGH &RXQW\ JUDQG MXU\ LQGLFWHG
ERWK &ODUN DQG +DUGLQ FKDUJLQJ HDFK RI WKHP ZLWK ILUVW
GHJUHH PXUGHU  7KH\ ZHUH MRLQWO\ WULHG EHIRUH D MXU\ LQ D
     &ODUNY2j'HD                                    1R       1R                                 &ODUNY2j'HD        

VHYHQGD\WULDOZKLFKODVWHGIURP)HEUXDU\WR0DUFK                    )XUWKHUPRUH HYHQ LI WKH VWDWH KDG SULRU NQRZOHGJH RI
7KHMXU\IRXQGWKHPERWKJXLOW\RIILUVWGHJUHHPXUGHU            &DSSVjV OHWWHU WKH OHWWHU GRHV QRW PHHW WKH VWDQGDUG IRU
                                                                          JUDQWLQJ KDEHDV UHOLHI  2Q KDEHDV UHYLHZ D IHGHUDO FRXUW
   'XULQJWKHWULDOVHYHUDOZLWQHVVHVWHVWLILHGDERXW&ODUNjV            PXVWDVNZKHWKHUmWKHJRYHUQPHQWjVHYLGHQWLDU\VXSSUHVVLRQ
DQG+DUGLQjVVDWDQLFZRUVKLS$P\3DGJHWWDQH[JLUOIULHQG              µXQGHUPLQHVFRQILGHQFHLQWKHRXWFRPHRIWKHWULDOjl.\OHV
RI &ODUN VDLG WKDW &ODUN ZDV RQFH LQYROYHG ZLWK VDWDQLF         Y :KLWOH\  86     &DSSVjV OHWWHU
ZRUVKLSWKDWKHRZQHGQXPHURXVNQLYHVDQGJXQVDQGWKDW                 KRZHYHU ZDV DW EHVW DPELJXRXV DV WR &ODUNjV JXLOW RU
KHKDGDQLQYHUWHGFURVVWDWWRRHGRQKLVVKRXOGHU6KHVWDWHG            LQQRFHQFH5DWKHULWVXVHIXOQHVVZDVOLPLWHGWRLPSHDFKLQJ
WKDW &ODUN  WROG KHU WKDW KH ZRXOG OLNH WR WU\ NLOOLQJ D   WKHFUHGLELOLW\RI&DSSVZKLFK&ODUNDOUHDG\GLGGXULQJWKH
SHUVRQEHFDXVHLWZRXOGEHDFKDOOHQJHWRVHHLIKHFRXOGGR              WULDO%HFDXVHLWFDQQRWEHVDLGWKDWmWKHUHLVDUHDVRQDEOH
LWDQGJHWDZD\ZLWKLWH[SODLQHGKRZDSHUVRQFRXOGEH              SUREDELOLW\ WKDW KDG WKH HYLGHQFH >RI &DSSVjV OHWWHU@ EHHQ
NLOOHGE\DVWDEZRXQGWRWKHEDVHRIWKHVNXOOWRRNKHUWR          GLVFORVHGWRWKHGHIHQVHWKHUHVXOWRIWKHSURFHHGLQJZRXOG
DQDUHDZKHUHKHFODLPHGDQXPEHURIDQLPDOVDFULILFHVKDG                KDYH EHHQ GLIIHUHQWl %DJHOH\  86 DW  &ODUNjV
EHHQ PDGH DQG  ZDV IDPLOLDU ZLWK WKH DUHD ZKHUH              DUJXPHQWIRUDQHZWULDOPXVWIDLOHYHQLIWKHVWDWHKDGEHHQ
:DUIRUGjVERG\ZDVIRXQG                                                 LQDSRVLWLRQWRGLVFORVH&DSSVjVOHWWHU
  $QRWKHU ZLWQHVV +RSH sDJJHUV WHVWLILHG WKDW VKH ZDV                                 ,,,&21&/86,21
:DUIRUGjV EHVW IULHQG IRU D \HDU SULRU WR :DUIRUGjV GHDWK
sDJJHUVVDLGWKDWVKHKHDUG:DUIRUGWHOO+DUGLQWKDW:DUIRUG                )RU DOO WKH UHDVRQV VHW IRUWK DERYH ZH ILQG QR PHULW LQ
ZDVSUHJQDQWDQGWKDW+DUGLQUHVSRQGHGE\VD\LQJWKDWmLI                &ODUNjVFODLPVIRUKDEHDVUHOLHI:HWKHUHIRUH$)),50WKH
\RXDUHSUHJQDQW,ZLOONLOO\RXDQGWKDW>H[SOHWLYH@EDE\l,Q         MXGJPHQWRIWKHGLVWULFWFRXUW
DGGLWLRQVKHWROGWKHMXU\WKDWVKHKDGRQFHVHHQ:DUIRUGFXW
KHUILQJHUWLSVZLWKDUD]RUDQGUXEWKHEORRGRQ+DUGLQ%XW
ZKHQsDJJHUVZDVDVNHGZKHWKHUHLWKHU&ODUNRU+DUGLQZDV
LQYROYHGZLWKVDWDQLVPVKHVWDWHGWKDWVKHKDGQRNQRZOHGJH
RIVXFKLQYROYHPHQW
  <HW DQRWKHU ZLWQHVV 6KDZQ /HH 0DWWLQJO\ D IULHQG RI
&ODUNWHVWLILHGWKDW&ODUNDOPRVWDOZD\VFDUULHGDNQLIHZLWK
KLP DQG WKDW &ODUN FDOOHG RQH RI WKH NQLYHV D mVDFULILFLDO
NQLIHl0DWWLQJO\DOVRWROGWKHMXU\WKDW&ODUNKDGDGPLWWHG
WRKLPWKDW&ODUNKDGRQFHVDFULILFHGDQDQLPDOLQIURQWRID
FKXUFKDQDFWWKDWZDVUHSRUWHGRQWKHORFDOQHZV
  2WKHUZLWQHVVHVGHQLHGKDYLQJDQ\NQRZOHGJHRI&ODUNjV
LQYROYHPHQWLQVDWDQLVP7ZRZLWQHVVHVn:DUIRUGjVVLVWHU
DQGRQHRIKLVFRXVLQVnVDLGWKDWWKH\KDGQHYHUVHHQ&ODUN
RU +DUGLQ LQYROYHG LQ DQ\ VDWDQLF DFWV  :DUIRUGjV VLVWHU
KRZHYHUWHVWLILHGWKDWVKHNQHZWKDW+DUGLQZDVLQYROYHGLQ
VDWDQLF ZRUVKLS  :KHQ &ODUNjV PRWKHU DQG VWHSIDWKHU
WHVWLILHGWKH\GHQLHGHYHUVHHLQJDQLQYHUWHGFURVVWDWWRRHGRQ
    &ODUNY2j'HD                                1R       1R                                 &ODUNY2j'HD          

FRS\RI&DSSVjVOHWWHUWR6KHULII*UHHU6KHULII*UHHUjVRZQ         &ODUNjVVKRXOGHU&ODUNDOVRGHQLHGWKDWKHZDVLQYROYHGLQ
DIILGDYLWVWDWHVWKDWKHKDGQHYHUEHHQWROGRIQRUUHFHLYHGD      WKHRFFXOWRULQVDWDQLFSUDFWLFHV
FRS\RIDQ\OHWWHUE\&DSSVWRsXVWLVSULRUWR&ODUNjVPRWLRQ
IRUDQHZWULDO+HLQIDFWGHQLHVKDYLQJHYHUVSRNHQWRsXVWLV       2Q0D\WKHVWDWHFRXUWHQWHUHGMXGJPHQWDJDLQVW
,QDGGLWLRQ'HSXW\6KHULII:LVHSURYLGHGDQDIILGDYLWVWDWLQJ        &ODUN DQG +DUGLQ VHQWHQFLQJ HDFK RI WKHP WR OLIH
WKDWKHKDGGLVFXVVHGWKH&ODUNFDVHZLWK6KHULII*UHHUPDQ\          LPSULVRQPHQW7KLVWLPHO\DSSHDOE\&ODUNIROORZHG
WLPHVSULRUWRWKHWULDO$FFRUGLQJWR:LVH6KHULII*UHHUKDG
WROGKLPWKDW&DSSVKDGJLYHQDVWDWHPHQWmEXWWKDW.HYLQ                                    ,,$1$/<6,6
sXVWLVKDGUHIXVHGWRVSHDNWR>6KHULII*UHHU@l9DULRXVRWKHU
DIILGDYLWVIURPWKHVWDIIRIWKH%UHFNLQULGJH&RXQW\&OHUNjV          $ 6WDQGDUGRIUHYLHZ
2IILFHDOVRVXSSRUWWKHVWDWHjVFODLPWKDWsXVWLVKDGUHIXVHGWR
VSHDNWR6KHULII*UHHUDQGWKDW6KHULII*UHHUGLGQRWKDYHD            7KH$QWLWHUURULVPDQG(IIHFWLYH'HDWK3HQDOW\$FWRI
FRS\ RI WKH OHWWHU  )XUWKHUPRUH WKH 0HDGH &RXQW\            3XE / 1R   6WDW  $SU  
&RPPRQZHDOWK$WWRUQH\VWDWHGLQKLVDIILGDYLWWKDWKHKDG             $('3$DSSOLHVWR&ODUNjVFDVHEHFDXVHKHILOHGKLVKDEHDV
VSRNHQWRWKH&RORUDGRSURVHFXWRUDQGWKDWQRWKLQJZDVHYHU          FRUSXV SHWLWLRQ SXUVXDQW WR  86&   DIWHU WKH
PHQWLRQHGWRKLPDERXW&DSSVjVOHWWHU                                HIIHFWLYHGDWHRI$('3$6HH/LQGKY0XUSK\86
                                                                      $IHGHUDOFRXUWLVDXWKRUL]HGWRJUDQWDZULW
   2Q KDEHDV UHYLHZ WKH VWDWH FRXUWjV IDFWXDO ILQGLQJV DUH   RI KDEHDV FRUSXV WR D SHUVRQ LQ FXVWRG\ SXUVXDQW WR D
DFFRUGHGJUHDWGHIHUHQFHm,QDSURFHHGLQJLQVWLWXWHGE\DQ          VWDWHFRXUWMXGJPHQWEXWRQO\LI
DSSOLFDWLRQIRUDZULWRIKDEHDVFRUSXVE\DSHUVRQLQFXVWRG\
SXUVXDQWWRWKHMXGJPHQWRID6WDWHFRXUWDGHWHUPLQDWLRQRI           WKHDGMXGLFDWLRQRIWKHFODLPUHVXOWHGLQDGHFLVLRQ
DIDFWXDOLVVXHPDGHE\D6WDWHFRXUWVKDOOEHSUHVXPHGWREH           WKDW ZDV FRQWUDU\ WR RU LQYROYHG DQ XQUHDVRQDEOH
FRUUHFW7KHDSSOLFDQWVKDOOKDYHWKHEXUGHQRIUHEXWWLQJWKH          DSSOLFDWLRQ RI FOHDUO\ HVWDEOLVKHG )HGHUDO ODZ DV
SUHVXPSWLRQ RI FRUUHFWQHVV E\ FOHDU DQG FRQYLQFLQJ                GHWHUPLQHGE\WKH6XSUHPH&RXUWRIWKH8QLWHG6WDWHVRU
HYLGHQFHl   86&  H  7KXV UHJDUGOHVV RI        UHVXOWHG LQ D GHFLVLRQ WKDW ZDV EDVHG RQ DQ
ZKHWKHU ZH ZRXOG UHDFK D GLIIHUHQW FRQFOXVLRQ ZHUH ZH           XQUHDVRQDEOH GHWHUPLQDWLRQ RI WKH IDFWV LQ OLJKW RI WKH
UHYLHZLQJWKHFDVH GH QRYRWKHILQGLQJVRIWKHVWDWHFRXUW           HYLGHQFHSUHVHQWHGLQWKH6WDWHFRXUWSURFHHGLQJ
PXVWEHXSKHOGXQOHVVWKHUHLVFOHDUDQGFRQYLQFLQJHYLGHQFH          86&G
WRWKHFRQWUDU\
                                                                         7KH 6XSUHPH &RXUW KDV GHFODUHG WKDW mD IHGHUDO KDEHDV
  *LYHQWKHH[LVWHQFHRIWKHQXPHURXVDIILGDYLWVLQVXSSRUW           FRXUWPDNLQJWKHµXQUHDVRQDEOHDSSOLFDWLRQjLQTXLU\VKRXOG
RIWKHVWDWHjVSRVLWLRQZHDUHXQDEOHWRFRQFOXGHWKDW&ODUN         DVNZKHWKHUWKHVWDWHFRXUWjVDSSOLFDWLRQRIFOHDUO\HVWDEOLVKHG
KDV SURYLGHG FOHDU DQG FRQYLQFLQJ HYLGHQFH WKDW WKH VWDWH     IHGHUDO ODZ ZDV REMHFWLYHO\ XQUHDVRQDEOHl  :LOOLDPV Y
FRXUWFRPPLWWHGDQHUURULQPDNLQJLWVIDFWXDOGHWHUPLQDWLRQ          7D\ORU86,QLWVHODERUDWLRQRQWKH
WKDW6KHULII*UHHUKDGQRWVHHQWKHOHWWHULQTXHVWLRQSULRUWR       PHDQLQJRIWKHWHUPmREMHFWLYHO\XQUHDVRQDEOHlWKH&RXUW
&ODUNjVWULDO%HFDXVHWKHVWDWHZDVIRXQGWRKDYHQRSULRU          VWDWHG WKDW mD IHGHUDO KDEHDV FRXUW PD\ QRW LVVXH WKH ZULW
NQRZOHGJHRUSRVVHVVLRQRIWKHOHWWHUDQGWKHUHIRUHFRXOGQRW        VLPSO\ EHFDXVH WKDW FRXUW FRQFOXGHV LQ LWV LQGHSHQGHQW
SRVVLEO\ KDYH GLVFORVHG LWV H[LVWHQFH &ODUNjV FODLP RI        MXGJPHQWWKDWWKHUHOHYDQWVWDWHFRXUWGHFLVLRQDSSOLHGFOHDUO\
SURVHFXWRULDOPLVFRQGXFWPXVWIDLO                                   HVWDEOLVKHGIHGHUDOODZ HUURQHRXVO\RULQFRUUHFWO\5DWKHU
                                                                      WKDW DSSOLFDWLRQ PXVW DOVR EH XQUHDVRQDEOHl  ,G DW 
      &ODUNY2j'HD                                  1R       1R                                  &ODUNY2j'HD        

)LQDOO\DGLVWULFWFRXUWjVGHQLDORIWKHZULWLVVXEMHFWWRGH          :DUIRUG WKHUHE\ FRUURERUDWLQJ &DSSVjV WHVWLPRQ\ DQG
QRYRUHYLHZ6HH5RJHUVY+RZHV)GWK                DVVLVWLQJ&DSSVZLWKREWDLQLQJKLVRZQUHOHDVHRQSUREDWLRQ
&LU                                                              7KLVOHWWHUZDVGLVFRYHUHGE\&ODUNDIWHUWKHMXU\UHWXUQHGLWV
                                                                         YHUGLFWDQGZDVWKHEDVLVRI&ODUNjVPRWLRQIRUDQHZWULDO
% $GPLVVLRQRIHYLGHQFHDERXWVDWDQLVP                                  &ODUNPDLQWDLQVWKDWKHFRXOGKDYHXVHGWKLVOHWWHUWRLPSHDFK
                                                                         WKHFUHGLELOLW\RI&DSSVZKRWHVWLILHGWKDW&ODUNDGPLWWHGWR
   ,QKLVILUVWFODLPIRUUHOLHI&ODUNDUJXHVWKDWWKHWULDOFRXUW      NLOOLQJ :DUIRUG  %XW WKH VWDWH FODLPV WKDW LW ZDV QRW HYHQ
YLRODWHG KLV ULJKW WR GXH SURFHVV E\ SHUPLWWLQJ WKH VWDWH WR   DZDUHRIWKLVOHWWHUXQWLO&ODUNILOHGKLVPRWLRQ
LQWURGXFH WHVWLPRQ\ WKDW KH DQG +DUGLQ ZHUH LQYROYHG LQ
VDWDQLVPGHVSLWHWKHODFNRIDQ\SK\VLFDOHYLGHQFHWKDWWKH                $FFRUGLQJWR%UDG\Y0DU\ODQG86mWKH
GHDWKRI:DUIRUGUHVXOWHGIURPDULWXDOLVWLFPXUGHU&ODUN              VXSSUHVVLRQE\WKHSURVHFXWLRQRIHYLGHQFHIDYRUDEOHWRDQ
FRQWHQGVWKDWE\DGPLWWLQJWHVWLPRQ\DERXWVDWDQLVPWKHVWDWH           DFFXVHGXSRQUHTXHVWYLRODWHVGXHSURFHVVZKHUHWKHHYLGHQFH
WULDOFRXUWYLRODWHG.HQWXFN\5XOHRI(YLGHQFHDZKLFK             LV PDWHULDO HLWKHU WR JXLOW RU WR SXQLVKPHQWl  ,G DW 
SURKLELWVDGPLVVLRQRIm>H@YLGHQFHRIDSHUVRQjVFKDUDFWHURU            (YLGHQFHLVPDWHULDOmRQO\LIWKHUHLVDUHDVRQDEOHSUREDELOLW\
DWUDLWRIFKDUDFWHUIRUWKHSXUSRVHRISURYLQJDFWLRQLQ          WKDWKDGWKHHYLGHQFHEHHQGLVFORVHGWRWKHGHIHQVHWKHUHVXOW
FRQIRUPLW\WKHUHZLWKRQDSDUWLFXODURFFDVLRQl                        RIWKHSURFHHGLQJZRXOGKDYHEHHQGLIIHUHQWl8QLWHG6WDWHV
                                                                         Y%DJHOH\867KHWKUHVKROGLVVXHLQ
  7KHVWDWHKRZHYHUFODLPVWKDWLWLQWURGXFHGWKHWHVWLPRQ\            WKH SUHVHQW FDVH KRZHYHU LV ZKHWKHU WKH VWDWH KDG DQ\
QRW WR VKRZ mEDG FKDUDFWHUl EXW WR VXSSRUW LWV WKHRU\ WKDW    NQRZOHGJH RI WKH OHWWHU SULRU WR EHLQJ LQIRUPHG RI LWV
:DUIRUGjVPXUGHUZDVPRWLYDWHGE\WKHEHOLHIRI&ODUNDQG                H[LVWHQFHLQ&DSSVjVPRWLRQIRUDQHZWULDO,QLWVUXOLQJRQ
+DUGLQWKDWWKH\ZRXOGJDLQSRZHUE\NLOOLQJKHU,WSRLQWV             WKLVLVVXHWKHVWDWHFRXUWIRXQGWKDWWKHSURVHFXWLRQKDGQR
RXW WKDW .HQWXFN\ 5XOH RI (YLGHQFH E GLVWLQJXLVKHV           VXFKNQRZOHGJH
HYLGHQFH RI mFKDUDFWHUl IURP WKDW RI mPRWLYHl DQG DOORZV
m>H@YLGHQFHRIRWKHUFULPHVZURQJVRUDFWV>L@IRIIHUHG             7KHUHLVHYLGHQFHLQWKHUHFRUGVWURQJO\VXJJHVWLQJWKDWWKH
IRUVRPHRWKHUSXUSRVHVXFKDVSURRIRIPRWLYHRSSRUWXQLW\            VWDWH LQ IDFW ZDV DZDUH RI WKH H[LVWHQFH RI &DSSVjV OHWWHU
LQWHQWSUHSDUDWLRQSODQNQRZOHGJHLGHQWLW\RUDEVHQFHRI            6XSSOHPHQWDODIILGDYLWVILOHGE\&ODUNFODLPWKDWsXVWLVWR
PLVWDNHRUDFFLGHQWl,QGLVFXVVLQJWKLVSRLQWWKH.HQWXFN\            ZKRP &DSSVjV OHWWHU ZDV VHQW WROG D &RORUDGR SXEOLF
6XSUHPH&RXUWVSHFLILFDOO\VWDWHG                                       GHIHQGHU+DUYH\3DOHIVN\WKDWKHKDGVKRZQ6KHULII*UHHU
                                                                         WKHOHWWHUIURP&DSSV3DOHIVN\KDGEHHQLQWHUYLHZLQJsXVWLV
    $ UHYLHZ RI WKH UHFRUG GHPRQVWUDWHV WKDW WKH                  LQSUHSDUDWLRQIRUDGLIIHUHQWPXUGHUWULDOLQZKLFK&DSSVDQG
    &RPPRQZHDOWKSUHVHQWHGHYLGHQFHRWKHUWKDQWKDWQRWHG               sXVWLV ZHUH DQWLFLSDWHG ZLWQHVVHV DJDLQVW D GHIHQGDQW WKDW
    E\>&ODUN@WRVXEVWDQWLDWHLWVWKHRU\WKDW:DUIRUGjVGHDWK          3DOHIVN\ZDVUHSUHVHQWLQJ&ODUNDOVRILOHGWKHDIILGDYLWVRI
    ZDV PRWLYDWHG E\ WKH SHUIRUPDQFH RI D 6DWDQLF ULWXDO        WKUHH &RORUDGR DWWRUQH\V n 3DOHIVN\ DQRWKHU SXEOLF
    7KHIDFWWKDWWKH&RPPRQZHDOWKjVRYHUDOOSURRIRQWKLV               GHIHQGHUDQGDSURVHFXWRUnLQZKLFKWKHDWWRUQH\VVZRUH
    LVVXHLQUHWURVSHFWZDVQRWVWURQJGRHVQRWGHWUDFWIURP             WKDW6KHULII*UHHUYHUEDOO\DFNQRZOHGJHGKDYLQJDFRS\RIWKH
    WKHLQLWLDODGPLVVLELOLW\RIWKHHYLGHQFHLQTXHVWLRQ              OHWWHUIURP&DSSVWRsXVWLV
  :HDJUHHZLWKWKH.HQWXFN\6XSUHPH&RXUW7KHUHZDV                     7KH UHFRUG KRZHYHU DOVR FRQWDLQV FRXQWHUDIILGDYLWV
WHVWLPRQ\WKDW&ODUNKDGVSHFLILFDOO\UHIHUUHGWRRQHRIKLV             LQGLFDWLQJWKDW6KHULII*UHHUZDVQRWDZDUHRIWKHOHWWHU$Q
NQLYHVDVDmVDFULILFLDONQLIHlDQGWKDWDFFRUGLQJWRFHUWDLQ           DIILGDYLWE\sXVWLVIRULQVWDQFHDYHUVWKDWKHGLGQRWJLYHD
VDWDQLFWHDFKLQJVZRUVKLSSHUVFRXOGHPSRZHUWKHPVHOYHVE\
    &ODUNY2j'HD                                 1R       1R                                 &ODUNY2j'HD        

   1RU KDV &ODUN GHPRQVWUDWHG WKDW WKH .HQWXFN\ 6XSUHPH         NLOOLQJ RWKHU OLYLQJ EHLQJV  :DUIRUGjV ERG\ ZDV IRXQG
&RXUWLQDOORZLQJ&ODUNDQG+DUGLQWREHMRLQWO\WULHGEDVHG         WDWWRRHGZLWKDQLQYHUWHGFURVVDQGZHDULQJUHGVZHDWSDQWV
LWVGHFLVLRQRQmDQXQUHDVRQDEOHDSSOLFDWLRQRIFOHDUO\          DFRORUZKLFK+DUGLQDFNQRZOHGJHGZDVmDELJFRORULQWKLV
HVWDEOLVKHG )HGHUDO ODZl DV UHTXLUHG IRU KDEHDV UHOLHI     6DWDQLVPVWXIIl$OWKRXJKWKLVHYLGHQFHZDVQRWFRQFOXVLYH
86&G,QDSULRUFDVHWKH.HQWXFN\6XSUHPH              LW GLG WHQG WR VXSSRUW WKH VWDWHjV WKHRU\ WKDW :DUIRUG ZDV
&RXUWVSHFLILFDOO\GHFODUHGWKDW                                      NLOOHG RXW RI D VSHFLILF VDWDQLVPUHODWHG PRWLYDWLRQ IRU
                                                                       SHUIRUPLQJDKXPDQVDFULILFH6HH7XUSLQY.DVVXONH
  WKHPHUHLQWURGXFWLRQRIHYLGHQFHWKDWLVFRPSHWHQWDVWR            )GWK&LUKROGLQJDGPLVVLEOHDQ
  RQHGHIHQGDQWDQGLQFRPSHWHQWDVWRWKHRWKHULVQRWLQ              HQWU\ LQ WKH GHIHQGDQWjV GLDU\ GLVSOD\LQJ KHU ORQJLQJV IRU
  DQG RI LWVHOI JURXQGV WR JUDQW D VHYHUDQFH             ZHDOWKEHFDXVHWKHSURVHFXWRUFODLPHGWKDWWKHGHIHQGDQWKDG
  >2@UGLQDULO\WKHUHPXVWEHVRPHDGGLWLRQDOIDFWRUVXFK             DUUDQJHGKHUKXVEDQGjVGHDWKRXWRIDGHVLUHWRFROOHFWRQKLV
  DVWKDWWKHGHIHQGDQWVKDYHDQWDJRQLVWLFGHIHQVHVRUWKDW           OLIHLQVXUDQFH
  WKH HYLGHQFH DV WR RQH GHIHQGDQW WHQGV GLUHFWO\ WR
  LQFULPLQDWHWKHRWKHUHJRQHGHIHQGDQWjVDGPLVVLRQV                 %HFDXVHWKHWHVWLPRQ\DERXWVDWDQLVPZDVEHLQJRIIHUHGIRU
  GLUHFWO\LPSOLFDWHWKHRWKHU                                        WKH SURSHU SXUSRVH RI GHPRQVWUDWLQJ &ODUNjV PRWLYH LW LV
                                                                       VXEMHFW RQO\ WR WKH JHQHUDO VWULFWXUHV OLPLWLQJ DGPLVVLELOLW\
&RPSWRQY&RPPRQZHDOWK6:G.\                   FRQWDLQHGLQ.HQWXFN\5XOHRI(YLGHQFHDUXOHWKDWLV
LQWHUQDOTXRWDWLRQVRPLWWHGDQGEUDFNHWVLQRULJLQDO          VXEVWDQWLDOO\ VLPLODU WR 5XOH  RI WKH )HGHUDO 5XOHV RI
                                                                       (YLGHQFH6HH&RPPRQZHDOWKY(QJOLVK6:G
  +HUH&ODUNSUHVHQWHGQRDGGLWLRQDOIDFWRUV7KHHYLGHQFH           .\5XOHjVEDODQFLQJRIWKHSUREDWLYH
DJDLQVW+DUGLQnKLVVDWDQLFSDUDSKHUQDOLDDQGWKUHDWVDJDLQVW         YDOXHRIVXFKWHVWLPRQ\DJDLQVWWKHGDQJHURIXQIDLUSUHMXGLFH
:DUIRUG n GLG QRW GLUHFWO\ LPSOLFDWH &ODUN LQ +DUGLQjV         LVDWDVNSURSHUO\UHVHUYHGIRUWKHVRXQGGLVFUHWLRQRIWKHWULDO
DFWLRQV$Q\LPSOLFDWLRQRI&ODUNFRPHVLQGLUHFWO\WKURXJK            MXGJH  6HH 5DNH Y &RPPRQZHDOWK  6:G  
&ODUNjV DVVRFLDWLRQ ZLWK +DUGLQ  6HH 6NLQQHU Y                .\
&RPPRQZHDOWK6:G.\KROGLQJWKDWWKH
GHIHQGDQWIDLOHGWRHVWDEOLVKWKDWKHVKRXOGKDYHEHHQWULHG             2XU UHYLHZ DV D KDEHDV FRXUW LV HYHQ PRUH OLPLWHG LQ
VHSDUDWHO\IURPKLVFRGHIHQGDQWVGHVSLWHKLVFRQWHQWLRQWKDW          UHYLHZLQJWKHVWDWHFRXUWjVGHWHUPLQDWLRQm+DEHDVUHYLHZ
KHZDVSUHMXGLFHGE\WKHLQWURGXFWLRQRIHYLGHQFHDERXWKLV            GRHVQRWHQFRPSDVVVWDWHFRXUWVUXOLQJVRQWKHDGPLVVLRQRI
FRGHIHQGDQWVj PLVGHHGV  %HFDXVH WKH GHFLVLRQ RI WKH           HYLGHQFH XQOHVV WKHUH LV D FRQVWLWXWLRQDO YLRODWLRQl
.HQWXFN\6XSUHPH&RXUWLQ&ODUNjVDSSHDOIDOOVZLWKLQWKH              &OHPPRQVY6RZGHUV)GWK&LU1R
UHDOP RI SODXVLEOH DQG FUHGLEOH UHVXOWV DQG LV QRW            VXFK FRQVWLWXWLRQDO YLRODWLRQ H[LVWV KHUH EHFDXVH WKH WULDO
XQUHDVRQDEOHLQLWVDQDO\VLVRIODZRUIDFWZHUHMHFW&ODUNjV         FRXUWjV GHWHUPLQDWLRQ WKDW WHVWLPRQ\ DERXW WKH GHIHQGDQWVj
KDEHDVFKDOOHQJHWRWKHMRLQGHURIKLVWULDOZLWKWKDWRI+DUGLQ      VDWDQLFEHOLHIVZDVPRUHSUREDWLYHWKDQSUHMXGLFLDODSSHDUV
                                                                       UHDVRQDEOH DQG WKHUHIRUH IDU IURP mDQ XQUHDVRQDEOH
' /HWWHUIURP&DSSV                                                  GHWHUPLQDWLRQRIWKHIDFWVLQOLJKWRIWKHHYLGHQFHSUHVHQWHGLQ
                                                                       WKH6WDWHFRXUWSURFHHGLQJl86&G
  )LQDOO\&ODUNDUJXHVWKDWKHZDVGHQLHGDIDLUWULDOEHFDXVH
WKHSURVHFXWLRQIDLOHGWRGLVFORVHDOHWWHUZULWWHQE\&DSSVWR         7KHWHVWLPRQ\DVDOUHDG\GLVFXVVHGZDVSUREDWLYHDVWRWKH
DQRWKHUMDLOLQPDWH.HYLQsXVWLV,QWKLVOHWWHU&DSSVDSSHDUV      PRWLYH WKDW WKH GHIHQGDQWV PLJKW KDYH KDG IRU NLOOLQJ
WR EH XUJLQJ sXVWLV WR FRPPLW SHUMXU\ E\ DVNLQJ sXVWLV WR    :DUIRUG)XUWKHUPRUHWKHOLNHOLKRRGRIXQIDLUSUHMXGLFHZDV
WHVWLI\ WKDW +DUGLQ mMRNLQJO\l DGPLWWHG WR WKH PXUGHU RI
     &ODUNY2j'HD                                  1R       1R                                  &ODUNY2j'HD          

DOOHYLDWHGE\WKHIDFWWKDWWKHGHIHQVHUHPRYHGSRWHQWLDOMXURUV        SURVHFXWLRQ WKH DGPLVVLRQ RI D FRQIHVVLRQ E\ 6KHUOLQjV
ZKRVWDWHGGXULQJWKHLUYRLUGLUHH[DPLQDWLRQVWKDW&ODUNjV           FRGHIHQGDQW GLG QRW YLRODWH 6KHUOLQjV FRQIURQWDWLRQ ULJKWV
SRVVLEOHLQYROYHPHQWLQVDWDQLVPZRXOGDIIHFWWKHLUDELOLW\WR          ZKHUH KLV QDPH ZDV UHGDFWHG IURP WKH FRGHIHQGDQWjV
IDLUO\ DQG LPSDUWLDOO\ WU\ WKH FDVH  $FFRUGLQJO\ ZH UHMHFW   FRQIHVVLRQ DQG WKH FRQIHVVLRQ GLG QRW H[SUHVVO\ LPSOLFDWH
&ODUNjV FKDOOHQJH WR WKH DGPLVVLRQ RI WHVWLPRQ\ DERXW            6KHUOLQ
VDWDQLVP
                                                                           1RFRPSHOOLQJDQGVSHFLILFSUHMXGLFHWR&ODUNjVFDVHKDV
& sRLQGHURI&ODUNjVDQG+DUGLQjVWULDOV                               EHHQ VKRZQ KHUH  &ODUN DQG +DUGLQ GR QRW HYHQ SUHVHQW
                                                                        PXWXDOO\ DQWDJRQLVWLF GHIHQVHV  ,QVWHDG ERWK GHIHQGDQWV
  &ODUNQH[WDUJXHVWKDWKHZDVLPSURSHUO\MRLQHGIRUWULDO             SUHVHQWHGHVVHQWLDOO\WKHVDPHDOLELGHIHQVHWRWKHMXU\nWKDW
ZLWK +DUGLQ  +H DOOHJHV WKDW VWDQGLQJ WULDO ZLWK +DUGLQ       WKH\ZHUHZLWKHDFKRWKHUDWDQRWKHUORFDWLRQRQWKHHYHQLQJ
VXEVWDQWLDOO\SUHMXGLFHGKLPEHFDXVHPRVWRIWKHHYLGHQFHRI           RIWKHPXUGHU$WPRVWWHVWLPRQ\DERXW+DUGLQjVVDWDQLVP
VDWDQLVPUHODWHGRQO\WR+DUGLQDQGQRWWRKLP6SHFLILFDOO\          DQG WKUHDWV WRZDUGV :DUIRUG RQO\ LPSOLFDWH &ODUN E\
WKH SURVHFXWLRQ HOLFLWHG WHVWLPRQ\ DERXW D VNHWFK ERRN RI       DVVRFLDWLRQQRWE\GLUHFWUHIHUHQFH%XWWKHIDFWWKDWWKHUHmLV
VDFULOHJLRXV GUDZLQJV D KDQGZULWWHQ ERRN RI VSHOOV DQG D      DVXEVWDQWLDOGLIIHUHQFHLQWKHDPRXQWRIHYLGHQFHDGGXFHG
VDWDQLFSRHP7KHVHLWHPVKRZHYHUZHUHDOOSRVVHVVLRQVRI            DJDLQVWHDFKGHIHQGDQWLVQRWJURXQGVWRRYHUWXUQDGHQLDO
+DUGLQ QRW &ODUN  6LPLODUO\ &ODUN DUJXHV WKDW WHVWLPRQ\      RI VHYHUDQFH XQOHVV WKHUH LV D VXEVWDQWLDO ULVN WKDW WKH MXU\
DERXWWKHWKUHDWWKDW+DUGLQPDGHWR:DUIRUGUHODWHGRQO\WR            FRXOG QRW FRPSDUWPHQWDOL]H RU GLVWLQJXLVK EHWZHHQ WKH
+DUGLQDQGQRWWRKLPVHOI,QKLVEULHI&ODUNSRLQWVRXWWKDW        HYLGHQFHDJDLQVWHDFKGHIHQGDQWl8QLWHG6WDWHVY/OR\G
WZR RI WKH QLQH MXVWLFHV RI WKH .HQWXFN\ 6XSUHPH &RXUW         )GWK&LULQWHUQDOTXRWDWLRQPDUNVDQG
DJUHHGWKDWKHZDVXQIDLUO\SUHMXGLFHGE\EHLQJWULHGDORQJ             FLWDWLRQRPLWWHGHOOLSVHVLQRULJLQDO
ZLWK+DUGLQ
                                                                          ,Q WKH SUHVHQW FDVH D MXU\ FRXOG HDVLO\ VHSDUDWH WKH
   )RUDGHIHQGDQWWRUHFHLYHKDEHDVUHOLHIKHPXVWVKRZWKDW          WHVWLPRQ\DJDLQVW+DUGLQIURPWKHWHVWLPRQ\DJDLQVW&ODUN
WKHDGMXGLFDWLRQRIKLVFODLPZDVmFRQWUDU\WRFOHDUO\        EHFDXVH WKH WHVWLPRQ\ DERXW +DUGLQjV WKUHDWV DQG VDWDQLF
HVWDEOLVKHG)HGHUDOODZRUUHVXOWHGLQDGHFLVLRQWKDW        SDUDSKHUQDOLDZDVQRWSDUWLFXODUO\FRPSOH[6HHLGDW
ZDVEDVHGRQDQXQUHDVRQDEOHGHWHUPLQDWLRQRIWKHIDFWVLQ              XSKROGLQJ WKH MRLQW WULDO RI VHYHUDO GHIHQGDQWV LQ D
OLJKWRIWKHHYLGHQFHSUHVHQWHGLQWKH6WDWHFRXUWSURFHHGLQJl         SURVHFXWLRQ IRU GUXJ WUDIILFNLQJ EHFDXVH mWKLV FDVH ZKLOH
 86&  G  &ODUN KRZHYHU KDV IDLOHG WR            OHQJWK\ZDVQRWDFDVHRIVXFKFRPSOH[LW\WKDWWKHMXU\FRXOG
GHPRQVWUDWHHLWKHURIWKHVHHOHPHQWV                                   QRWFRPSDUWPHQWDOL]HWKHHYLGHQFHl,QGHHGWKHVWDWHFRXUW
                                                                        KDGDPSOHUHDVRQVWRWU\&ODUNDQG+DUGLQWRJHWKHUEHFDXVH
  7KLV FRXUW KDV KHOG LQ D 6L[WK $PHQGPHQW KDEHDV              WKH\ERWKZHUHFKDUJHGZLWKFRPPLWWLQJWKHVDPHFULPH6HH
FKDOOHQJHWKDWDGHIHQGDQWPXVWVKRZERWKDQDEXVHRI              %XFKDQDQY.HQWXFN\86UHFRJQL]LQJ
GLVFUHWLRQRQWKHSDUWRIWKHWULDOFRXUWDQGFRPSHOOLQJDQG        WKDWWKHVWDWHKDVDQLQWHUHVWLQSURFHHGLQJZLWKMRLQWWULDOV
VSHFLILF SUHMXGLFH LQ RUGHU WR VXFFHVVIXOO\ FKDOOHQJH WKH        ZKHUHmDOORIWKHFULPHVFKDUJHGDJDLQVWWKHMRLQHGGHIHQGDQWV
MRLQGHURIKLVWULDOZLWKWKDWRIDFRGHIHQGDQW6HHsHQNLQVY        DULVH RXW RI RQH FKDLQ RI HYHQWV ZKHUH WKHUH LV D VLQJOH
%RUGHQNLUFKHU  )G   WK &LU                 YLFWLP DQG ZKHUH LQ IDFW WKH GHIHQGDQWV DUH LQGLFWHG RQ
)XUWKHUPRUH ZH KDYH IRXQG QR FRPSHOOLQJ DQG VSHFLILF            VHYHUDORIWKHVDPHFRXQWVl
SUHMXGLFHZKHUHDFRGHIHQGDQWjVWHVWLPRQ\GLGQRWH[SUHVVO\
LPSOLFDWH WKH GHIHQGDQW  6HH 8QLWHG 6WDWHV Y 6KHUOLQ 
)GWK&LUKROGLQJWKDWLQDIHGHUDO