Court Opinion

ID: 2969958
Source: CourtListenerOpinion
Date Created: 2015-09-22 16:01:18.380556+00
Date Added: 2024-06-11T11:43:27.471101
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

,QUHs2+1 : %<5' s5       ;
                     0RYDQW     
                                 
                                     1R
                                 
                                  !
                                 
                                1

              )LOHG6HSWHPEHU

  BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB

    ,17+(0$77(52)s2+1:%<5's5
                     12

  BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
1R                                          ,QUH%\UG            1R                                      ,QUH%\UG       

                                                                                SRLQWVRXWLQKHURSLQLRQXQGHUWKH$QWLWHUURULVP
81,7('67$7(6&28572)$33($/6                                                  DQG(IIHFWLYH'HDWK3HQDOW\$FWRIWKHSDQHOjV
                                                                                GHFLVLRQ GHQ\LQJ %\UGjV VXFFHVVLYH KDEHDV
                   )257+(6,;7+&,5&8,7                                        DSSOLFDWLRQLVQRWmSHUPLWWHGWREHWKHVXEMHFWRID
                     BBBBBBBBBBBBBBBBB                                          SHWLWLRQ IRU UHKHDULQJl  1R  &$
                                                                                6HSW   S  FLWLQJ  8 6 &
 ,QUHs2+1 : %<5' s5               ;                                     E(HG6XSS9$QGHYHQLI
                                                                               %\UG FRXOG VHHN HQ EDQF UHYLHZ WKH &RXUW RI
                      0RYDQW                                                   $SSHDOVZRXOGEHDEOHWRUXOHRQWKHSHWLWLRQZHOO
                                           
                                               1R                     EHIRUH 2FWREHU   ,QGHHG WKH &RXUW RI $SSHDOV
                                           !                                   LVVXHG WKH VWD\ RQ 6HSWHPEHU  DQG E\ WKH YHU\
                                                                               QH[W GD\ WKH FRXUW KDG FRQVLGHUHG DQG UHMHFWHG D
                                          1                                     MXGJHjV UHTXHVWIRUHQEDQFUHFRQVLGHUDWLRQRIWKH
                                                                                VWD\ RUGHU  7KDW OHDYHV WKH UDWLRQDOH WKDW D SDQHO
                                                                                PHPEHU QHHGHG mDGGLWLRQDO WLPH WR FRQVLGHU WKH
                                                                                PDWWHUl2IFRXUVHKRZHYHUWKHSDQHOKDVDOUHDG\
                                                                                LVVXHGLWV RSLQLRQ6HHLQJQRMXVWLILFDWLRQIRUWKH
                    )LOHG6HSWHPEHU                                  VWD\,ZRXOGJUDQWWKH6WDWHjVDSSOLFDWLRQWRYDFDWH
                                                                                WKHVWD\6HH%RZHUVR[Y:LOOLDPV86
%HIRUHs21(668+5+(,15,&+DQG%$7&+(/'(5                                   SHUFXULDPm>,@WLVµSDUWLFXODUO\HJUHJLRXVj
                   &LUFXLWsXGJHV                                              WRHQWHUDVWD\DEVHQWVXEVWDQWLDOJURXQGVIRUUHOLHIl
                       BBBBBBBBBBBBBBBBB                                        FLWLQJ 'HOR Y %ODLU  8 6   SHU
                                                                                FXULDP
  25'(5'(1<,1*s2+1%<5'j6027,2172
'(7(50,1(:+(7+(586&E2)7+(
$('3$$33/,(672+,6&$6($1'*5$17,1*$
7(0325$5< 67$< 2) (;(&87,21 817,/
6(37(0%(5
             BBBBBBBBBBBBBBBBB
  68+5+(,15,&+&LUFXLWsXGJH0RYDQWsRKQ:%\UG
VFKHGXOHG WR EH H[HFXWHG  E\ WKH 6WDWH RI 2KLR RQ
6HSWHPEHU   DW  DP VHHNV D VWD\ RI H[HFXWLRQ
ZKLOHKHSXUVXHVDVHFRQGIHGHUDOKDEHDVSHWLWLRQ %\UGDOVR

    
      %\UG GRHV QRW FKDUDFWHUL]H KLV PRWLRQ DV VXFK 5DWKHU WKH PRWLRQ
LV VW\OHG DV msRKQ %\UGjV 0RWLRQ >WR@ 'HWHUPLQH :KHWKHU  86&
 E RI WKH $('3$ $SSOLHV WR +LV &DVHl $V UHOLHI KH UHTXHVWV WKDW
mWKLV &RXUW >@ GHWHUPLQH WKDW   RI WKH $('3$ GRHV QRW DSSO\ WR
KLPl ,Q WKH DOWHUQDWLYH KH mDVNV WKH &RXUW WR JUDQW D VWD\ DQG UHPDQG KLV
    ,QUH%\UG                                      1R        ,QUH%\UG                                       1R

    7KHWULDOFRXUWDQG2KLR&RXUWRI$SSHDOV               DVNVWKLV&RXUWWRGHWHUPLQHWKDW86&  EWKH
    GLVPLVVHGWKHSHWLWLRQDQGWKH2KLR6XSUHPH&RXUW             $QWL7HUURULVPDQG(IIHFWLYH'HDWK3HQDOW\$FWm$('3$l
    GHQLHGUHYLHZ6WDWHY%\UG1R$XJ           ZKLFK EDUV VHFRQG RU VXFFHVVLYH SHWLWLRQV XQOHVV WKH\ DUH
    %\UGWKHQVRXJKWSHUPLVVLRQWRILOHDVHFRQG            EDVHG RQ IDFWV ZKLFK FRXOG QRW KDYH EHHQ GLVFRYHUHG
    IHGHUDO KDEHDV SHWLWLRQ  7KH &RXUW RI $SSHDOV          SUHYLRXVO\ WKURXJK WKH H[HUFLVH RI GXH GLOLJHQFH GRHV QRW
    GHQLHG%\UGjVUHTXHVWRQ6HSWHPEHUEXWVWD\HG              DSSO\WRKLP)RUWKHIROORZLQJUHDVRQV%\UGjVPRWLRQIRU
    WKH H[HFXWLRQ XQWLO 6HSWHPEHU    2Q             VWD\ RI H[HFXWLRQ LV '(1,(' EXW WKH H[HFXWLRQ ZLOO EH
    6HSWHPEHUWKH&RXUWRI$SSHDOVLVVXHGDQRUGHU             VWD\HGXQWLO6HSWHPEHUXSRQWKHUHTXHVWRIDSDQHO
    VWDWLQJWKDWDPHPEHURIWKHFRXUWKDGUHTXHVWHGWKDW          PHPEHUIRUDGGLWLRQDOWLPHWRFRQVLGHUWKHPDWWHU%\UGjV
    WKHHQEDQFFRXUWGHWHUPLQHZKHWKHUWRYDFDWHWKH              UHTXHVWWRILOHDVHFRQGKDEHDVSHWLWLRQLVDOVR'(1,('DV
    VWD\LVVXHGWKHGD\EHIRUH7KHRUGHUVWDWHGWKDWOHVV        EDUUHGXQGHUERIWKH$('3$
    WKDQ D PDMRULW\ RI WKH FRXUW YRWHG LQ IDYRU RI
    YDFDWLQJ WKH VWD\ DQG mD PDMRULW\ RI WKH DFWLYH                                          ,
    MXGJHVKDYHYRWHGWRH[WHQGWKHVWD\RIH[HFXWLRQ
    XQWLO 2FWREHU  l  1R  &$                 %\UGZDVFRQYLFWHGE\DMXU\DQGVHQWHQFHGLQ+H
    6HSW7KH6WDWHKDVILOHGLQWKLV&RXUWDQ         ZDVRULJLQDOO\VFKHGXOHGWREHH[HFXWHGRQsDQXDU\
    DSSOLFDWLRQWRYDFDWHWKHVWD\JUDQWHGE\WKH&RXUWRI         %\UGjV FRQYLFWLRQV DQG VHQWHQFHV ZHUH XSKHOG RQ GLUHFW
    $SSHDOV                                                       DSSHDOWRWKH2KLR&RXUWRI$SSHDOVVHH6WDWHY%\UG1R&
                                                                    % 2KLR &W $SS )HE   RQ GLUHFW
       7KH&RXUWRI$SSHDOVKDVVWD\HGWKHH[HFXWLRQRI            DSSHDO WR WKH 2KLR 6XSUHPH &RXUW VHH 6WDWH Y %\UG 
    sRKQ %\UG ZLWKRXW DQ\ H[SODQDWLRQ RI D                   1(G  2KLR  DQG WKH 6XSUHPH &RXUW GHQLHG
    FRQVWLWXWLRQDOGHIHFWWKDWZRXOGZDUUDQWWKHLVVXDQFH          FHUWLRUDUL6HH%\UGY2KLR86%\UGDOVR
    RIDVWD\E\DIHGHUDOFRXUW7KHRQO\RSLQLRQLWKDV         ILOHGDPRWLRQIRUDQHZWULDOLQ'HFHPEHUZKLFKWKH
    ZULWWHQFRQYLQFLQJO\FRQFOXGHVWKDWWKHUHLVQREDVLV          WULDO FRXUW GHQLHG LQ 6HSWHPEHU   7KH 2KLR &RXUW RI
    IRUDVWD\7KHRQO\UHDVRQWKH&RXUWRI$SSHDOVKDV          $SSHDOV XSKHOG WKH WULDO FRXUW VHH 6WDWH Y %\UG 1R &
    SURYLGHG IRU JUDQWLQJ WKH VWD\ LV WR JLYH mD SDQHO    2KLR&W$SS)HEDQGWKH2KLR6XSUHPH
    PHPEHUDGGLWLRQDOWLPHWRFRQVLGHUWKHPDWWHUl          &RXUWVXEVHTXHQWO\GHFOLQHGMXULVGLFWLRQ6HH6WDWHY%\UG
    ,QH[WHQGLQJWKHVWD\XQWLO2FWREHUWKHFRXUW         1(G2KLR
    SURYLGHGQRDGGLWLRQDOMXVWLILFDWLRQ%\UGVXUPLVHV
    WKDW WKH &RXUW RI $SSHDOV H[WHQGHG WKH VWD\ WR           ,Q%\UGILOHGKLVILUVWSHWLWLRQIRUVWDWHSRVWFRQYLFWLRQ
    2FWREHUmLQRUGHUWRFRQVLGHUsRKQ%\UGjV3HWLWLRQ           UHOLHI ZKLFK WKH WULDO FRXUW GHQLHG  7KH 2KLR &RXUW RI
    IRU 5HKHDULQJ (Q %DQFl  5HVSRQVH WR 6WDWHjV            $SSHDOVUHYHUVHGLQDQGUHPDQGHGWKHFDVHIRUIXUWKHU
    $SSOLFDWLRQ 6HHNLQJ /LIWLQJ RI 6WD\   %XW WKH
    &RXUW RI $SSHDOVj RUGHU GRHV QRW RIIHU WKLV DV D
    UHDVRQIRUJUDQWLQJWKHVWD\WKHRUGHURQO\DGGVWKDW
    mWKHFOHUNRIWKHFRXUWLVGLUHFWHGWRILOHDQGVXEPLW         FDVH WR WKH GLVWULFW FRXUW IRU DQ HYLGHQWLDU\ KHDULQJ LQWR ZKHWKHU KLV
                                                                   HYLGHQFH PHHWV 6FKOXSjV DFWXDO LQQRFHQFH JDWHZD\ VWDQGDUG IRU ILOLQJ D
    WRWKHFRXUWDQ\SHWLWLRQRIIHUHGE\DSDUW\VHHNLQJ           VHFRQG SHWLWLRQl +H DOVR VWDWHV WKDW m>L@I WKH &RXUW GHWHUPLQHV WKDW
    HQEDQFUHYLHZRIWKHGHFLVLRQRIWKHSDQHOl,QDQ\           E GRHV QRW DSSO\ WR %\UGjV FDVH KH ZLOO LPPHGLDWHO\ ILOH LQ WKH
    HYHQW HQ EDQF FRQVLGHUDWLRQ ZRXOG QRW ZDUUDQW           GLVWULFW FRXUW WKH VHFRQG KDEHDV SHWLWLRQ KH WHQGHUHG WR WKLV PRWLRQl
    JUDQWLQJDVWD\XQWLO2FWREHU$VsXGJH%DWFKHOGHU          +RZHYHU FDVW %\UG LV VHHNLQJ WKH SHUPLVVLRQ UHTXLUHG E\  86&
                                                                    E$ WR ILOH DV VHFRQG KDEHDV SHWLWLRQ
1R                                         ,QUH%\UG            1R                                      ,QUH%\UG      

SURFHHGLQJV  2Q UHPDQG WKH WULDO FRXUW DJDLQ HQWHUHG                              &LWHDV86
VXPPDU\ MXGJPHQW IRU WKH VWDWH DQG %\UG DSSHDOHG  7KH
2KLR &RXUW RI $SSHDOV DIILUPHGVHH 6WDWH Y %\UG 1R &                  'LVVHQWIURPGHQLDORIDSSOLFDWLRQWRYDFDWH
2KLR&W$SS)HEDQGWKH2KLR6XSUHPH
&RXUWGHFOLQHGMXULVGLFWLRQ6HH6WDWHY%\UG1(G                     6835(0(&28572)7+(81,7('
2KLR                                                                          67$7(6
                                                                                                    
  %\UG ILOHG KLV LQLWLDO SHWLWLRQ IRU ZULW RI KDEHDV FRUSXV
XQGHU86&GRQ0DUFK7KHGLVWULFW                                           1R$
FRXUWGHQLHGDQHYLGHQWLDU\KHDULQJDQGKDEHDVUHOLHILQ                                      
%\UGY&ROOLQV1R&VOLSRS6'2KLRsXO\
 %\UG Y &ROOLQV 1R & VOLS RS 1RY           0$5*$5(7%$*/(<:$5'(1Ys2+1:%<5'
  /DVW \HDU RYHU GLVVHQW WKLV &RXUW DIILUPHG WKH                             s5
MXGJPHQWRIWKHGLVWULFWFRXUW%\UGY&ROOLQV)G
WK&LU$GLYLGHGFRXUWGHQLHG%\UGjVSHWLWLRQIRU                       21$33/,&$7,21729$&$7(67$<
UHKHDULQJHQEDQF%\UGY&ROOLQV1RDPHQGHGHQ
EDQF RUGHU  WK &LU $XJ    7KH 8QLWHG 6WDWHV                            >6HSWHPEHU@
6XSUHPH&RXUWGHQLHG%\UGjVSHWLWLRQIRUZULWRIFHUWLRUDULRQ
sDQXDU\%\UGY&ROOLQV867KH                    7KHDSSOLFDWLRQWRYDFDWHWKHVWD\RIH[HFXWLRQRI
GLVWULFW FRXUW VXEVHTXHQWO\ LVVXHG D PDQGDWH GLVPLVVLQJ                  VHQWHQFHRIGHDWKHQWHUHGE\WKH8QLWHG6WDWHV&RXUW
%\UGjVKDEHDVSHWLWLRQRQsDQXDU\                                    RI$SSHDOVIRUWKH6L[WK&LUFXLWSUHVHQWHGWRs867,&(
                                                                               67(9(16DQGE\KLPUHIHUUHGWRWKH&RXUWLVGHQLHG
   2Q sDQXDU\   %\UG ILOHG D PRWLRQ LQ WKH 2KLR
6XSUHPH&RXUWVHHNLQJDVWD\RIH[HFXWLRQWRSHUPLWKLPWR                       &+,() s867,&( 5(+148,67ZLWKZKRPs867,&(
OLWLJDWHWKHLVVXHRIKLVDFWXDOLQQRFHQFHRIWKHGHDWKSHQDOW\               6&$/,$DQGs867,&( 7+20$6MRLQGLVVHQWLQJ
2Q0DUFKWKH2KLR6XSUHPH&RXUWLVVXHGDQHQWU\
SHUPLWWLQJ%\UGWRILOHDVHFRQGVWDWHSRVWFRQYLFWLRQSHWLWLRQ                   sRKQ:%\UGsUZDVVFKHGXOHGWREHH[HFXWHG
LQWKHWULDOFRXUWDQGUHPDQGLQJWKHFDVHIRUDKHDULQJRQWKH                 E\WKH6WDWHRI2KLRWRGD\6HSWHPEHUDWDP
FODLPWKDWKHZDVDFWXDOO\LQQRFHQWRIWKHGHDWKSHQDOW\7KH                 HGW%\UGZDVFRQYLFWHGDQGVHQWHQFHGWRGHDWKLQ
2KLR 6XSUHPH &RXUWjV HQWU\ VHW %\UGjV H[HFXWLRQ GDWH IRU               IRUWKHPXUGHURI0RQWH7HZNVEXU\%\UGjV
6HSWHPEHU6WDWHY%\UG1(G                     FRQYLFWLRQ DQG VHQWHQFH ZDV XSKHOG RQ GLUHFW
                                                                               DSSHDODQGZHGHQLHGFHUWLRUDUL%\UGY2KLR
  %\UG ILOHG D SHWLWLRQ IRU SRVWFRQYLFWLRQ UHOLHI LQ WKH              86,Q%\UGILOHGDSHWLWLRQIRU
+DPLOWRQ&RXQW\2KLRWULDOFRXUWRQ$SULO,QLWKH                 VWDWHSRVWFRQYLFWLRQUHOLHI7KH2KLRFRXUWVGHQLHG
UDLVHGLQWHUDOLDWKHFODLPWKDWKHZDVDFWXDOO\LQQRFHQWRI                 WKHSHWLWLRQ,Q%\UGILOHGDSHWLWLRQIRUZULW
WKH GHDWK SHQDOW\  %\UG EDVHG KLV ILUVW FODLP RQ WKH           RIKDEHDVFRUSXVLQIHGHUDOFRXUW7KHGLVWULFW&RXUW
DIILGDYLW RI FRGHIHQGDQW sRKQ %UHZHU LQ ZKLFK %UHZHU                  DQG&RXUWRI$SSHDOVIRUWKH6L[WK&LUFXLWGLVPLVVHG
                                                                               WKHSHWLWLRQDQGZHDJDLQGHQLHGFHUWLRUDUL%\UGY
                                                                               &ROOLQV86%\UGILOHGDQRWKHU
    
     )RU D WKRURXJK UHYLHZ RI WKH XQGHUO\LQJ HYHQWV VHH %\UG Y &ROOLQV      SHWLWLRQ IRU VWDWH SRVWFRQYLFWLRQ UHOLHI RQ $SULO 
 )G  WK &LU  FHUW GHQLHG  86  
     ,QUH%\UG                                          1R              ,QUH%\UG                                     1R

                         BBBBBBBBBBBBBBB                                      DOOHJHV WKDW KH QRW %\UG DFWXDOO\ PXUGHUHG 0RQWH
                                                                              7HZNVEXU\,QKLVVHFRQGFODLP%\UGDOOHJHGWKDWWKHWULDO
                            ',66(17                                           WHVWLPRQ\RIVWDWHjVZLWQHVV5RQDOG$UPVWHDGDQGWKHJUDQG
                         BBBBBBBBBBBBBBB                                      MXU\ WHVWLPRQ\ RI VWDWH ZLWQHVV 9LUJLO sRUGDQ ZHUH QRW
                                                                              FUHGLEOH  +H DOVR UHTXHVWHG GLVFRYHU\ RI UHFRUGV IURP WKH
  $/,&(0%$7&+(/'(5&LUFXLWsXGJHGLVVHQWLQJIURP                         SURVHFXWRUjVRIILFHDQGWKHVWDWHGHSDUWPHQWRIFRUUHFWLRQV
WKHRUGHUH[WHQGLQJWKHVWD\RIH[HFXWLRQLQZKLFK6,/(5                    7KH WULDO FRXUW GHQLHG %\UGjV GLVFRYHU\ UHTXHVWV DQG
&LUFXLWsXGJHMRLQV                                                         GLVPLVVHG %\UGjV SRVWFRQYLFWLRQ SHWLWLRQ ZLWKRXW DQ
                                                                              HYLGHQWLDU\ KHDULQJ RQ 0D\    6WDWH %\UG 1R %
  7KHRUGHUJUDQWLQJWKHVWD\RIH[HFXWLRQXQWLO2FWREHU                   $+DPLOWRQ&30D\  5HJDUGLQJWKH
VWDWHVm$PDMRULW\RIWKHDFWLYHMXGJHVKDYHYRWHGWR                   %UHZHUDIILGDYLWWKHFRXUWKHOG
H[WHQG WKH VWD\ RI H[HFXWLRQ   l  ,W GRHV QRW VD\ WKDW WKH
UHTXHVWIRUWKLVVWD\ZDVUHIHUUHGWRDOORIWKHDFWLYHMXGJHVRI                 %\UGDQGKLVDWWRUQH\VDJUHHWKDWWKH\UHFHLYHG%UHZHUjV
WKHFRXUW,QIDFWQRVXFKUHTXHVWZDVUHIHUUHGWRPHDWDQ\                    DIILGDYLWLQ)RUWDFWLFDOUHDVRQVWKH\GLGQRW
WLPH5DWKHUWKHUHTXHVWnZKLFKDSSDUHQWO\FDPHQRWIURP                         ILOHWKHDIILGDYLWRUPDNHLWNQRZQWRWKLVRUDQ\FRXUWDW
WKH SHWLWLRQHU EXW IURP sXGJH sRQHVnZDV UHIHUUHG RQO\ WR                  WKDWWLPHHYHQWKRXJK%\UGKDGDPRWLRQIRUDQHZWULDO
WKRVHPHPEHUVRIWKHFRXUWZKRFRXOGEHFRXQWHGXSRQWR                           SHQGLQJ DW WKDW WLPH  %\UG LQ  ZDV SXUVXLQJ DQ
YRWHLQIDYRURIWKHVWD\                                                      DSSHDODQGDPRWLRQIRUQHZWULDOFRQWHQGLQJLQSDUWWKDW
                                                                                  %\UGZDVQRWHYHQDWWKHVFHQHRIWKHFULPHRQWKHQLJKW
  $V EHVW , DP DEOH WR GHWHUPLQH RQH MXGJH RI WKLV FRXUW              LQTXHVWLRQ%UHZHUjVDIILGDYLWSXWV%\UGVTXDUHO\DWWKH
RUDOO\ RUGHUHG WKLV VWD\ WR EH HQWHUHG VWDWLQJ WKDW LW                  FULPHVFHQH
UHSUHVHQWHGWKHYRWHVRIDPDMRULW\RIWKHFRXUW7KHUHZDV
QHYHUDQ\ZULWWHQUHTXHVWIRUDVWD\7KHUHZDVQRZULWWHQ                         $VDFRQVHTXHQFHRIWKLVWDFWLFDOGHFLVLRQE\%\UGDQG
YRWH,QVKRUWWKHUHLVQRUHFRUGRIWKHFDEDOWKDWUHVXOWHGLQ                 KLVDWWRUQH\V%\UGLVQRZEDUUHGXQGHU&ULPLQDO5XOH
WKLVVWD\                                                                      IURPILOLQJDPRWLRQIRUDQHZWULDOEHFDXVHDVKLV
                                                                                  DWWRUQH\FRQFHGHGLQRUDODUJXPHQWWKHDIILGDYLWLV
  7KHUH LV QR URRP IRU DUJXPHQW DERXW ZKHWKHU DOO RI WKH                QRWQHZO\GLVFRYHUHGHYLGHQFH
MXGJHVLQDFWLYHVHUYLFHDUHPHPEHUVRIWKHHQEDQFFRXUW
7KH\DUH6HH86&F,QWKLVFLUFXLWKRZHYHU                        %\UG DQG KLV DWWRUQH\V QRZ LQVLVW WKDW WKH 
RQO\ VRPH RI WKRVH MXGJHV DUH SHUPLWWHG WR KDYH QRWLFH RI               DIILGDYLWLVWUXH7KXV%\UGFRQFHGHVWKDWWKHSRVLWLRQ
UHTXHVWV PDGH WR WKH HQ EDQF FRXUW DQG WR YRWH RQ WKRVH                KHSXUVXHGLQFRXUWIRUVRORQJWKDWKHZDVQRWDWWKH
UHTXHVWV                                                                       FULPHVFHQHLVXQWUXH%\UGQRZFRQFHGHVWKDWKHZDV
                                                                                  WKHUHEXWWKDW%UHZHUQRW%\UGVWDEEHGWKHYLFWLP
   ,ZULWHLQGLVVHQWIURPWKLVSXUSRUWHGRUGHUEHFDXVH,ZDV
JLYHQQRRSSRUWXQLW\WRYRWHRQWKHUHTXHVWIRUWKHVWD\DQG                        7KHDIILGDYLWRI%UHZHULQODFNVDQ\FUHGLELOLW\
,ZLOOQRWEHSDUW\WRHLWKHUWKHSURFHGXUHWKDWSURGXFHGLWRU                   ZKDWVRHYHU7KHDIILGDYLWLVLQFRQVLVWHQWZLWKKLV
WKH SUHFHGHQW WKDW VRPH RI WKH PHPEHUV RI WKLV FRXUW DUH                DIILGDYLWWRVD\QRWKLQJRIKLVVZRUQWHVWLPRQ\DW
DWWHPSWLQJWRVHW                                                                KLV WULDO  $V WKH 6WDWH DFFXUDWHO\ SRLQWV RXW %UHZHU
                                                                                  FRQWLQXHG WR PDNH VWDWHPHQWV LGHQWLI\LQJ %\UG DV WKH
                                                                                  SULQFLSDORIIHQGHUZHOOLQWRKLVSHULRGRILQFDUFHUDWLRQWR
                                                                                  D YDULHW\ RI SHRSOH  7KH %UHZHU DIILGDYLW ODFNV DQ\
1R                                         ,QUH%\UG             1R                                       ,QUH%\UG      

  FUHGLELOLW\IRUDYDULHW\RIUHDVRQVLQFOXGLQJWKRVHFLWHG                 ,WPD\EHWKDW%\UGjVDWWRUQH\VKRXOGEHFHQVXUHGEXWLQWKH
  E\WKH6WDWHGXULQJRUDODUJXPHQW7KHDIILGDYLWVIDLOWR                 HQGWKLVDWWRUQH\KDVmKDGKLVZD\lZLWKWKLV&RXUW
  PHHW WKH VWDQGDUG VHW IRUWK LQ+HUUDUD Y &ROOLQV 
  86                                                           $V,XQGHUVWDQGWKHIDFWVDIHZVHOHFWDFWLYHMXGJHVZHUH
                                                                             FDOOHGE\WHOHSKRQHIRUWKHLUYRWHDQGRWKHUDFWLYHMXGJHVZHUH
7KHWULDOFRXUWUXOHGWKDWWKHFODLPRIDFWXDOLQQRFHQFHEDVHG               QRW,QIDFWDVRIWKLVGDWHWKHUHLVQRWDQ\IRUPDOZULWWHQ
RQ$UPVWHDGjVODFNRIFUHGLELOLW\ZDVEDUUHGE\UHVMXGLFDWD                FRQILUPDWLRQRULGHQWLILFDWLRQRIZKRYRWHG7KHUHZDVQR
                                                                             GLVFXVVLRQDVWRWKHYLHZVDQGRSLQLRQVRIWKHPLQRULW\RIWKH
  7KH 2KLR &RXUW RI $SSHDOV DIILUPHG WKH WULDO FRXUWjV               &RXUWPHPEHUV7KLV&RXUWVKRXOGEHJRYHUQHGE\WKH5XOH
MXGJPHQWRQ$XJXVW6WDWHY%\UG1R&                   RI /DZ DQG SURSHU SURFHGXUHV DUH SDUW RI WKDW FRQFHSW  ,
:/+DPLOWRQ&W$SS$XJSHU                        ZULWHWKLVGLVVHQWLQWKHKRSHWKDWVRPHWKLQJOLNHWKLVQHYHU
FXULDP7KHDSSHDOVFRXUWVWDWHGLQUHOHYDQWSDUW                         KDSSHQVDJDLQLQWKLV&RXUWRULQDQ\RWKHUFRXUW
  ,QKLVILUVWFODLPIRUUHOLHI%\UGFRQWHQGHGWKDWKHZDV
  mDFWXDOO\LQQRFHQWlRIDJJUDYDWHGPXUGHUEHFDXVHKLVFR
  GHIHQGDQWsRKQ%UHZHUNLOOHG7HZNVEXU\%\UGFLWHGWR
  SRUWLRQVRIWKHWULDOWUDQVFULSWDQGPDWHULDODGGXFHGDWKLV
  WULDO WR GHPRQVWUDWH WKDW %UHZHU ZDV WKH NLOOHU  %\UG
  DGGLWLRQDOO\SUHVHQWHGWZRDIILGDYLWVVLJQHGE\%UHZHU
  RQ0D\DQGsDQXDU\UHVSHFWLYHO\LQ
  ZKLFK %UHZHU FODLPHG WKDW KH DQG QRW %\UG IDWDOO\
  VWDEEHG7HZNVEXU\%\UGDOVRSUHVHQWHGWKHDIILGDYLWRI
  'DQ&DKLOODIHOORZLQPDWHRI%UHZHUDWWKH6RXWKHUQ
  2KLR&RUUHFWLRQDO)DFLOLW\ZKRFODLPHGWKDW%UHZHUKDG
  WROGKLPWKDWKHPXUGHUHG7HZNVEXU\
  
  ,Q WKLV FDVH WKH WULDO FRXUW GLVPLVVHG %\UGjV FODLP RI
  mDFWXDOLQQRFHQFHlIRUWZRUHDVRQVILUVWEHFDXVHLWGLG
  QRW JLYH ULVH WR D FRQVWLWXWLRQDO YLRODWLRQ LQ WKH
  SURFHHGLQJVWKDWUHVXOWHGLQKLVFRQYLFWLRQDQGVHFRQG
  EHFDXVH WKH HYLGHQWLDU\ EDVLV IRU WKH FODLPo sRKQ
  %UHZHUjV VWDWHPHQW WKDW KH KDG DFWXDOO\ NLOOHG
  7HZNVEXU\mODFNHG DQ\ FUHGLELOLW\ ZKDWVRHYHUl  :H
  DJUHH:LWKUHVSHFWWRWKHVHFRQGUHDVRQZHQRWH
  XQGHU+HUUDUDVXSUDWKDWWKHHYLGHQWLDU\WKUHVKROGIRU
  DFODLPRIDFWXDOLQQRFHQFHLVmH[WUDRUGLQDULO\KLJKl2Q
  WKH VWDWH RI WKH UHFRUG LQ WKLV FDVH WKH WULDO FRXUW ZDV
  HQWLWOHGWRFRQFOXGHWKDWWKHHYLGHQFHSURYLGHGE\%\UG
  LQWKHDIILGDYLWVIHOOmIDUVKRUWlRIWKDWZKLFKZRXOGKDYH
       ,QUH%\UG                                     1R               ,QUH%\UG                                        1R

                        BBBBBBBBBBBBBBB                                       EHHQQHFHVVDU\WRPDNHRXWDFRJQL]DEOHFRQVWLWXWLRQDO
                                                                              FODLP
                           ',66(17
                        BBBBBBBBBBBBBBB                                   o1(GDWo:/DW
IRRWQRWHRPLWWHG
                                                                          7KH2KLR&RXUWRI$SSHDOVDOVRDJUHHGZLWKWKHWULDOFRXUWjV
  68+5+(,15,&+ &LUFXLW sXGJH GLVVHQWLQJ IURP WKH                   FRQFOXVLRQWKDW%\UGjVVHFRQGFODLPFKDOOHQJLQJ$UPVWHDGjV
UHIXVDO WR YDFDWH WKH SDQHOjV VWD\ DQG GLVVHQWLQJ IURP WKH       FUHGLELOLW\ ZDV EDUUHG E\ UHV MXGLFDWD EHFDXVH LW KDG EHHQ
RUGHUH[WHQGLQJWKHVWD\                                                 UDLVHG DW KLV WULDO RQ DSSHDO LQ KLV ILUVW SRVWFRQYLFWLRQ
                                                                          SHWLWLRQDQGLQIHGHUDOKDEHDVFRUSXVSURFHHGLQJV
  ,ZULWHLQGLVVHQWRIWKHVRFDOOHGHQEDQFFRXUWjVGHFLVLRQ
WRJUDQWDWKLUW\GD\VWD\RIH[HFXWLRQ,GRQRWTXDUUHOWKDW             2Q $XJXVW   WKH 2KLR 6XSUHPH &RXUW GHFOLQHG
DQ\IHGHUDOMXGJHFRXOGJUDQWDVWD\6HH86&              MXULVGLFWLRQDQGGLVPLVVHGWKHDSSHDOmDVQRWLQYROYLQJDQ\
0\SUREOHPLVZLWKWKHmSURFHGXUHlXVHGLQWKLVFDVH                     VXEVWDQWLDOFRQVWLWXWLRQDOTXHVWLRQl6WDWHY%\UG&DVH1R
                                                                          $XJXVW
  $ WKLUW\GD\ VWD\ ZDV JUDQWHG ZLWKRXW DQ\RQH IURP WKH
&RXUWDVNLQJPHDPHPEHURIWKHSDQHOIRUP\RSLQLRQOHW                                                   ,,
DORQHP\YRWH7KLVYRWHZDVQRWDQHQEDQFSURFHGXUHEXW
ZDVGRQHLQVHFUHF\E\VRPHRIWKHDFWLYHPHPEHUVRIWKH                    8QGHUWKH$('3$DSHWLWLRQHULVUHTXLUHGSULRUWRILOLQJ
&RXUW7KHYRWHZDVWDNHQRUDOO\E\WHOHSKRQHDQGQRWE\                 DVHFRQGRUVXFFHVVLYHKDEHDVFRUSXVSHWLWLRQLQWKHGLVWULFW
ZULWWHQUHVSRQVHWRDSHWLWLRQDVLVWKHFXVWRPRIWKLV&RXUW            FRXUW WR VHHN DXWKRUL]DWLRQ mLQ WKH DSSURSULDWH FRXUW RI
7KHUHZDVQRPRWLRQRUIRUPDOUHTXHVWIRUPHWRUHSO\WR,I             DSSHDOVIRUDQRUGHUDXWKRUL]LQJWKHGLVWULFWFRXUWWRFRQVLGHU
DQ\RIWKHsXGJHVYRWLQJKDGERWKHUHGWRUHDGP\RSLQLRQ                 WKHDSSOLFDWLRQl86&E$8QGHUWKH
WKH\ZRXOGNQRZWKDWWKHUHLVDVHULRXVTXHVWLRQDVWRZKHWKHU
WKLVGHFLVLRQFDQHYHQEHUHYLHZHGE\DQHQEDQFFRXUW7KH\                  
DOVRZRXOGNQRZWKDW%\UGjVDWWRUQH\VKDGWKLVDIILGDYLWVLQFH                  8QGHU  86&  E& m>W@KH FRXUW RI DSSHDOV PD\
%\UGZDVXQGHUDQRUGHUE\WKLV&RXUWLQWRUDLVH             DXWKRUL]H WKH ILOLQJ RI D VHFRQG RU VXFFHVVLYH DSSOLFDWLRQ RQO\ LI LW

DQGGLYXOJHDQ\FODLPKHPLJKWKDYH$IWHURUDODUJXPHQW                 GHWHUPLQHV WKDW WKH DSSOLFDWLRQ PDNHV SULPD IDFLH VKRZLQJ WKDW WKH
                                                                          DSSOLFDWLRQ VDWLVILHV WKH UHTXLUHPHQWV RI WKLV VXEVHFWLRQl )XUWKHUPRUH
DQGEHIRUHWKHGHFLVLRQZDVPDGHRQWKHILUVWKDEHDVSHWLWLRQ            m>W@KH JUDQW RU GHQLDO RI DQ DXWKRUL]DWLRQ E\ D FRXUW RI DSSHDOV WR ILOH D
%\UG KDG HLJKWHHQ PRQWKV WR DVN IRU OHDYH WR DPHQG KLV          VHFRQG RU VXFFHVVLYH DSSOLFDWLRQ VKDOO QRW EH DSSHDODEOH DQG VKDOO QRW EH
SHWLWLRQ%\UGjVDWWRUQH\UHSRUWHGWRDQHZVSDSHUWKDWKHZDV            WKH VXEMHFW RI D SHWLWLRQ IRU UHKHDULQJ RU IRU D ZULW RI FHUWLRUDULl 
KROGLQJEDFNRQWKHVRFDOOHGmDFWXDOLQQRFHQFHlDIILGDYLW               86&  E( 6HH DOVR ,Q UH .LQJ  )G  WK &LU
<HW%\UGZDLWHGDOPRVWRQH\HDUDIWHURXUGHFLVLRQZDVILOHG             HQ EDQF KROGLQJ WKDW GHQLDO RI SHUPLVVLRQ WR ILOH D VHFRQG RU
                                                                          VXFFHVVLYH KDEHDV SHWLWLRQ XQGHU $('3$ LV QRW VXEMHFW WR HQ EDQF
DQGDWWKHHOHYHQWKKRXUILOHGWKLVVHFRQGKDEHDVSHWLWLRQ             UHYLHZ $OWKRXJK %\UGjV LQLWLDO IHGHUDO KDEHDV SHWLWLRQ SUHGDWHG WKH
                                                                          HIIHFWLYH GDWH RI WKH $('3$ WKLV DWWHPSW DW ILOLQJ D VHFRQG KDEHDV
                                                                          SHWLWLRQ LV FOHDUO\ JRYHUQHG E\ WKH $('3$ &I 6ODFN Y 0F'DQLHO 
                                                                          86   KROGLQJ WKDW DQ DSSHDO IURP WKH GLVPLVVDO RI D KDEHDV
                                                                          FRUSXV SHWLWLRQ DIWHU WKH HIIHFWLYH GDWH RI WKH $('3$ LV JRYHUQHG E\
     
       , VKRXOG DGG WKDW %\UG HQJDJHG LQ WKH VDPH GHFHLWIXO EHKDYLRU LQ   $('3$ UHJDUGOHVV RI ZKHWKHU WKH KDEHDV SHWLWLRQ ZDV ILOHG LQ WKH GLVWULFW
VWDWH FRXUW $V WKH VWDWH WULDO FRXUW MXGJH QRWHG RQ 0D\   %\UG   FRXUW EHIRUH RU DIWHU $('3$jV HIIHFWLYH GDWH 6HH DOVR 6WHZDUG Y
ZLWKKHOG WKH  DIILGDYLW mHYHQ WKRXJK %\UG KDG D PRWLRQ IRU D QHZ      0DUWLQH]9LOODUHDO  86    QRWLQJ WKDW KDG WKH
WULDO SHQGLQJ DW WKDW WLPHl 6WDWH Y %\UG 1R %$ +DPLOWRQ     SULVRQHUjV FXUUHQW UHTXHVW IRU UHOLHI EHHQ D VHFRQG DSSOLFDWLRQ LW mSODLQO\
&3 0D\                                                         VKRXOG KDYH EHHQ GLVPLVVHGl XQGHU  E RI WKH $('3$ HYHQ
1R                                          ,QUH%\UG            1R                                     ,QUH%\UG     

$('3$DVHFRQGRUVXFFHVVLYHKDEHDVFRUSXVDSSOLFDWLRQ                                            BBBBBBBBBBBBBBB
XQGHUWKDWZDVQRWSUHVHQWHG LQDSULRUDSSOLFDWLRQ
mVKDOOEHGLVPLVVHGXQOHVVlWKHDSSOLFDQWVKRZVmWKHIDFWXDO                                          ',66(17
SUHGLFDWHlIRUKLVQHZFODLPRILQQRFHQFHmFRXOGQRWKDYH                                          BBBBBBBBBBBBBBB
EHHQ GLVFRYHUHG SUHYLRXVO\ WKURXJK WKH H[HUFLVH RI GXH
GLOLJHQFHl RU WKDW WKH FODLP mUHOLHV RQ D QHZ UXOH RI               %2**6&LUFXLWsXGJHGLVVHQWLQJIURP2UGHUH[WHQGLQJ
FRQVWLWXWLRQDO ODZ PDGH UHWURDFWLYH WR FDVHV RQ FROODWHUDO           WKH6WD\RI([HFXWLRQWR2FWREHU
UHYLHZ E\ WKH 6XSUHPH &RXUW WKDW ZDV          SUHYLRXVO\
XQDYDLODEOHl86&$	%                                  2Q WKH DIWHUQRRQ RI 0RQGD\ 6HSWHPEHU  WKLV FRXUW
                                                                             LVVXHGDQRUGHUFRQWDLQLQJWKHODQJXDJHmEXWWKHH[HFXWLRQ
   %\UGGRHVQRWUHO\RQDQHZUXOHRIFRQVWLWXWLRQDOODZDQG                ZLOOEHVWD\HGXQWLO6HSWHPEHUXSRQWKHUHTXHVWRI
KH RSHQO\ DGPLWV WKDW KH FDQQRW HVWDEOLVK WKDW WKH IDFWXDO          DSDQHOPHPEHUl/DWHWKDWGD\,PDGHDUHTXHVWIRUDQ
SUHGLFDWHIRUKLVQHZFODLPLVQHZO\GLVFRYHUHG6HH%\UGjV                 HQEDQFYRWHDQGDYRWLQJEDOORWZDVVHQWRXWE\WKH&OHUN
0HPRUDQGXPLQ6XSSRUWDWmsRKQ%\UGKDVQRWFODLPHG                      WKDWHYHQLQJDVNLQJIRUYRWHVWRmGHWHUPLQHZKHWKHUWRYDFDWH
DQGFRXOGQRWFODLPWKDWKHKDVQHZO\GLVFRYHUHGHYLGHQFHRI                WKHGD\VWD\RIH[HFXWLRQHQWHUHGLQWKLVFDVHl,WZRXOGRI
DFWXDOLQQRFHQFHRIWKHGHDWKSHQDOW\DVGHILQHGLQE                FRXUVHKDYHEHHQDEVXUGIRUVXFKDEDOORWWREHVHQWRXWLIQR
RI $('3$l (PSKDVLV LQ RULJLQDO   7KLV LV WKH FDVH             VWD\ZHUHLQHIIHFW
EHFDXVH%\UGGHOLEHUDWHO\FKRVHQRWWRXVHKLVSURRIRIDFWXDO
LQQRFHQFHo%UHZHUjVVWDWHPHQWVoLQVXSSRUWRIKLVLQLWLDO                    $FDQGLGUHDGHUPD\FRPSDUHWKHDERYHXQGLVSXWHGIDFWV
VWDWHSRVWFRQYLFWLRQSHWLWLRQDQGKHOLNHZLVHFKRVHQRWWR                 ZLWK WKH VWDWHPHQWV LQ WKH DGGHQGD WR sXGJH sRQHVjV
FLWH %UHZHUjV DIILGDYLW LQ KLV ILUVW IHGHUDO KDEHDV SHWLWLRQ        FRQFXUUHQFHZKLFKKHILOHGRQ6HSWHPEHU
7KXV DV %\UG FRQFHGHV KH FDQQRW VDWLVI\  EjV
UHTXLUHPHQWV                                                                7KHDGGHQGDDOVRFRQWDLQVWKHVWDWHPHQWmWKDWDPDMRULW\RI
                                                                             WKHDFWLYHMXGJHVFRQILUPHGE\WKH&OHUNKDGH[SUHVVHGD
   ,QVWHDG KH DUJXHV WKDW XQGHU SUH$('3$ mDEXVH RI WKH             GHVLUHWRMRLQLQWKHWKLUW\GD\VWD\l1RLQIRUPDWLRQKDV
ZULWlGHFLVLRQVKDEHDVSHWLWLRQHUVZHUHDOORZHGWRILOHVHFRQG              FRPHWRP\DWWHQWLRQWRVXJJHVWWKDWWKH&OHUNVRFRQILUPHG
RUVXFFHVVLYHSHWLWLRQVUDLVLQJFODLPVWKDWZHUHRUFRXOGKDYH               WKHSRVLWLRQRIDPDMRULW\RIWKHDFWLYHMXGJHV
EHHQ UDLVHG HDUOLHU ZKHQ WKH SHWLWLRQHU PHW WKH mDFWXDO
LQQRFHQFHIXQGDPHQWDOPLVFDUULDJHRIMXVWLFHlH[FHSWLRQDV
GHILQHGE\WKH6XSUHPH&RXUWLQ0F&OHVNH\Y=DQW86
DQG6FKOXSY'HOR86
%\UG DVVHUWV WKDW WKH SUH$('3$ mDEXVH RI WKH ZULWl
VWDQGDUG UDWKHU WKDQ  E VKRXOG DSSO\ WR KLV FDVH
EHFDXVH KLV LQLWLDO KDEHDV SHWLWLRQ ZDV ILOHG SULRU WR WKH

WKRXJK KLV LQLWLDO IHGHUDO KDEHDV SHWLWLRQ ZDV ILOHG LQ  SULRU WR WKH
HQDFWPHQW RI WKH $('3$

    
     6HFWLRQ E FRQWDLQV D WKLUG EDVLV IRU SHUPLWWLQJ D VHFRQG RU
VXFFHVVLYH SHWLWLRQ WKDW LV QRW UHOHYDQW LQ WKLV FDVH
    ,QUH%\UG                                    1R               ,QUH%\UG                                   1R

WKH VWD\l WKDW HDFK RI WKRVH PDMRULW\ PHPEHUV DFWHG           HIIHFWLYH GDWH RI WKH $('3$ DQG WKH DSSOLFDWLRQ RI WKH
VXEVHTXHQWWRWKHUHTXHVWIRUDYRWHRQYDFDWLQJWKHVWD\,DP      $('3$VWDQGDUGVZRXOGKDYHDQmLPSHUPLVVLEO\UHWURDFWLYH
UHOLDEO\ LQIRUPHG WKDW RQH RU PRUH MXGJHV ZKRVH DSSURYDO      HIIHFWl+HFLWHVRXUGHFLVLRQVLQ,QUH+DQVHUG)G
ZDVUHSUHVHQWHGIRUWKHORQJHUVWD\JDYHVXFKDSSURYDOEHIRUH         WK&LUDQG,QUH6RQVKLQH)GWK&LU
WKHUHKDGEHHQHLWKHUDQ\DFWLRQE\WKHSDQHORUWKHUHTXHVWIRU      LQVXSSRUWRIKLVDUJXPHQW
DYRWHRQYDFDWLQJWKHVWD\
                                                                        2XU LQLWLDO LQTXLU\ LV ZKHWKHU SURYLVLRQV RI WKH $('3$
  )LQDOO\P\LQIRUPDWLRQLVWKDWWKHm&OHUNRI&RXUWVlKDG           DSSO\WRWKLVFDVH6HH,QUH*UHHQ)GWK
UHFHLYHG12FRPPXQLFDWLRQIURPLQGLYLGXDODFWLYHPHPEHUV              &LUSHUFXULDP
RI WKH FRXUW DV WR WKH ORQJHU VWD\  :KDW mLQGLYLGXDO
FRPPXQLFDWLRQZLWKWKH&KLHIsXGJHlPD\KDYHRFFXUUHGLV                  :KHQDFDVHLPSOLFDWHVDIHGHUDOVWDWXWHHQDFWHGDIWHUWKH
DPDWWHUZKLFKWKH&KLHIsXGJHKDV\HWWRFRPPXQLFDWHWRPH              HYHQWVLQVXLWDQG&RQJUHVVKDVQRWH[SUHVVO\SUHVFULEHG
WKHFRXUWJHQHUDOO\RUWRWKH&OHUN                                     WKH VWDWXWHjV SURSHU UHDFK WKH FRXUW PXVW GHWHUPLQH
                                                                          ZKHWKHUWKHQHZVWDWXWHZRXOGKDYHDUHWURDFWLYHHIIHFW
   7KLV W\SH RI VHFUHW XQGRFXPHQWHG GHFLVLRQPDNLQJ E\              LH ZKHWKHU LW ZRXOG LPSDLU ULJKWV D SDUW\ SRVVHVVHG
H[FOXVLYH LQJURXSV LV WKH ZD\ GHFLVLRQV DUH PDGH LQ              ZKHQ KH DFWHG LQFUHDVH D SDUW\jV OLDELOLW\ IRU SDVW
WRWDOLWDULDQFRXQWULHVQRWXVXDOO\LQWKH8QLWHG6WDWHV,WLV          FRQGXFW RU LPSRVH QHZ GXWLHV ZLWK UHVSHFW WR
QHFHVVDU\ WKRXJK KLJKO\ SDLQIXO IRU  PH WR SODFH RQ WKH       WUDQVDFWLRQVDOUHDG\FRPSOHWHG/DQGJUDIY86,)LOP
SXEOLF UHFRUG WKH ZD\ LQ ZKLFK WKLV SXUSRUWHG RUGHU ZDV          3URGV86
LVVXHG DQG WR GLVVHQW IURP WKDW SURFHVV IDU EH\RQG P\
GLVVHQW IURP WKH XQGHUO\LQJ DQG IXQGDPHQWDO ODFN RI OHJDO     ,GDW,Q+DQVHUGZHGHWHUPLQHGWKDW&RQJUHVVKDVQRW
VXSSRUWIRUWKHRUGHU                                                H[SUHVVHGDQ\FOHDULQWHQWDVWRWKHVWDWXWHjVSURSHUUHDFK
                                                                      6HH+DQVHUG)GDW:HPXVWWKHUHIRUHGHWHUPLQH
                                                                      ZKHWKHU WKH SURYLVLRQV RI WKH $('3$ DSSO\ WR WKLV FDVH
                                                                      UHVRUWLQJ WR /DQGJUDIjV GHIDXOW UXOHV WR GHFLGH ZKHWKHU
                                                                      $('3$PD\EHDSSOLHGKHUH6HHLG
                                                                         ,Q+DQVHUGWKHSHWLWLRQHUZKRSOHDGHGJXLOW\WRXVLQJD
                                                                      ILUHDUPLQDGUXJWUDIILFNLQJRIIHQVHLQYLRODWLRQRI86&
                                                                      FILOHGKLVLQLWLDOLQDUJXLQJWKDWKLVGUXJ
                                                                      FRQYLFWLRQYLRODWHGWKH'RXEOHsHRSDUG\&ODXVH7KHGLVWULFW
                                                                      FRXUW GHQLHG WKH PRWLRQ LQ sXO\  DQG ZH DIILUPHG RQ
                                                                      DSSHDO6HH+DQVHUGY8QLWHG6WDWHV)G:/
                                                                       WK &LU sXQH    :KLOH WKDW DSSHDO ZDV
                                                                      SHQGLQJWKH6XSUHPH&RXUWDQQRXQFHGLWVGHFLVLRQLQ%DLOH\
                                                                      Y8QLWHG6WDWHV86RQ'HFHPEHU

                                                                           
                                                                            %\UG OLNHZLVH DFNQRZOHGJHV WKDW WKLV TXHVWLRQ PXVW EH GHFLGHG E\
                                                                                                            6HH +DQVHUG
                                                                      WKLV &RXUW DQG QRW WKH GLVWULFW FRXUW               )G DW 
                                                                      6RQVKLQH     )G DW 
1R                                         ,QUH%\UG           1R                                     ,QUH%\UG     

%DLOH\KHOGWKDWWKHORZHUFRXUWVLQFOXGLQJRXURZQKDGEHHQ               'HQ\WKHPRWLRQWRYDFDWHWKHVWD\RQZKLFKWKHWLPH
VXVWDLQLQJFRQYLFWLRQVXQGHUFIRULQQRFHQWEHKDYLRU                 IRUYRWLQJKDGQRWH[SLUHGDQGRQZKLFKQRPDMRULW\RI
2Q1RYHPEHUDIWHUWKHHIIHFWLYHGDWHRIWKH$('3$                  QHJDWLYH YRWHV KDG EHHQ UHFHLYHG  >7KLV ZDV
+DQVHUGILOHGDPRWLRQZLWKWKLVFRXUWVHHNLQJOHDYHWRILOHD               SURFHGXUDOO\YLUWXDOO\FULPLQDODVWKHRQO\QRWLFHWRWKH
VHFRQGRUVXFFHVVLYHSHWLWLRQLQWKHGLVWULFWFRXUWEDVHGXSRQ               FRXUWLQGLFDWHGWKDWHDFKMXGJHZRXOGKDYHXQWLO30
WKH LQWHUYHQLQJ %DLOH\ GHFLVLRQ  6SHFLILFDOO\ +DQVHUG                WRYRWHDQGE\SUDFWLFHWRFKDQJHKLVRUKHUYRWHZLWKLQ
FODLPHGWKDWXQGHU%DLOH\KHZDVVHUYLQJWLPHIRUFRQGXFW                    WKHVWDWHGWLPH@
WKDWZDVQHYHUDFULPH+DQVHUG)GDW
                                                                             (QWHUDQRUGHUH[WHQGLQJWKHVWD\IRUGD\VEDVHG
   7KXV WKH LVVXH SUHVHQWHG LQ +DQVHUG ZDV mZKHWKHU                  RQ DQ DOOHJHG DJUHHPHQW IURP XQQDPHG MXGJHV WR D
$('3$jVQHZUHVWULFWLRQRQILOLQJPXOWLSOHPRWLRQV                    SURSRVLWLRQZLWKRXWVWDWHGSURFHGXUDOEDVLVZKLFKKDG
µLV WKH W\SH RI SURYLVLRQ WKDW VKRXOG JRYHUQ FDVHV DULVLQJ          QHYHUEHIRUHRUDIWHUEHHQUHGXFHGWRZULWLQJQRUKDGRU
EHIRUHLWVHQDFWPHQWjl,GTXRWLQJ/DQGJUDI86DW                 KDYH LWV VXSSRUWHUV \HW EHHQ LGHQWLILHG QRU UHGXFHG WR
  1RWLQJ WKDW &RQJUHVV KDG QRW H[SUHVVHG DQ\ FOHDU             ZULWLQJQRUKDGWKHSURSRVLWLRQRULWVVXSSRUWEHHQPDGH
DQVZHU WR WKH TXHVWLRQ WKH +DQVHUG FRXUW ORRNHG WR                  DYDLODEOHWRPDQ\SHUKDSVDOOPHPEHUVRIWKHFRXUWDQG
/DQGJUDIjV GHIDXOW UXOHV WR GHFLGH WKH LVVXH  ,G  7KLV
LQYROYHGILUVWGHWHUPLQLQJZKHWKHUWKHQHZOHJLVODWLRQPDNHV                 (QWHUDQRUGHUGLUHFWLQJSURVSHFWLYHO\WKHILOLQJDQG
DQ\FKDQJHVWRWKHFRQWUROOLQJODZDQGVHFRQGZKHWKHULQ                  FLUFXODWLQJRIDQDV\HWXQUHFHLYHGGRFXPHQWSXUSRUWLQJ
OLJKW RI DQ\ FKDQJH DSSO\LQJ WKH UHOHYDQW QHZ ODZ ZRXOG            WREHDQHQEDQFSHWLWLRQLQDFLUFXPVWDQFHZKHUHLWLV
DWWDFKQHZOHJDOFRQVHTXHQFHVWRFRQGXFWSUHGDWLQJWKH$FWjV                 H[WUHPHO\GXELRXVWKDWVXFKDSHWLWLRQLVSHUPLVVLEOH,Q
SDVVDJHVXFKWKDWDSSO\LQJLWZRXOGKDYHDQLPSHUPLVVLEOH                    IDFWXQDQLPRXVGLUHFWSUHFHGHQWRIWKLVFRXUWHQEDQF
UHWURDFWLYHHIIHFW,GDWFLWLQJ/DQGJUDI                      VHH,QUH.LQJ)GWK&LUHQEDQF
                                                                             DQG VWDWXWRU\ DXWKRULW\ DUH VSHFLILF WKDW WKH SHWLWLRQ
  7KH +DQVHUG FRXUW QRWHG WKDW XQGHU SUH$('3$                         ZRXOG EH DQ LPSHUPLVVLEOH DWWHPSW WR REWDLQ HQ EDQF
MXULVSUXGHQFHDIHGHUDOSULVRQHUZKRZLVKHGWRILOHDVHFRQG                FRQVLGHUDWLRQ RI D PDWWHU WKDW LV QRW ZLWKLQ WKH
RUVXEVHTXHQWPRWLRQZDVUHTXLUHG WR SURYHLQWKH                   MXULVGLFWLRQRIWKHHQEDQFFRXUW
GLVWULFWFRXUWHLWKHUWKDWWKHPRWLRQGLGQRWFRQVWLWXWHmDEXVH
RI WKH ZULWl RU WKDW KH KDG PDGH D mFRORUDEOH VKRZLQJ RI          $JDLQ WKLV RUGHU ZDV WR EH HQWHUHG RQ WKH ZRUG RI DQ
IDFWXDO LQQRFHQFHl DV UHTXLUHG E\ 0F&OHVNH\  ,G DW         $UWLFOH,,,MXGJHSXUSRUWLQJWRVSHDNIRUWKH&KLHIsXGJHZLWK
7KH FRXUW GHWHUPLQHG WKDW +DQVHUG VDWLVILHG ERWK RI WKHVH          WKHVXSSRUWRIXQQDPHGMXGJHVZKRVHVXSSRUWKDVQHYHU\HW
FULWHULDEHFDXVHKHFRXOGVKRZERWKmFDXVHlDQGmSUHMXGLFHl               EHHQPHPRULDOL]HGLQZULWLQJXSRQDSURSRVLWLRQQHYHUSXW
IRUIDLOLQJWRUDLVHWKH%DLOH\LVVXHLQWKHILUVWPRWLRQ7KH            EHIRUHWKHRWKHUPHPEHUVRIWKHFRXUWRUUHGXFHGWRZULWLQJ
FRXUW IRXQG WKDW +DQVHUG KDG GHPRQVWUDWHG FDXVH IRU KLV
IDLOXUH WR UDLVH WKH LVVXH LQ KLV ILUVW PRWLRQ EHFDXVH DW WKH     0HPEHUVRIWKHFRXUWPD\LQGHHGDFWLQDQLQIRUPDOPDQQHU
WLPH WKLV &RXUW KDG VXSSRUWHG D EURDG GHILQLWLRQ RI mXVHl        LQUHFRUGLQJWKHLURSLQLRQVXSRQVWDWHGPDWWHUVLQVLWXDWLRQV
XQGHUWKHVWDWXWHDQGKDGVSHFLILFDOO\UHMHFWHGWKHFODLPLQKLV           RIH[WUHPHWLPHSUHVVXUH7KHUHZDVQRVXFKSUHVVXUHDQG
GLUHFW DSSHDO  ,G DW   +DQVHUG DOVR PDGH D VXIILFLHQW     WKHUHZDVQRVWDWHGPDWWHU,WLVVLPSO\DOLHWRVD\WKDWmWKH
VKRZLQJRIERWKSUHMXGLFHDQGDFWXDOLQQRFHQFHEHFDXVHmLW                H[LJHQFLHVRIWKHFLUFXPVWDQFHVUHTXLUHGWKHSURPSWHQWU\RI
DSSHDU>HG@ IURP WKH UHFRUG WKDW KH SOHDGHG JXLOW\ DQG ZDV         WKH2UGHUWRSUHVHUYHWKHVWDWXVTXRl7KHVWDWXVTXRZDV
FRQYLFWHGIRUFRQGXFWWKDWLVXQGHU%DLOH\QRWFULPLQDOl,G           SUHVHUYHGXQWLO6HSWHPEHU,WLVDOVRLQDFFXUDWHWRLQIHU
                                                                           IURPWKHZRUGVm>L@QVWHDGDPDMRULW\IDYRUHGH[WHQGLQJ
          ,QUH%\UG                                        1R            ,QUH%\UG                                       1R

                             BBBBBBBBBBBBBBBB                                    7KH+DQVHUGFRXUWWKHUHIRUHFRQFOXGHGWKDWmXQGHUWKHROG
                                                                                 DEXVHRIWKHZULWVWDQGDUG+DQVHUGZRXOGEHHQWLWOHGWRUDLVH
                                 ',66(17                                         KLV%DLOH\FODLPLQDPRWLRQl,G
                             BBBBBBBBBBBBBBBB
                                                                                    1H[W WKH +DQVHUG FRXUW GHWHUPLQHG WKDW WKH $('3$
  %2**6 &LUFXLW sXGJH GLVVHQWLQJ LQ ZKLFK                                VWDQGDUGZRXOGQRWDOORZVXFKDPRWLRQ7KHFRXUW
68+5+(,15,&+DQG%$7&+(/'(5ssMRLQ,DGGWRP\                             QRWHGWKDWXQGHUWKHQHZODZDSULVRQHUPD\ILOHDVHFRQG
SUHYLRXVGLVVHQWEHFDXVHDQ\IDOVHLPSUHVVLRQVWKDWDUHDGHU                    PRWLRQRQO\LIWKHFRXUWRIDSSHDOVUXOHVWKDWWKHPRWLRQ
PLJKWWDNHIURPRWKHURSLQLRQVRQWKHSXEOLFUHFRUGVKRXOG                       FRQWDLQVQHZO\GLVFRYHUHGHYLGHQFHRULVEDVHGRQDQHZUXOH
QRWVWDQGXQFRUUHFWHG                                                           RIFRQVWLWXWLRQDOODZ7KH+DQVHUGFRXUWREVHUYHGWKDWLQWKH
                                                                                 FDVHVXEMXGLFHWKHUHZDVQRQHZO\GLVFRYHUHGHYLGHQFHDQG
   $YRWLQJEDOORWZDVLVVXHGWRWKHQLQHDFWLYHPHPEHUVRI                      WKDW%DLOH\PHUHO\GHFLGHGWKHSURSHUPHDQLQJRImXVHlXQGHU
WKH FRXUW RQ 0RQGD\ RQ P\ UHTXHVW WR YDFDWH WKH VWD\                   FDQGGLGQRWDQQRXQFHDQHZUXOHRIFRQVWLWXWLRQDO
RULJLQDOO\JUDQWHGE\WKHSDQHO7KDWEDOORWVDLGWKDWYRWHV                    ODZ  ,G DW   8QGHU WKH $('3$ VWDQGDUG +DQVHUGjV
FRXOG EH FDVW DW DQ\ WLPH XS XQWLO  30 7XHVGD\                    UHTXHVWWRILOHWKHPRWLRQZRXOGEHGHQLHG,G7KXV
6HSWHPEHU   $W WKDW SRLQW %\UGjV H[HFXWLRQ ZDV ILUPO\                DSSO\LQJ WKH QHZ VWDWXWH ZRXOG DWWDFK D VHYHUH QHZ OHJDO
VWD\HGXQWLO6HSWHPEHU                                                       FRQVHTXHQFHWRKLVILOLQJDILUVWPRWLRQ+DQVHUGZRXOGKDYH
                                                                                 ORVW WKH ULJKW WR FKDOOHQJH KLV VHQWHQFH  ,G DW   7KH
  6RIDUVRJRRGDWOHDVWSURFHGXUDOO\                                        +DQVHUG FRXUW WKHUHIRUH KHOG WKDW +DQVHUG GLG QRW QHHG
                                                                                 SHUPLVVLRQWRILOHDVHFRQGPRWLRQWRFKDOOHQJHKLVF
  0RQGD\QLJKWZLWKWKHWLPHIRUYRWLQJQRWKDYLQJUXQ                        FRQYLFWLRQVXQGHU86&LQWKHGLVWULFWFRXUW
ZLWKRQO\RQHIRUPDOYRWHQRKDYLQJEHHQUHFHLYHGLQWKH
&OHUNjVRIILFHDQGDGGLWLRQDOQRQRWHVDQG\HVYRWHVVWLOO                     5HO\LQJRQ+DQVHUGWKHPRYDQWLQ6RQVKLQHDUJXHGWKDWKH
WR EH UHFHLYHG 7XHVGD\ PRUQLQJ WKH &OHUN ZDV LQIRUPHG                  VKRXOGEHDOORZHGWRILOHDVHFRQGPRWLRQWRYDFDWHWRUDLVH
YHUEDOO\E\DQ$UWLFOH,,,sXGJHSXUSRUWLQJWRVSHDNIRUWKH                   LQHIIHFWLYH DVVLVWDQFH RI WULDO DQG DSSHOODWH FRXQVHO GXH WR
&KLHIsXGJHWKDWKHVKRXOGHQWHUDQRUGHULPPHGLDWHO\WKH                       WKHLUIDLOXUHWRDGYLVH6RQVKLQHRUWKHGLVWULFWFRXUWWKDWWKH
QH[WPRUQLQJZLWKRXWDQ\SULRUQRWLFHWRWKHUHVWRIWKHFRXUW                 FRXUW ZDV UHTXLUHG WR LPSRVH KLV VHQWHQFHV RQ WZR FRXQWV
WKDWZRXOG                                                                      FRQFXUUHQWO\ ZLWK KLV XQGLVFKDUJHG SULVRQ WHUP  6RQVKLQH
                                                                                 UHOLHGXSRQWKHIROORZLQJSDVVDJHLQ+DQVHUGm:HWKHUHIRUH
                                                                                 KROGWKDWDIHGHUDOSULVRQHUPXVWVDWLVI\WKHQHZUHTXLUHPHQWV
                                                                                 RI  86&RQO\LIKHKDVILOHGDSUHYLRXV
                                                                                 PRWLRQ RQ RU DIWHU $SULO   WKH GDWH $('3$ ZDV
       
           , HPSKDVL]H LQ WKH VWURQJHVW WHUPV WKDW WKH LVVXDQFH RI WKH FRXUWjV
                                                                                 VLJQHGLQWRODZ$V+DQVHUGjVSUHYLRXVPRWLRQZDV
RUGHU KDG 127+,1* WR GR ZLWK WKH WUDJLF HYHQWV RI 7XHVGD\ PRUQLQJ
                                                                                 ILOHG EHIRUH WKDW GDWH KH GRHV QRW QHHG WR PHHW WKLV QHZ
7KH RUGHU WR ILOH WKH RSLQLRQ KDG EHHQ JLYHQ 0RQGD\ QLJKW          :KDWHYHU     VWDQGDUGWRILOHDVHFRQGPRWLRQl6HH6RQVKLQH)GDW
MXGJHV VXSSRUWHG WKDW RUGHU DW WKDW WLPH FRXOG QRW KDYH LQ WKH ZRUGV RI         TXRWLQJ+DQVHUG)GDW6RQVKLQHFODLPHG
sXGJH sRQHV mIHOW LQ WKLV HPHUJHQF\ VLWXDWLRQ D UHDVRQDEOH H[WHQVLRQ WR
                                                                                 WKDWWKLVODQJXDJHLQ+DQVHUGPHDQWWKDWKHGLGQRWQHHGWR
2FWREHU WK ZDV LQ RUGHUl
WKDW
                                 1RU FRXOG WKH\ KDYH EHOLHYHG LQ KLV ZRUGV
       m3HWLWLRQHU IDFHG GHDWK ZLWKLQ WKLUW\VL[ KRXUVl VLQFH D VWD\ ZDV LQ
                                                                                 PHHWWKHQHZJDWHNHHSLQJUHTXLUHPHQWVRI$('3$EHFDXVH
SODFH IRU PRUH WKDQ D ZHHN IURP WKDW WLPH                                       OLNH +DQVHUG KLV ILUVW   PRWLRQ ZDV ILOHG EHIRUH
                                                                                 $SULO+HWKHUHIRUHUHDVRQHGWKDWKHGRHVQRWQHHG
1R                                     ,QUH%\UG       1R                                ,QUH%\UG    

WKLVFRXUWjVDXWKRUL]DWLRQWRILOHDVHFRQGPRWLRQDW         8QGHUWKHVHFLUFXPVWDQFHV
WKLVWLPH
                                                                       HLWKHUWKH6XSUHPH&RXUWPXVWUHYHUVHDWDPLQLPXP
  7KH6RQVKLQHFRXUWUHMHFWHGWKLVUHDGLQJRI+DQVHUG                 WKHH[WHQGHGVWD\
     7DNHQRXWRIFRQWH[WLQWKLVZD\WKHTXRWHGSRUWLRQRI           WKLV FRXUW PXVW DGRSW QHZ FRXUW UXOHV H[SOLFLWO\
  WKH +DQVHUG GHFLVLRQ ZRXOG VHHP DW ILUVW JODQFH WR           DOORZLQJWKLVW\SHRIFXUUHQWO\ODZOHVVDFWLRQRU
  VXSSRUW6RQVKLQHjVSRVLWLRQ6HHDOVR+DQVHUG)G
  DW  m2XU KROGLQJ PHDQV WKDW IHGHUDO LQPDWHV ZLOO         ZHPXVWUHFRJQL]HDQGFRQIHVVWKDWDPDMRULW\RIWKH
  KDYHRQHSRVW$('3$ELWHDWWKHDSSOHOLPLWHGIXUWKHU              FRXUWVLPSO\IHHOVWKDWLWLVQRWERXQGE\ODZZKHQLW
  IRUSULVRQHUVZKRILOHGDPRWLRQEHIRUH$('3$jV               FRPHVWRVRPHGHDWKVHQWHQFHGSULVRQHUV
  HQDFWPHQW E\ WKH ROG DEXVHRIWKHZULW VWDQGDUGl
  6RQVKLQHLVQRZUHTXHVWLQJKLVmRQHSRVW$('3$ELWHDW
  WKHDSSOHl+RZHYHUZKHQUHDGLQWKHFRQWH[WRIWKH
  HQWLUHGHFLVLRQLWLVFOHDUWKDWKLVFDVHLVQRWVXSSRUWHGE\
  +DQVHUG
     7KH VSHFLILF SUREOHP ZH DGGUHVVHG LQ +DQVHUG ZDV
  ZKHWKHUDOHJLWLPDWHFODLPEURXJKWSXUVXDQWWR%DLOH\Y
  8QLWHG6WDWHV86FRXOGEHEURXJKW
  EHIRUHWKHIHGHUDOFRXUWVZKHQWKHPRYDQWKDGDOUHDG\
  SUHVHQWHG D SUH$('3$ SUH%DLOH\ PRWLRQ WR YDFDWH
  XQGHUDQGZRXOGWKXVEHEDUUHGIURPEULQJLQJ
  DQRWKHUPRWLRQE\WKHJDWHNHHSLQJUHTXLUHPHQWV
  VHWXSE\&RQJUHVVLQ$('3$:KLOH%DLOH\LWVHOIZDV
  PHUHO\DGHFLVLRQRIVWDWXWRU\LQWHUSUHWDWLRQPDNLQJLW
  LQHOLJLEOH WR VXSSRUW D VHFRQG   PRWLRQ XQGHU
  $('3$LWUDLVHGFRQFHUQVRIFRQVWLWXWLRQDOGLPHQVLRQ
  DVQXPHURXVLQPDWHVZHUHVHUYLQJPDQGDWRU\SULVRQWLPH
  IRURIIHQVHRIZKLFKWKH\ZHUHDFWXDOO\LQQRFHQW6HH
  7ULHVWPDQ Y 8QLWHG 6WDWHV  )G   G
  &LU+DQVHUG)GDW
     :HWKHUHIRUHDQDO\]HGWKHHIIHFWWKDW$('3$KDGRQ
  D FODLP VXFK DV WKDW UDLVHG E\ +DQVHUG ZKLFK ZRXOG
  KDYH VXUYLYHG WKH ROG mDEXVHRIWKHZULWl WHVW VHH
  0F&OHVNH\Y=DQW86
  XQGHUWKH6XSUHPH&RXUWjVGHFLVLRQLQ/DQGJUDIY86,
  )LOP3URGV86:HFRQFOXGHGWKDW
  $('3$GRHVQRWDSSO\WRDPRYDQWVHHNLQJWRUDLVHD
  %DLOH\FODLPDIWHUKDYLQJILOHGDSUH$('3$PRWLRQWR
    ,QUH%\UG                                    1R           ,QUH%\UG                                    1R

  +RZHYHU , FDQQRW XQGHUVWDQG KRZ D SDQHO FDQ UHQGHU D        YDFDWH EHFDXVH DSSO\LQJ $('3$ ZRXOG KDYH D
GHFLVLRQ RQ WKH PHULWV ZKLFK DIILUPDWLYHO\ ILQGV WKDW WKH      UHWURDFWLYHHIIHFWRQWKHPRYDQWjVSUH$('3$FRQGXFW
SULVRQHUjVFODLPVKDYHQRPHULWDQGWKHQLVVXHDVWD\WRDOORZ         LHKHZRXOGEHEDUUHGIURPILOLQJDVHFRQGPRWLRQWR
RQH PHPEHU RI WKH SDQHO mDGGLWLRQDO WLPH WR FRQVLGHU WKH       YDFDWHXQGHU$('3$ZKHUHDVEHIRUHWKH$FWKHZRXOG
PDWWHUl  :H DUH QRW D mVXSHUFRXUWl WKDW VXSHUYLVHV DOO       KDYHEHHQSHUPLWWHGWRILOHKLVVHFRQGPRWLRQ
H[HFXWLRQV LQ WKH VWDWHV ZLWKLQ RXU MXULVGLFWLRQ  2XU
MXULVGLFWLRQLVOLPLWHGE\&RQVWLWXWLRQDQGVWDWXWH7KHSDQHO            %HFDXVHWKH+DQVHUGFRXUWjV/DQGJUDIDQDO\VLVZDV
KDVGHWHUPLQHGDOOPDWWHUVWKDWFRPHZLWKLQWKDWMXULVGLFWLRQ          EDVHGXSRQWKHUHWURDFWLYHHIIHFWWKDW$('3$KDGRQWKH
                                                                        PRYDQWjVSDUWLFXODUFODLPWKH+DQVHUGKROGLQJPXVWEH
  7KLVFRXUWjVSRZHUWRLVVXHDVWD\ZDVWKHUHIRUHGXELRXVDW           VLPLODUO\FLUFXPVFULEHG&RQVHTXHQWO\ZKLOH+DQVHUG
EHVWDIDFWWKDWWKHSDQHODSSDUHQWO\ODWHUUHFRJQL]HGVLQFHLW       LV QRW VWULFWO\ OLPLWHG WR FODLPV DULVLQJ XQGHU %DLOH\
UHPRYHGDOOUHIHUHQFHWRWKHVWD\IURPLWVDPHQGHGGHFLVLRQ            DSDUWIURPWKDWFODVVRIFODLPVWKHUHZLOOEHIHZRWKHU
&RPSDUH6HSWHPEHU2UGHU'HQ\LQJsRKQ%\UGjV                   FDVHVmLQZKLFKWKHGLIIHUHQFHPDWWHUVl+DQVHUG
0RWLRQ WR 'HWHUPLQH ZKHWKHU  86&  E RI WKH         )G DW  Q DQG RQ ZKLFK WKH JDWHNHHSLQJ
$('3$$SSOLHVWRKLV&DVHDQG*UDQWLQJD7HPSRUDU\6WD\                UHTXLUHPHQWVRI$('3$ZLOOWKXVKDYHDQLPSHUPLVVLEO\
RI([HFXWLRQXQWLO6HSWHPEHUZLWK6HSWHPEHU               UHWURDFWLYHHIIHFW
 2UGHU 'HQ\LQJ sRKQ %\UGjV 0RWLRQ WR 'HWHUPLQH
ZKHWKHU86&ERIWKH$('3$$SSOLHVWRKLV               ,G DW  HPSKDVLV DGGHG  7KH 6RQVKLQH FRXUW
&DVH7KHQKRZHYHUWKHVLWXDWLRQZDVH[DFHUEDWHGZKHQ            FRQFOXGHG 6RQVKLQH ZDV QRW HQWLWOHG WR UHOLHI EHFDXVH WKH
WKHFOHUNRIWKLVFRXUWLVVXHGDPXFKORQJHUVWD\DSSDUHQWO\         LVVXHKHVRXJKWWRUDLVHZDVEDVLFDOO\RQHDULVLQJXQGHUWKH
EDVHGRQWKHZRUGRIRQH$UWLFOH,,,MXGJHWKDWDPDMRULW\RI         6HQWHQFLQJ *XLGHOLQHV ZKLFK ZRXOG EH EDUUHG XQGHU ERWK
WKHDFWLYHPHPEHUVRIWKHFRXUWKDGDSSURYHGLW7KLVDFWZDV        $('3$DQGWKHDEXVHRIWKHZULWVWDQGDUG,G7KHFRXUW
WDNHQ LQ UHVSRQVH WR QR DSSDUHQW PRWLRQ LW KDG QR           IXUWKHUQRWHGWKDW6RQVKLQHZRXOGQRWKDYHSUHYDLOHGXQGHU
MXULVGLFWLRQDOEDVLVDQGLWZDVGRQHZLWKRXWSURYLGLQJDQ\           WKHSUH$('3$ODZEHFDXVHKLVSHWLWLRQZRXOGKDYHEHHQ
QRWLFHWRVRPHPHPEHUVRIWKHFRXUW                                  GHQLHGDVDQDEXVHRIWKHZULW,G7KXVWKH$('3$jVQHZ
                                                                      UHVWULFWLRQV GLG QRW DWWDFK QHZ OHJDO FRQVHTXHQFHV IRU
   :KDWZHKROGDSSDUHQWO\LVWKDWGHDWKVHQWHQFHGSULVRQHUV        6RQVKLQHDQGWKH$('3$KDGQRmLPSHUPLVVLEO\UHWURDFWLYH
QHHGQRWUHVRUWWRFUHDWLYHOHJDOWDFWLFVWRFRPHZLWKLQWKLV         HIIHFWlRQWKHFDVH,G
FRXUWjV MXULVGLFWLRQ  6R SULVRQHUV PD\ ILOH DQ\WKLQJ
UHJDUGOHVVRIVWDWXWHRUSULRUODZDQGWKHHQEDQFFRXUWPD\           7KXVLQ6RQVKLQHWKLV&RXUW FDUHIXOO\OLPLWHG+DQVHUG
VWD\WKHLUH[HFXWLRQIRUDQ\OHQJWKRIWLPHLWFKRRVHV)RU          7KH6RQVKLQHFRXUWVWDWHGWKDWWKHUHWURDFWLYLW\GHWHUPLQDWLRQ
H[DPSOH WKH\ FRXOG ILOH D KRW GRJ PHQX DQG WKH HQ EDQF   LQ+DQVHUGZDVEDVHGRQWKHSDUWLFXODUIDFWVSUHVHQWHGDQG
FRXUWPLJKWXVHWKDWDVDOHJDOEDVLVWRVWD\WKHLUH[HFXWLRQ      ZKLOH+DQVHUGLVQRWVWULFWO\OLPLWHGWRFODLPVDULVLQJXQGHU
                                                                      %DLOH\ mDSDUW IURP WKDW FODVV RI FODLPVl IHZ FDVHV ZLOO
  7KHWUXWKPD\EHWKDWIRUWKLVSULVRQHUDPDMRULW\RIWKH          TXDOLI\ DV WKRVH mLQ ZKLFK WKH GLIIHUHQFH PDWWHUVl DQG WKH
DFWLYHPHPEHUVRIWKLVFRXUWZRXOGJUDQWDVWD\EDVHGRQDKRW        $('3$ZLOOKDYHDQLPSHUPLVVLEO\UHWURDFWLYHHIIHFW
GRJPHQX7KLVKRZHYHULVQRWDFRUUHFWVWDWHPHQWRIWKH
ODZQRULVLWRIDQ\VRUWRIODZDWDOO                               ,Q*UHHQZHUHIXVHGWRDSSO\+DQVHUGZKHUHLWZDVFOHDU
                                                                      IURPWKHUHFRUGWKDWWKHSULVRQHUFRXOGQRWKDYHMXVWLILHGD
                                                                      VHFRQG DFWLRQ XQGHU WKH SUH$('3$ FDXVH DQG SUHMXGLFH
                                                                      VWDQGDUG7KHPRYDQWLQ*UHHQKDGEHHQFRQYLFWHGRIEHLQJ
1R                                      ,QUH%\UG         1R                                       ,QUH%\UG       

DIHORQLQSRVVHVVLRQRIDILUHDUPLQYLRODWLRQRI86&                                  BBBBBBBBBBBBBBB
J*UHHQILOHGKLVILUVWPRWLRQWRYDFDWHXQGHU
RQsXQHZKLFKZDVVXEVHTXHQWO\GHQLHGDVZLWKRXW                                       ',66(17
PHULW+HILOHGDVHFRQGPRWLRQRQ$XJXVW                                    BBBBBBBBBBBBBBB
ZKLFKWKHGLVWULFWFRXUWGHQLHGDVDQDEXVHRIWKHZULW,QKLV
WKLUGPRWLRQ*UHHQDUJXHGWKDWWKHUHKDGEHHQDVXEVWDQWLYH             %2**6 &LUFXLW sXGJH GLVVHQWLQJ IURP WKH UHIXVDO WR
FKDQJHLQWKHODZEDVHGRQ2OG&KLHIY8QLWHG6WDWHV             YDFDWH WKH SDQHOjV VWD\ DQG GLVVHQWLQJ IURP WKH RUGHU
862OG&KLHIKHOGWKDWDGLVWULFWFRXUWDEXVHG         H[WHQGLQJWKHVWD\
LWVGLVFUHWLRQIRUDGPLWWLQJHYLGHQFHRIDSULRUFRQYLFWLRQIRU
WKH VROH SXUSRVH RI VXSSRUWLQJ D  86&  J              7KHSDQHOjVRUGHURI6HSWHPEHU2UGHU'HQ\LQJ
FRQYLFWLRQ DIWHU WKH GHIHQGDQW RIIHUHG WR VWLSXODWH WR WKH    sRKQ %\UGjV 0RWLRQ WR 'HWHUPLQH ZKHWKHU  86&
H[LVWHQFHRIWKHSULRUFRQYLFWLRQ6HH*UHHQ)GDW         E RI WKH $('3$ $SSOLHV WR KLV &DVH DGGUHVVHV
7KH *UHHQ FRXUW KHOG WKDW WKH GHFLVLRQ LQ 2OG &KLHI           %\UGjVVHOIWLWOHGm0RWLRQ>WR@'HWHUPLQH:KHWKHU86&
DQQRXQFHG D mQHZ UXOHlRI FULPLQDO SURFHGXUH DQG ZDV            ERIWKH$('3$DSSOLHVWR+LV&DVHl+RZHYHU
VXEMHFWWRWKHUXOHRI7HDJXHY/DQH86             SURFHGXUDOO\%\UGjVPRWLRQFDQRQO\EHRQHWKLQJLILWLVWREH
KROGLQJWKDWLIDGHFLVLRQDQQRXQFHVDmQHZUXOHlRIFULPLQDO         SURSHUO\ EHIRUH WKLV FRXUW DQ DSSOLFDWLRQ SXUVXDQW WR 
SURFHGXUHLWLVQRWWREHDSSOLHGUHWURDFWLYHO\WRFRQYLFWLRQV        86&E$VHHNLQJSHUPLVVLRQRIWKHFRXUWRI
WKDW KDYH DOUHDG\ EHFRPH ILQDO ZKHQ WKH GHFLVLRQ LV            DSSHDOVWRILOHDVHFRQGKDEHDVSHWLWLRQ7KHSDQHOGHDOWZLWK
DQQRXQFHGVXEMHFWWRFHUWDLQH[FHSWLRQV$VVXFKLWZDVQRW        %\UGjVPRWLRQDVVXFKVHHLGDWQDQGUHQGHUHGDGHFLVLRQ
UHWURDFWLYH DQG ZDV WKHUHIRUH LQDSSOLFDEOH RQ FROODWHUDO         RQWKHPHULWVILUVWKROGLQJWKDWEGRHVDSSO\WR%\UG
UHYLHZ,G                                                           DQGWKHQGHQ\LQJKLVUHTXHVWWRILOHDVHFRQGKDEHDVSHWLWLRQ
                                                                       $QRUGHUVXFKDVWKLVGHQ\LQJSHUPLVVLRQWRILOH DVHFRQG
  0RUHLPSRUWDQWO\WKH*UHHQFRXUWKHOGWKDWUHJDUGOHVVRI            KDEHDVSHWLWLRQLVQRWUHYLHZDEOHHQEDQF6HH,QUH.LQJ
ZKHWKHU 2OG &KLHI DQQRXQFHG D QHZ UXOH WKH JDWHNHHSLQJ        )GWK&LU
SURYLVLRQVRIDSSOLHGWR*UHHQjVFDVHEHFDXVH*UHHQ
ZRXOG QRW KDYH EHHQ DEOH WR HVWDEOLVK FDXVH WR H[FXVH KLV       $OWHUQDWLYHO\WKHSDQHOPD\KDYHIRXQG%\UGH[HPSWIURP
IDLOXUH WR DVVHUW WKLV FODLP LQ KLV ILUVW SUH$('3$     $('3$+RZHYHULQWKDWFDVHWKLVFRXUWZRXOGKDYHQR
PRWLRQ WR YDFDWH  7KH FRXUW UHDVRQHG  m,I2OG &KLHI ZDV    MXULVGLFWLRQ RYHU KLV SHWLWLRQ DV D KDEHDV SHWLWLRQ PXVW EH
GLFWDWHGE\SUHFHGHQWWKHQKLVFODLPZRXOGQRWKDYH EHHQ             ILOHGILUVWLQGLVWULFWFRXUW+DG%\UGJRQHWRGLVWULFWFRXUWLW
FRQVLGHUHG µQRYHOj VR DV WR HVWDEOLVK FDXVH KLV IDLOXUH WR   LV FRQFHLYDEOH WKDW DFWLRQ E\ WKH GLVWULFW FRXUW FRXOG EH
DVVHUWWKLVFODLPLQKLVILUVW PRWLRQWRYDFDWHl,GDW        UHYLHZHGRQDSSHDORUHQEDQF+RZHYHURXUFRXUWFDQQRW
7KH*UHHQFRXUWFRQFOXGHG                                             WDNHMXULVGLFWLRQRYHUDQRQ$('3$KDEHDVSHWLWLRQLQWKH
                                                                       ILUVWLQVWDQFH
  7KXV HYHQ LI 2OG &KLHI GLG QRW DQQRXQFH D QHZ UXOH
  DSSO\LQJ $('3$ WR WKLV FDVH ZRXOG QRW KDYH D                   , FDQ XQGHUVWDQG KRZ D SDQHO IDFHG ZLWK D ODVWPLQXWH
  UHWURDFWLYHHIIHFWRQSUH$('3$FRQGXFW*UHHQZRXOG                PRWLRQDQGRXWRIDQDEXQGDQFHRIFDXWLRQFRXOGVWD\DQ
  KDYH EHHQ EDUUHG IURP DVVHUWLQJ WKLV FODLP LQ D SUH        H[HFXWLRQZKLOHLWLVFRQVLGHULQJWKHPRWLRQ,FDQXQGHUVWDQG
  $('3$ PRWLRQ WR YDFDWH XQGHU WKH DEXVH RI WKH ZULW          ZK\ D PHPEHU RI WKH SDQHO IRU WDFWLFDO RU RWKHU UHDVRQV
  GRFWULQH DV KH ZRXOG QRW KDYH EHHQ DEOH WR HVWDEOLVK       FRXOGUHTXHVWWKDWWKHSDQHOGHIHUDUXOLQJDQGLVVXHDVWD\
  FDXVHWRH[FXVHKLVIDLOXUHWRSUHVHQWWKLVFODLPLQKLV
       ,QUH%\UG                                            1R          ,QUH%\UG                                  1R

   7KLVFDVHKDVVWLUUHGDGLVWXUELQJGHJUHHRIDFULPRQ\ZLWKLQ                  ILUVWPRWLRQWRYDFDWHQRUFRXOGKHKDYHRWKHUZLVHPDGH
WKHFRXUWZKLFKUHIOHFWV WKHSROLWLFL]DWLRQRIWKHLVVXHVE\                   D FRORUDEOH VKRZLQJ RI IDFWXDO LQQRFHQFH  6HH
VRPHSXEOLFRIILFLDOVZLWKPRWLYHVRSHQWRVHULRXVTXHVWLRQ                     0F&OHVNH\Y=DQW86,QUH
,WFUHDWHVDFOLPDWHWKDWsXGJH&UDQFKZDUQHGDERXWLQRQHRI                    +DQVHUG)GDW
WKHPRVWHORTXHQWGLVVHQWVHYHUZULWWHQQHDUO\WZRKXQGUHG
\HDUVDJR                                                                    ,GDW7KHJDWHNHHSLQJSURYLVLRQVLQWKHUHIRUH
                                                                               DSSOLHGWR*UHHQjVFDVH,GDW
    ,Q WLPHV OLNH WKHVH ZKHQ WKH SXEOLF PLQG LV
    DJLWDWHG    LW LV WKH GXW\ RI D FRXUW WR EH SHFXOLDUO\     7KH +DQVHUG H[FHSWLRQ DV FODULILHG E\ 6RQVKLQH DQG
    ZDWFKIXOOHVWWKHSXEOLFIHHOLQJVKRXOGUHDFKWKHVHDWRI                  *UHHQGRHVQRWDSSO\KHUH6RQVKLQHPDNHVFOHDUWKDWWKH
    MXVWLFHDQGWKHUHE\SUHFHGHQWVEHHVWDEOLVKHGZKLFKPD\                   $('3$ JDWHNHHSLQJ SURYLVLRQV RI  E FDQQRW EH
    EHFRPH WKH UHDG\ WRROV RI IDFWLRQ LQ WLPHV PRUH                    DYRLGHGVLPSO\EHFDXVHWKHLQLWLDOKDEHDVSHWLWLRQZDVILOHG
    GLVDVWURXV7KHZRUVWRISUHFHGHQWVPD\EHHVWDEOLVKHG                     SUH$('3$  )XUWKHUPRUH LW LV DSSDUHQW IURP +DQVHUG
    IURPWKHEHVWRIPRWLYHV:HRXJKWWREHRQRXUJXDUG                     6RQVKLQH DQG *UHHQ WKDW WKH H[FHSWLRQ DSSOLHV ZKHUH WKH
    OHVWRXU]HDOIRUSXEOLFLQWHUHVWOHDGXVWRRYHUVWHSWKH                  SHWLWLRQHUZDVXQDEOHEHFDXVHRIWKHWKHQFXUUHQWVWDWHRIWKH
    ERXQGVRIWKHODZDQGWKH&RQVWLWXWLRQIRUDOWKRXJKZH                    ODZWRUDLVHDFODLPLQKLVILUVWIHGHUDOSHWLWLRQ,Q+DQVHUG
    PD\EULQJRQHFULPLQDOWRSXQLVKPHQWZHPD\IXUQLVK                       WKHPRYDQWjVUHTXHVWZDVEDVHGRQDQLQWHUYHQLQJ6XSUHPH
    WKHPHDQVE\ZKLFKDQKXQGUHGLQQRFHQWSHUVRQVPD\                         &RXUW GHFLVLRQ WKDW JDYH WKH PRYDQW DQ DUJXPHQW WKDW KH
    VXIIHU                                                                    FRXOGQRWKDYHSUHYLRXVO\UDLVHGLQKLVLQLWLDOKDEHDVSHWLWLRQ
                                                                               7KXVWKHPRYDQWLQ+DQVHUGKDGFDXVHWRH[FXVHKLVDEXVH
      7KH&RQVWLWXWLRQZDVPDGHIRUWLPHVRIFRPPRWLRQ                        RIWKHZULW+HDOVRREYLRXVO\HVWDEOLVKHGSUHMXGLFHVLQFHWKH
      ,QWKHFDOPRISHDFHDQGSURVSHULW\WKHUHLVVHOGRP                      %DLOH\GHFLVLRQPDGHLWFOHDUWKDW+DQVHUGKDGEHHQFRQYLFWHG
      JUHDW LQMXVWLFH  'DQJHURXV SUHFHGHQWV RFFXU LQ                    IRULQQRFHQWEHKDYLRU7KHPRYDQWVLQ6RQVKLQHDQG*UHHQ
      GDQJHURXV WLPHV ,W WKHQ EHFRPHV WKH GXW\ RI WKH                 FRXOGQRWHVWDEOLVKFDXVHEHFDXVHWKHQHZFODLPVWKH\VRXJKW
      MXGLFLDU\ FDOPO\ WR SRLVH WKH VFDOHV RI MXVWLFH                  WRUDLVHZHUHQRWQHZRUQRYHO
      XQPRYHGE\WKHDUPRISRZHUXQGLVWXUEHGE\WKH
      FODPRURIWKHPXOWLWXGH                                                   8QOLNH WKH SULVRQHU LQ +DQVHUG %\UG ZDV RQ QRWLFH
                                                                               FHUWDLQO\DVHDUO\DVKLVILUVWIHGHUDOKDEHDVSHWLWLRQWKDWKH
  $VWKLVFRXUWSURFHHGVWRH[DPLQHWKHLVVXHVSUHVHQWHGE\                    FRXOG DYDLO KLPVHOI RI WKH DFWXDO LQQRFHQFHIXQGDPHQWDO
WKHSDUWLHVWRWKLVGLVSXWHP\KRSHLVWKDWZHSD\KHHGWRWKH                PLVFDUULDJH RI MXVWLFH H[FHSWLRQ WR H[FXVH DQ\ SURFHGXUDO
ZLVHDGYLFHRIsXGJH&UDQFKWRmFDOPO\SRLVHWKHVFDOHVRI                     GHIDXOW  6HH &ROHPDQ Y 7KRPSVRQ  86  
MXVWLFHl:HDOOVKRXOGEHSUHSDUHGWROLYHZLWKWKHXOWLPDWH                  DFFRUG6DZ\HUY:KLWOH\86
UHVXOW                                                                        'XJJHU Y $GDPV  86   Q  6PLWK Y
                                                                               0XUUD\860XUUD\Y&DUULHU
                                                                               86(QJOHY,VDDF86
                                                                               :DLQZULJKWY6\NHV86VHHDOVR
                                                                               0F&OHVNH\Y=DQW86)XUWKHUPRUH
                                                                               %\UG DOVR KDG WR KDYH NQRZQ WKDW DFWXDO
                                                                               LQQRFHQFHPLVFDUULDJHRIMXVWLFHlH[FHSWLRQH[WHQGVWRDEXVH
                                                                               RIWKHZULW6HH+HUUDUDY&ROOLQV86
                                                                               m,QDVHULHVRIFDVHVFXOPLQDWLQJZLWK6DZ\HUY:KLWOH\
1R                                             ,QUH%\UG            1R                                      ,QUH%\UG       

86GHFLGHGODVW7HUPZHKDYHKHOGWKDWD                                        BBBBBBBBBBBBBBBBBBB
SHWLWLRQHU RWKHUZLVH VXEMHFW WR GHIHQVHV RI DEXVLYH RU
VXFFHVVLYHXVHRIWKHZULWPD\KDYHKLVIHGHUDOFRQVWLWXWLRQDO                                         &21&855(1&(
FODLPFRQVLGHUHGRQWKHPHULWVLIKHPDNHVDSURSHUVKRZLQJ                                          BBBBBBBBBBBBBBBBBBB
RIDFWXDOLQQRFHQFH7KLVUXOHRUIXQGDPHQWDOPLVFDUULDJHRI
MXVWLFHH[FHSWLRQLVJURXQGHGLQWKHmHTXLWDEOHGLVFUHWLRQlRI                    1$7+$1,(/ 5 s21(6 &LUFXLW sXGJH FRQFXUULQJ LQ
KDEHDVFRXUWVWRVHHWKDWIHGHUDOFRQVWLWXWLRQDOHUURUVGRQRW                   2UGHUH[WHQGLQJWKH6WD\RI([HFXWLRQWR2FWREHU
UHVXOWLQWKHLQFDUFHUDWLRQRILQQRFHQWSHUVRQVl6DZ\HU
86m:HKDYHSUHYLRXVO\KHOGWKDWHYHQ                        ,QOLJKWRIsXGJH%RJJVjDPHQGPHQWWRKLVSUHYLRXVGLVVHQW
LI D VWDWH SULVRQHU FDQQRW PHHW WKH FDXVH DQG SUHMXGLFH                 ,PXVWDGGWZRUHEXWWDOVWRDVVHUWLRQVLWFRQWDLQV)LUVWLWV
VWDQGDUGDIHGHUDOFRXUWPD\KHDUWKHPHULWVRIWKHVXFFHVVLYH                  FKDOOHQJHRQWKHEDVLVRIm,WLVVLPSO\DOLHlWKHVWDWHPHQW
FODLPV LI WKH IDLOXUH WR KHDU WKH FODLPV ZRXOG FRQVWLWXWH D            WKDWmWKHH[LJHQFLHVRIWKHFLUFXPVWDQFHVUHTXLUHGWKHSURPSW
mPLVFDUULDJH RI MXVWLFHl  ,Q D WULR RI  GHFLVLRQV                  HQWU\RIWKH2UGHUWRSUHVHUYHWKHVWDWXVTXRlLJQRUHVWKHIDFW
>.XKOPDQQ Y :LOVRQ  86   0XUUD\ Y                      WKDWWKHDWWHPSWE\sXGJH6XKUKHLQULFKWRJUDQWDVWD\XQWLO
&DUULHU86DQG6PLWKY0XUUD\86                      6HSWHPEHU  KDG IDLOHG  1HLWKHU sXGJH %DWFKHOGHU QRU ,
@ZHHODERUDWHGRQWKHPLVFDUULDJHRIMXVWLFH                    FRQFXUUHG LQ WKDW SDUW RI WKH 2UGHU 7KDW PHDQW WKDW WKH
RU mDFWXDO LQQRFHQFHl H[FHSWLRQ  $V ZH H[SODLQHG LQ                    H[HFXWLRQGDWHRI6HSWHPEHUUHPDLQHGLQHIIHFW,GHHPHG
.XKOPDQQWKHH[FHSWLRQGHYHORSHGIURPWKHODQJXDJHRIWKH                       WKDWWREHDQmH[LJHQWFLUFXPVWDQFHl
IHGHUDO KDEHDV VWDWXWH ZKLFK SULRU WR  DOORZHG
VXFFHVVLYHFODLPVWREHGHQLHGZLWKRXWDKHDULQJLIWKHMXGJH                       7KH VHFRQG UHEXWWDO LV QRWH WKDW WKH &OHUN RI &RXUW ZDV
ZHUHmVDWLVILHGWKDWWKHHQGVRIMXVWLFHZLOOQRWEHVHUYHGE\                   XQGHUDFRQWLQXLQJGLUHFWLYHIURPWKH&KLHIsXGJHWRHQWHUD
VXFKLQTXLU\l                                                                  VWD\ 2UGHU KH KDG SUHYLRXVO\ SUHSDUHG DW WKH DSSURSULDWH
                                                                                 WLPH7KH&OHUNRI&RXUWVZDVIXOO\FRJQL]DQWRIWKH&KLHI
   ,QVKRUW%\UGZDVRQQRWLFHDVHDUO\DVWKHILOLQJRIKLV                   sXGJHjVGHVLUHVZLWKUHVSHFWWRWKDW2UGHU:KHQWKH&KLHI
ILUVWIHGHUDOKDEHDVSHWLWLRQLQWKDWKLVDFWXDOLQQRFHQFH                 sXGJH ZDV DGYLVHG WKDW D PDMRULW\ RI WKH DFWLYH MXGJHV
FODLP ZKLFK KH KDG DGPLWWHGO\ NQRZQ DERXW VLQFH                    FRQILUPHGE\WKH&OHUNKDGH[SUHVVHGDGHVLUHWRMRLQLQWKH
FRXOG KDYH EHHQ UDLVHG DQG ZRXOG KDYH H[FXVHG WKH                        WKLUW\ GD\ VWD\ WKH &KLHI sXGJH KDG SUHYLRXVO\ GLUHFWHG EH
SURFHGXUDO GHIDXOW RI IDLOLQJ WR UDLVH LW LQ WKH VWDWH FRXUWV         HQWHUHGDWWKHDSSURSULDWHWLPHWKH&OHUNZDVDGYLVHGWRHQWHU
,QVWHDG%\UGjVDFWXDOLQQRFHQFHFODLPOD\GRUPDQWWKURXJK                       WKH6WD\2UGHUDVPRGLILHGWRUHIOHFWWKHVXSSRUWRIWKHHQ
WKHILOLQJDQGDSSHDORIKLVILUVWIHGHUDOKDEHDVSHWLWLRQDQG                   EDQFPDMRULW\+HZDVWRGRVRmDWWKHGLUHFWLRQRIWKH&KLHI
GHQLDORIFHUWLRUDULQRWWRPHQWLRQERWKWKHVWDWHDSSHOODWH                    sXGJHl
SURFHVV DQG SRVWFRQYLFWLRQ SURFHHGLQJV DQG ZDV QRW
                                                                                    )LQDOO\WKHFRQFXUUHQFHjVUHIHUHQFHWRWKHWUDJLFHYHQWVRI
                                                                                 6HSWHPEHUDQGWKHLUGLVUXSWLYHHIIHFWVRQSURFHHGLQJVRI
    
                                                                                 WKHsXGLFLDO&RQIHUHQFHLQ:DVKLQJWRQDQGDFFHVVWRsXGJH
      %\UG DOVR FRXOG KDYH EURXJKW D VXFFHVVLYH SRVWFRQYLFWLRQ SHWLWLRQ          0DUWLQWKHUHZDVPHDQWRQO\WRQRWHWKHREYLRXV+HVRXJKW
LQ WKH 2KLR FRXUWV  $00 2KLR 5HY &RGH  $ >SUH YHUVLRQ           WRSHUIRUPKLVDGPLQLVWUDWLYHDQGMXGLFLDOGXWLHVRQDQGDIWHU
RI WKH VWDWXWH@ SURYLGLQJ WKDW mWKH FRXUW PD\ LQ LWV GLVFUHWLRQ DQG IRU
                                                                                 6HSWHPEHU  DZD\ IURP KLV &KDPEHUV XQGHU WKH VHYHUH
JRRG FDXVH VKRZQ HQWHUWDLQ D VHFRQG SHWLWLRQ RU VXFFHVVLYH SHWLWLRQ IRU
VLPLODU UHOLHI RQ EHKDOI RI WKH SHWLWLRQHU EDVHG XSRQ WKH VDPH IDFWV RU
                                                                                 KDQGLFDSFUHDWHGE\WKDWWUDJHG\
QHZO\ GLVFRYHUHG HYLGHQFH (PSKDVLV DGGHG )XUWKHUPRUH XQGHU WKH
SULRU YHUVLRQ RI WKH VWDWXWH D SRVWFRQYLFWLRQ SHWLWLRQ FRXOG EH ILOHG mDW DQ\
    ,QUH%\UG                                  1R          ,QUH%\UG                                        1R

DSSURSULDWHO\ LQ WKLV PDWWHU DVVHUWLRQV WR WKH FRQWUDU\   UHVXUUHFWHGXQWLOsDQXDU\QHDUO\WZHOYH\HDUVODWHUDIWHU
QRWZLWKVWDQGLQJ                                                  %\UGDGPLWWHGO\EHFDPHDZDUHRILW7KXVXQOLNHWKHPRYDQW
                                                                  LQ +DQVHUG %\UG FRXOG KDYH UDLVHG KLV DFWXDO LQQRFHQFH
                                                                  FODLPLQKLVILUVWSUH$('3$IHGHUDOKDEHDVSHWLWLRQ$QG
                                                                  %\UG DFWXDOO\ NQHZ WKLV  ,Q DQ m$SSOLFDWLRQ IRU 6WD\ RI
                                                                  3URFHHGLQJV WR $OORZ ,QYHVWLJDWLRQ DQG 'LVFRYHU\ RI
                                                                  3RWHQWLDO&ODLPVDQG)RU/HDYHWR$PHQG3HWLWLRQWR&RPSO\
                                                                  :LWK 0F&OHVN\ Y =DQW  6&W  l ILOHG RQ
                                                                  0DUFKKHVWDWHG
                                                                      :KDW>0F&OHVNH\@PHDQVWR3HWLWLRQHU%\UGLVFOHDU
                                                                    +H ZLOO KDYH RQH FKDQFH WR EULQJ KLV KDEHDV FODLPV
                                                                    EHIRUHWKHIHGHUDOFRXUW+HDQG KLV FRXQVHOKDYHWKH
                                                                    REOLJDWLRQWRSXUVXHDOOSRWHQWLDOFRQVWLWXWLRQDOFODLPVIRU
                                                                    ZKLFKmUHDVRQDEOHLQYHVWLJDWLRQlPD\UHYHDOSUHYLRXVO\
                                                                    XQNQRZQIDFWXDOVXSSRUW
                                                                  )RU WKLV UHDVRQ +DQVHUG DQG SURJHQ\ DUH LQDSSOLFDEOH
                                                                  )XUWKHUPRUHIRUWKHUHDVRQVZHDGGUHVVQH[WSUH$('3$
                                                                  ODZ ZRXOG QRW KDYH HQWLWOHG %\UG WR UDLVH WKH QHZ KDEHDV
                                                                  FODLPVLQDQ\HYHQW7KXVWKHDSSOLFDWLRQRISUH$('3$ODZ
                                                                  ZRXOGQRWEHmDGLIIHUHQFHWKDWPDWWHUVlHQWLWOLQJ%\UGWRSUH
                                                                  $('3$VWDQGDUGVXQGHUD/DQGJUDIDQDO\VLV

                                                                  WLPHl 2KLR 5HY &RGH   6HH DOVR 6WDWH Y %\UG 1R &
                                                                  o 1(G o   :/  2KLR &W $SS $XJ   SHU
                                                                  FXULDP
                                                                       $V WKH 2KLR &RXUW RI $SSHDOV QRWHG LQ LWV GHQLDO RI %\UGjV DSSHDO RI
                                                                  WKH VWDWH WULDO FRXUWjV GHQLDO RI KLV VXFFHVVLYH SRVWFRQYLFWLRQ SHWLWLRQ
                                                                       >%\UGjV@ DWWRUQH\V DFNQRZOHGJH WKDW VLQFH  WKH\ KDYH EHHQ
                                                                       LQ SRVVHVVLRQ RI DQ DIILGDYLW IURP FRGHIHQGDQW sRKQ %UHZHU
                                                                       VWDWLQJ WKDW KH DQG QRW %\UG IDWDOO\ VWDEEHG 7HZNVEXU\ 7KXV
                                                                       %\UG FDQQRW VKRZ WKDW KH ZDV mXQDYRLGDEO\l SUHYHQWHG IURP
                                                                       SUHVHQWLQJ LQ D SRVWFRQYLFWLRQ SHWLWLRQ KLV FODLP RI mDFWXDO
                                                                       LQQRFHQFHl
                                                                  %\UG :/  DW 
 
1R                                     ,QUH%\UG         1R                                        ,QUH%\UG       

                               ,,,                                   SROOLQJ RFFXUV  ,W LV QRW D FROODERUDWLYH SURFHVV QRU LV D
                                                                      SOHQDU\VHVVLRQUHTXLUHGsXGJHVDUHSROOHGLQDYDULHW\RI
                                $                                    ZD\VIRUWKH\DUHRIWHQLQORFDWLRQVUHPRWHIURPWKHVHDWRI
                                                                      WKH FRXUW 2Q QXPHURXV RFFDVLRQV WKLV FRXUW IDFHG ZLWK
   (YHQ LI SUH$('3$ ODZ DSSOLHG WR %\UGjV FDVH %\UGjV       XUJHQWGHDGOLQHVLQGHDWKSHQDOW\DQGRWKHUFDVHVKDVQHHGHG
FODLP IDLOV  )LUVW DQG IRUHPRVW %\UGjV FDVH LV WKH        WR PDNH FRQWDFW E\ WHOHSKRQH DQG WKH RWKHU H[SHGLWLRXV
TXLQWHVVHQWLDODEXVHRIWKHZULWDV%\UGUHDGLO\FRQFHGHV        PHWKRGVRIFRPPXQLFDWLRQLQRUGHUWRDVFHUWDLQWKHZLOORI
KHGHOLEHUDWHO\ZLWKKHOGKLVDFWXDOLQQRFHQFHFODLPIURPKLV          LQGLYLGXDOMXGJHV
ILUVWIHGHUDOKDEHDVSHWLWLRQ
                                                                        0RUHRYHUWKHVLJQLILFDQFHRIWKHIDFWWKDWWKLVSURFHVVWRRN
  7KXVIRUH[DPSOHLIDSULVRQHUGHOLEHUDWHO\ZLWKKROGV             SODFHLQWKHPLGVWRIWKHFDWDVWURSKLFHYHQWVRI6HSWHPEHU
  RQHRIWZRJURXQGVIRUIHGHUDOFROODWHUDOUHOLHIDWWKHWLPH        VKRXOGQRWEHORVWRQP\FROOHDJXHV2QWKDWGD\WKH&KLHI
  RIILOLQJKLVILUVWDSSOLFDWLRQLQWKHKRSHRIEHLQJJUDQWHG       sXGJH ZDV DZD\ IURP KLV KRPH FKDPEHUV LQ :DVKLQJWRQ
  WZR KHDULQJV UDWKHU WKDQ RQH RU IRU VRPH RWKHU VXFK        '& DWWHQGLQJ VHVVLRQV RI WKH sXGLFLDO &RQIHUHQFH RI WKH
  UHDVRQKHPD\EHGHHPHGWRKDYHZDLYHGKLVULJKWWRD              8QLWHG 6WDWHV  (YHU\WKLQJ LQ RXU QDWLRQjV &DSLWDO ZDV
  KHDULQJRQDVHFRQGDSSOLFDWLRQSUHVHQWLQJWKHZLWKKHOG             GLVUXSWHGWKDWGD\QHFHVVLWDWLQJHYHQDQHYDFXDWLRQRIWKH
  JURXQG1RWKLQJLQWKHWUDGLWLRQVRIKDEHDVFRUSXV           sXGLFLDO&RQIHUHQFH1RWZLWKVWDQGLQJWKHGLIILFXOWLHVRIWKH
  UHTXLUHVWKHIHGHUDOFRXUWVWRWROHUDWHQHHGOHVVSLHFHPHDO         PRPHQWWKH&KLHIsXGJHZDVDEOHWRXVHWKHPHDQVDYDLODEOH
  OLWLJDWLRQ RU WR HQWHUWDLQ FROODWHUDO SURFHHGLQJV ZKRVH      WR KLP WR FRQGXFW WKH DIIDLUV RI WKLV FRXUW DQG GLG VR
  RQO\SXUSRVHLVWRYH[KDUDVVRUGHOD\                           DSSURSULDWHO\
6DQGHUVY8QLWHG6WDWHV86FRQVWUXLQJ             $QDFWLRQLVWDNHQLQWKHQDPHRIWKHHQEDQFFRXUWZKHQD
 YHUVLRQ RI  KROGLQJ WKDW QHZFODLP VXFFHVVLYH       PDMRULW\ RI WKH MXGJHV LQ mUHJXODU DFWLYH VHUYLFHl YRWHV D
SHWLWLRQVZHUHEDUUHGmRQO\LIWKHUHKDGEHHQVRPHDEXVHRI           SDUWLFXODU ZD\ RQ D SDUWLFXODU LVVXH  7KH PHWKRG RI
WKH ZULWl ZKLFK WKH &RXUW GHVFULEHG DV DERYH  6HH DOVR   DVFHUWDLQLQJYLHZVLVQRWSUHVFULEHG:KHQDPDMRULW\RIWKH
8QLWHG 6WDWHV Y 0DF'RQDOG  )G   WK &LU      DFWLYH MXGJHV UHJLVWHUHG WKHLU SUHIHUHQFH  o  E\ ZKDWHYHU
 KROGLQJ WKDW GHIHQVH FRXQVHOjV VWUDWHJLF GHFLVLRQ WR    PHDQVoWKHUHTXLUHPHQWZDVPHW,WVKRXOGEHQRWHGWKDW
ZLWKKROGFHUWDLQHYLGHQFHGLGQRWDPRXQWWRFDXVHVWDWLQJ            QRQHRIWKHHQEDQFPDMRULW\KDVTXHVWLRQHGWKHSURFHGXUHV
WKDWm>V@XFKGHOLEHUDWHE\SDVVFOHDUO\FDQQRWVXUYLYHDEXVHRI       WKDWOHGWRWKHILOLQJRIWKHVWD\RUGHU
WKH ZULW DQDO\VLV RQ D VHFRQG KDEHDV DSSHDOl FLWLQJ
0F&OHVNH\*XQQY1HZVRPH)GWK&LU               $W DSSUR[LPDWHO\ WKH VDPH WLPH WKH 6WDWH RI 2KLR
m,IWKHSHWLWLRQHUNQRZLQJO\DQGGHOLEHUDWHO\ZLWKKHOG         SUHVHQWHG DQ DSSOLFDWLRQ WR 8QLWHG 6WDWHV 6XSUHPH &RXUW
WKHFODLPIURPDSULRUSHWLWLRQWKHQKHKDVDEXVHGWKHZULWl      sXVWLFH 6WHYHQV DV &LUFXLW sXVWLFH VHHNLQJ WR KDYH WKH
)XUWKHUPRUHDVWKH6XSUHPH&RXUWjVGLVFXVVLRQLQ0F&OHVNH\           6XSUHPH &RXUW YDFDWH WKH HQODUJHG HQ EDQF VWD\  8SRQ
RIWKHKLVWRU\RIWKHDEXVHRIWKHZULWGRFWULQHPDNHVFOHDU         UHIHUUDO WR WKH HQWLUH 6XSUHPH &RXUW WKH DSSOLFDWLRQ ZDV
%\UGjVGHOLEHUDWHDEDQGRQPHQWRIKLVDFWXDOLQQRFHQFHFODLP          GHQLHGZLWKWKUHHMXVWLFHVLQGLVVHQW
DOWKRXJKQRWWKHRQO\H[DPSOHRIFRQGXFWWKDWGLVHQWLWOHGD
SHWLWLRQHUWRUHOLHILVWKHFODVVLFRQH6HH0F&OHVNH\           $PDMRULW\RIWKHDFWLYHMXGJHVRIWKLVFRXUWIHOWWKDWLQWKLV
86 DW  GLVFXVVLQJ WKH RULJLQV DQG PHDQLQJ RI WKH    HPHUJHQF\VLWXDWLRQDUHDVRQDEOHH[WHQVLRQWR2FWREHUWK
DEXVHRIWKHZULWGRFWULQH                                          ZDVLQRUGHU6L[MXVWLFHVRIWKH8QLWHG6WDWHV6XSUHPH&RXUW
                                                                      YRWHGQRWWRGLVWXUEWKDWGHFLVLRQ7KLVFRXUWFOHDUO\DFWHG
     ,QUH%\UG                                      1R              ,QUH%\UG                                      1R

WKDW LQ WKH LQWHUHVWV RI MXVWLFH DQG IXQGDPHQWDO IDLUQHVV         %\UGDFNQRZOHGJHVWKDWKHKDGLQKLVSRVVHVVLRQVLQFH
UHJDUGLQJWKLVPRVWILQDODQGLUUHYHUVLEOHRISXQLVKPHQWV,            WKHDIILGDYLWRIFRGHIHQGDQW%UHZHUZKLFKKHFRXOGKDYH
ZDVFRPSHOOHGWRVHHNWKHORQJHUVWD\                                  XVHGLQVXSSRUWRIKLVHDUOLHUFODLPWKDW$UPVWHDGjVWHVWLPRQ\
                                                                        ZDV SHUMXUHG  +H KDV VDW RQ WKLV HYLGHQFH OLNH D FKLFNHQ
   ,WKHQVSRNHZLWK&KLHIsXGJH0DUWLQDQGDPDMRULW\RIWKH           ZDLWLQJIRUDQHJJWRKDWFKIRUWZHOYH\HDUVGHVSLWHUHSHDWHG
DFWLYHMXGJHV,H[SUHVVHGWRHDFKP\YLHZVDQGXUJHGWKHP            FRQWDFWZLWKERWKWKHVWDWHDQGIHGHUDOFRXUWV7KHUHLVVLPSO\
WRFRQVLGHUP\GLVVHQWWRWKHSDQHOPDMRULW\jVSURSRVHGRUGHU           QROHJDOH[FXVHIRUWKLVFRQGXFW
UHIXVLQJ UHDOLVWLF UHOLHI IRU WKH 3HWLWLRQHU ZKR IDFHG GHDWK
ZLWKLQWKLUW\VL[KRXUV'LVFXVVLRQVEHWZHHQMXGJHVRIWKLV               :KDWPDNHV%\UGjVDEXVHRIWKHZULWHYHQPRUHRXWUDJHRXV
FRXUW DUH QRWKLQJ QHZ HVSHFLDOO\ LQ HPHUJHQF\ VLWXDWLRQV        LV WKH IDFW WKLV &RXUW DFWXDOO\ JDYH KLP WKH RSSRUWXQLW\ o
VXFKDVWKHRQHLQYROYHGKHUH0U%\UGZDVVFKHGXOHGIRU              LQGHHGGLUHFWLYHoWRUDLVHKLVDFWXDOLQQRFHQFHFODLP:KHQ
H[HFXWLRQDWDP6HSWHPEHUsXGJH6XKUKHLQULFKjV             ZHJUDQWHGDVWD\RIH[HFXWLRQIROORZLQJWKHGLVWULFWFRXUWjV
SURSRVHG2UGHUZDVUHFHLYHGLQFKDPEHUVDWSPRQWKH             LQLWLDOGHQLDOLQRI%\UGjVILUVWKDEHDVSHWLWLRQ
DIWHUQRRQ RI 6HSWHPEHU    +RZHYHU EHIRUH , KDG
IRUPDOL]HGDVWD\PRWLRQRQ6HSWHPEHUsXGJH%RJJVD                 >D@PRQJRWKHUWKLQJVRXURUGHUJUDQWHG3HWLWLRQHUm
QRQSDQHOPHPEHULQWHUFHGHGE\ILOLQJDQREMHFWLRQWRWKH                GD\VWRDOORZIRUIXUWKHULQYHVWLJDWLRQDQGGLVFRYHU\RI
HLJKWGD\VWD\SURSRVHGE\sXGJH6XKUKHLQULFKDQGVRXJKWWR               SRVVLEOHKDEHDVFODLPVlLGDW>&ROOLQVY%\UG
KDYHWKHHQEDQFFRXUWYDFDWHWKHVWD\sXGJH%RJJVDOVR                866FDOLDsGLVVHQWLQJIURPGHQLDO
UHTXHVWHGDSROOLQJRIWKHDFWLYHMXGJHVEHWDNHQE\WKH&OHUN            RIWKH DSSOLFDWLRQWRYDFDWHVWD\RIH[HFXWLRQ@DV
RI&RXUWVUHJDUGLQJWKHVWD\                                             ZHOODVmOHDYHWRDPHQGWKHSHWLWLRQZLWKLQVL[W\
                                                                          GD\V RI WKLV RUGHU WR LQFOXGH DQ\ QHZO\ GLVFRYHUHG
   7KH HQ EDQF FRXUW ZDV WKXV DFWLYDWHG E\ sXGJH %RJJVjV         FODLPV>@,GDW>@
UHTXHVWm2QO\6L[WK&LUFXLWMXGJHVLQUHJXODUDFWLYHVHUYLFH
PD\FDVWYRWHVRQlDQHQEDQFSROO6L[WK&LUFXLW,QWHUQDO             %\UG)GDWHPSKDVLVDGGHG%\UGVDWRQWKLV
2SHUDWLQJ3URFHGXUHD,QUHVSRQVHWRsXGJH%RJJVjV               HYLGHQFH GHVSLWH WKH H[SOLFLW  RSSRUWXQLW\ DQG H[SUHVV
LQWHUYHQWLRQVHHNLQJWRYDFDWHWKHHLJKWGD\VWD\ZKHQSROOHG         LQVWUXFWLRQWRUDLVHmDQ\QHZO\GLVFRYHUHGFODLPVl,QOLJKWRI
OHVV WKDQ D PDMRULW\ RI WKH HQ EDQF FRXUW IDYRUHG KLV         WKLV SULRU RUGHU %\UGjV GHOLEHUDWH VLOHQFH WKHQ DQG EUD]HQ
DSSOLFDWLRQ,QVWHDGLQLQGLYLGXDOFRPPXQLFDWLRQZLWKWKH             DWWHPSWQRZWRDVVHUWWKHFODLPLVQRWKLQJVKRUWRIIUDXGRQ
&KLHIsXGJHDQGRUWKH&OHUNRI&RXUWVDPDMRULW\IDYRUHG              WKLV&RXUW
H[WHQGLQJWKHVWD\WR2FWREHUSXUVXDQWWRDGLUHFWLYH
WRWKH&OHUNRI&RXUWVE\WKH&KLHIsXGJHDQ2UGHUWRWKLV
HIIHFW ZDV ILOHG RQ 6HSWHPEHU   7KH H[LJHQFLHV RI WKH           
                                                                              %\UG ILOHG KLV IHGHUDO KDEHDV SHWLWLRQ RQ 0DUFK   RQO\ HLJKW
FLUFXPVWDQFHV UHTXLUHG WKH SURPSW HQWU\ RI WKH 2UGHU WR         GD\V EHIRUH KLV VFKHGXOHG H[HFXWLRQ %\UG ILOHG D SHWLWLRQ IRU ZULW RI
SUHVHUYHWKHVWDWXVTXR                                              KDEHDV FRUSXV SXUVXDQW WR  86&   7KH GLVWULFW FRXUW UHMHFWHG
                                                                        %\UGjV KDEHDV SHWLWLRQ RQ JURXQGV RI LQH[FXVDEOH GHOD\ :H JUDQWHG D
  7KHUH ZDV QRWKLQJ VHFUHWLYH RU P\VWHULRXV DERXW WKH            VWD\ RI H[HFXWLRQ KRZHYHU 7KH 6WDWH ILOHG DQ DSSOLFDWLRQ WR YDFDWH WKH
SURFHGXUH  sXGJH 6XKUKHLQULFK VWDWHV LQ KLV GLVVHQW WKDW       VWD\ RI H[HFXWLRQ LQ WKH 8QLWHG 6WDWHV 6XSUHPH &RXUW ZKLFK ZDV GHQLHG

m>7@KHUHZDVQRGLVFXVVLRQDVWRWKHYLHZVDQGRSLQLRQVRI              E\ sXVWLFH 6WHYHQV RYHU sXVWLFH 6FDOLDjV GLVVHQW 2XU RUGHU VWD\HG %\UGjV
                                                                        H[HFXWLRQ IRU m GD\V WR DOORZ IRU IXUWKHU LQYHVWLJDWLRQ DQG GLVFRYHU\
WKHPLQRULW\RIWKH&RXUWPHPEHUVl7KHVHYLHZVZHUHTXLWH             RI SRVVLEOH KDEHDV FODLPVl 6HH &ROOLQV Y %\UG  86  
ZHOONQRZQE\YLUWXHRIWKHSDQHO2SLQLRQDQGWKHILOLQJRI             6FDOLD s GLVVHQWLQJ VHH DOVR %\UG Y &ROOLQV  )G )G  
WKHREMHFWLRQ7KHUHVHOGRPLVDMRLQWGLVFXVVLRQZKHQWKH             WK &LU  FHUW GHQLHG  86  
1R                                       ,QUH%\UG        1R                                          ,QUH%\UG        

  ,QVKRUW%\UGXWWHUO\IDLOVWRHVWDEOLVKFDXVHWRH[FXVHKLV                     BBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
DEXVHRIWKHZULW7KXV%\UGFDQQRWSUHYDLOHYHQXQGHUWKH
SUH$('3$FDXVHDQGSUHMXGLFHWHVWH[FXVLQJDQDEXVHRIWKH                           $0(1'('&21&855(1&(
ZULW                                                                             BBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
                                 %
                                                                         1$7+$1,(/5s21(6&LUFXLWsXGJHFRQFXUULQJZLWK
  (YHQ ZKHUH WKH SHWLWLRQHU LV XQDEOH WR VKRZ FDXVH DQG       WKHRUGHUJUDQWLQJWKHVWD\RIH[HFXWLRQWR2FWREHULQ
SUHMXGLFHWRH[FXVHWKHDEXVHRIWKHZULWKHPD\\HWEHDEOH          ZKLFK&2/(&LUFXLWsXGJHMRLQV
WR H[FXVH WKH DEXVH DQG SURFHHG ZLWK D VHFRQG KDEHDV
SHWLWLRQ                                                             :LWKWKH8QLWHG6WDWHV6XSUHPH&RXUWjV6HSWHPEHUWK
                                                                       GHQLDORIWKH6WDWHRI2KLRjVDSSOLFDWLRQWROLIWWKHVWD\
  )HGHUDO FRXUWV UHWDLQ WKH DXWKRULW\ WR LVVXH WKH ZULW RI    RIH[HFXWLRQHQWHUHGE\DPDMRULW\RIWKHDFWLYHMXGJHVRIWKLV
  KDEHDVFRUSXVLQDIXUWKHUQDUURZFODVVRIFDVHVGHVSLWH            FRXUW RQ 6HSWHPEHU  DQG WKH GLVVDWLVIDFWLRQ WKH QRQ
  D SHWLWLRQHUjV IDLOXUH WR VKRZ FDXVH IRU D SURFHGXUDO        SUHYDLOLQJMXGJHVKDYHH[SUHVVHGZLWKWKHSURFHGXUHVRIWKLV
  GHIDXOW  7KHVH DUH H[WUDRUGLQDU\ LQVWDQFHV ZKHQ D            FRXUWLQWKLVPDWWHU,IHHOFRPSHOOHGWRZULWHLQVXSSRUWRIWKH
  FRQVWLWXWLRQDO YLRODWLRQ SUREDEO\ KDV FDXVHG WKH                RUGHURIDPDMRULW\RIWKHHQEDQFFRXUWH[WHQGLQJWKHVWD\RI
  FRQYLFWLRQ RI RQH LQQRFHQW RI WKH FULPH  :H KDYH           H[HFXWLRQ  ,Q VR GRLQJ LW LV QHFHVVDU\ WR UHIXWH WKH JURVV
  GHVFULEHGWKLVFODVVRIFDVHVDVLPSOLFDWLQJDIXQGDPHQWDO           PLVFKDUDFWHUL]DWLRQDQGIDFWXDOPLVVWDWHPHQWVFRQWDLQHGLQ
  PLVFDUULDJHRIMXVWLFH0XUUD\Y&DUULHU VXSUD              WKHGLVVHQWVILOHGLQWKLVFDVH
  86DW6&WDW
                                                                          2Q7XHVGD\6HSWHPEHUDPDMRULW\RIWKHDFWLYHMXGJHV
0F&OHVNH\86DWVHHDOVR6FKOXS86DW          GLG WKH IROORZLQJ WZR WKLQJV ZLWK UHVSHFW WR WKLV FDVH
TXRWLQJ0F&OHVNH\$JDLQ%\UGLVQRWH[HPSWHGIURP              GHFOLQHGWROLIWDQHLJKWGD\VWD\RIH[HFXWLRQVHWRXWLQWKH
WKH$('3$jVVWDQGDUGVEHFDXVHWKHRXWFRPHRIWKLVFDVHGRHV            2UGHUGUDIWHGE\sXGJH6XKUKHLQULFKDQGGHFLGHGWRJUDQW
QRWGLIIHUXQGHUWKLVH[FHSWLRQHLWKHU                                DVWD\RIH[HFXWLRQXQWLO2FWREHU
   ,QLWLDOO\ ZH QRWH WKDW %\UG LQYRNHV WKH ZURQJ DFWXDO         +RZWKLVWRRNSODFHLVYHU\VLPSOH7KHWKUHHMXGJHSDQHO
LQQRFHQFH VWDQGDUG  &RQWUDU\ WR KLV DVVHUWLRQ WKH 6FKOXS     FRQVLVWLQJRIsXGJHV6XKUKHLQULFK%DWFKHOGHUDQGP\VHOI
VWDQGDUGGRHVQRWDSSO\,Q6FKOXSWKH6XSUHPH&RXUWKHOG            VSOLW  WR  RYHU WKH LVVXH RI %\UGjV HQWLWOHPHQW WR ILOH D
WKDW IRU D SURFHGXUDO FODLP RI LQQRFHQFH DV RSSRVHG WR D    VHFRQG SHWLWLRQ DQG KLV UHTXHVW IRU VWD\ RI H[HFXWLRQ 2Q
VXEVWDQWLYHFRQVWLWXWLRQDOFODLPRILQQRFHQFHDVLQ+HUUDUDY         6DWXUGD\6HSWHPEHU,UHTXHVWHGWKDWsXGJH6XKUKHLQULFK
&ROOLQV  86   WR PHHW WKH PLVFDUULDJH RI      MRLQLQJUDQWLQJDWKLUW\GD\VWD\RIH[HFXWLRQ+HWHQWDWLYHO\
MXVWLFH H[FHSWLRQ WR H[FXVH DEXVH RI WKH ZULW WKH KDEHDV     DJUHHGWRGRVR+RZHYHURQ6HSWHPEHUGXULQJDSDQHO
SHWLWLRQHUmPXVWVKRZWKDWLWLVPRUHOLNHO\WKDQQRWWKDWQR          FRQIHUHQFHFDOOKHSURSRVHGDVWD\RIRQO\HLJKWGD\VsXGJH
UHDVRQDEOHMXURUZRXOGKDYHFRQYLFWHGKLPLQOLJKWRIWKHQHZ          %DWFKHOGHUREMHFWHGLQWKHVWURQJHVWRIWHUPVDQGWKUHDWHQHG
                                                                       WRGLVVHQW$QGVKHGLGGLVVHQW,WROGsXGJH6XKUKHLQULFK
                                                                       WKDW,ZDVZLWKKROGLQJMXGJPHQWXQWLOUHFHLSWRIKLV2UGHU
                                                                       8SRQUHYLHZLQJWKHSDQHOPDMRULW\jVWZHQW\ILYHSDJH2UGHU
                                                                       DQGLWVLQMXGLFLRXVODQJXDJH,DGYLVHGsXGJH6XKUKHLQULFKLWV
                                                                       DXWKRURUDOO\DQGLQZULWLQJZLWKDFRS\WRsXGJH%DWFKHOGHU
     ,QUH%\UG                        1R          ,QUH%\UG                                        1R

    ,7,66225'(5('                                 HYLGHQFHl6FKOXS86DW+RZHYHUWKH6FKOXS
                                                      VWDQGDUG DSSOLHV WR FODLPV RI DFWXDO LQQRFHQFH RI WKH
             (17(5('%<25'(52)7+(&2857            XQGHUO\LQJFRQYLFWLRQ,GDW%\UGLVQRWFKDOOHQJLQJKLV
                                                      XQGHUO\LQJ FRQYLFWLRQ EXW RQO\ KLV VHQWHQFH  6HH %\UGjV
                                                      0HPRUDQGXP LQ 6XSSRUW  DW   Q  7KXV WKH
                                                      DSSURSULDWH VWDQGDUG RI UHYLHZ KHUH LV WKH mFOHDU DQG
                   V/HRQDUG*UHHQ                  FRQYLQFLQJVWDQGDUGIRXQGLQ6DZ\HUmZKLFKZDVIDVKLRQHG
             BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB         WRUHIOHFWWKHUHODWLYHLPSRUWDQFHRIDFODLPRIDQHUURQHRXV
                 /HRQDUG*UHHQ&OHUN                VHQWHQFHl,G
                                                         ,Q6DZ\HUWKH6XSUHPH&RXUWKHOGWKDWLQRUGHUIRUDFRXUW
                                                      WRUHDFKWKHPHULWVRIDSHWLWLRQHUjVVXFFHVVLYHFODLPWKDWKH
                                                      LV mDFWXDOO\ LQQRFHQWl RI WKH GHDWK SHQDOW\ WKH SHWLWLRQHU
                                                      mPXVWVKRZE\FOHDUDQGFRQYLQFLQJHYLGHQFHWKDWEXWIRUD

                                                           
                                                             %\UG LQGLFDWHV WKDW KH VHHNV WR UDLVH LQ KLV VHFRQG RU VXFFHVVLYH
                                                      SHWLWLRQ WKH IROORZLQJ FODLPV
                                                            $ 0DVVLDK FODLP LQYROYLQJ WKH VWDWHjV XVH RI LQIRUPDQW 9LUJLO
                                                           sRUGDQ WR HOLFLW VWDWHPHQWV IURP %\UG LQ YLRODWLRQ RI KLV 6L[WK
                                                           $PHQGPHQW ULJKW WR FRXQVHO  $ FODLP WKDW SURVHFXWRUV
                                                           SUHVHQWHG WHVWLPRQ\ WKH\ NQHZ ZDV IDOVH ZKHQ WKH\ KDG WZR
                                                           ZLWQHVVHV LGHQWLI\ D NQLIH DV WKH ZHDSRQ XVHG LQ WKH 87RWHP
                                                           UREEHU\ HYHQ DIWHU WKH FULPH ODE FRQFOXGHG WKDW WKH NQLIH ZDV QRW
                                                           WKH RQH XVHG LQ WKDW UREEHU\  $ FODLP WKDW WULDO FRXQVHO ZHUH
                                                           LQHIIHFWLYH IRU IDLOLQJ WR LQYHVWLJDWH DQG SUHVHQW WHVWLPRQ\ IURP
                                                           DYDLODEOH :RUNKRXVH LQPDWHV ZKR FRXOG KDYH UHYHDOHG WKH
                                                           VFKHPH FRQFRFWHG E\ 5RQDOG $UPVWHDG DQG 9LUJLO sRUGDQ WR JLYH
                                                           IDOVH WHVWLPRQ\ DJDLQVW %\UG DQG KLV FRGHIHQGDQWV DQG  $
                                                           VXEVWDQWLYH FODLP RI DFWXDO LQQRFHQFH RI WKH GHDWK SHQDOW\ XQGHU
                                                           +HUUDUD Y &ROOLQV  86  
                                                      %\UGjV 0HPRUDQGXP LQ 6XSSRUW DW  Q 2Q WKH VXUIDFH LW DSSHDUV WKDW
                                                      %\UG LV DWWHPSWLQJ WR XVH KLV DFWXDO LQQRFHQFH FODLP DV D mJDWHZD\
                                                      WKURXJK ZKLFK D KDEHDV SHWLWLRQ PXVW SDVV WR KDYH KLV RWKHUZLVH EDUUHG
                                                      FRQVWLWXWLRQDO FODLP FRQVLGHUHG RQ WKH PHULWVl 6FKOXS  86 DW 
                                                       ,Q DFWXDOLW\ KH LV WU\LQJ WR XVH KLV DFWXDO LQQRFHQFH FODLP SURFHGXUDOO\ DV
                                                      WKH ZD\ WR UDLVH EDUUHG FRQVWLWXWLRQDO FODLPV DQG DQ DOVREDUUHG
                                                      VXEVWDQWLYH DFWXDO LQQRFHQFH FODLP
                                                           )XUWKHUPRUH %\UGjV FODLP WKDW KH FRXOG QRW KDYH UDLVHG KLV DFWXDO
                                                      LQQRFHQFH FODLP LQ WKH VWDWH FRXUW EHFDXVH 2KLR GLG QRW DW WKH WLPH
                                                      UHFRJQL]H DFWXDO LQQRFHQFH RI WKH GHDWK SHQDOW\ DV D FRJQL]DEOH FODLP
                                                      PXVW EH UHMHFWHG EHFDXVH KH PRVW FHUWDLQO\ FRXOG KDYH XVHG LW LQ VXSSRUW
                                                      RI KLV GXH SURFHVV FKDOOHQJH WR WKH VXIILFLHQF\ RI WKH HYLGHQFH 6HH 6WDWH
                                                      Y &DPSEHOO  :/  DW 
 1R & 2KLR &W $SS sDQ 
                                                       SHU FXULDP
1R                                        ,QUH%\UG          1R                                    ,QUH%\UG      

FRQVWLWXWLRQDOHUURUQRUHDVRQDEOHMXURUZRXOGKDYHIRXQGWKH            81,7('67$7(6&28572)$33($/6
SHWLWLRQHUHOLJLEOHIRUWKHGHDWKSHQDOW\XQGHUWKHDSSOLFDEOH
VWDWHODZl6DZ\HU86DW%\UGFDQQRWPHHWWKLV
VWDQGDUG                                                                               )257+(6,;7+&,5&8,7
                                                                                            BBBBBBBBBBBBBBBBB
  %\UGjVRQO\HYLGHQFHLVWKHILUVW%UHZHUDIILGDYLW,WZDV
PDGH LQ  VL[ \HDUV DIWHU KH KDG EHHQ FRQYLFWHG DQG
VHQWHQFHGIRUKLVSDUWLQWKH7HZNVEXU\UREEHU\DQGPXUGHU
6HH6WDWHY%UHZHU1R&:/2KLR&W                  ,QUHs2+1 : %<5' s5          ;
$SSsXO\DIILUPLQJ%UHZHUjVFRQYLFWLRQRQGLUHFW                                    0RYDQW         
                                                                                                                 !
DSSHDO7KXV%UHZHUjVFRQIHVVLRQZDVPDGHRQO\DIWHUKH                                                      
ZDVQRORQJHUVXEMHFWWRIXUWKHUSXQLVKPHQWIRUKLVDFWLRQVLQ                                                 1     1R
WKDWUREEHU\DQGPXUGHU%\ZDLWLQJWRSURYLGHWKHVWDWHPHQW
XQWLO%UHZHUFRXOGDUJXDEO\VKLHOGERWKKLPVHOIDQG
%\UG IURP WKH GHDWK SHQDOW\ EHFDXVH RI GRXEOH MHRSDUG\                           5HILOHG6HSWHPEHU
6XFKWDFWLFDOPDQHXYHUVUHQGHUWKHDIILGDYLWKLJKO\VXVSHFW                                  BBBBBBBBBBBBBBBBB
   )XUWKHUPRUH%UHZHUjVDIILGDYLWFRQWUDGLFWVKLVRZQWULDO                                       25'(5
WHVWLPRQ\,Q$XJXVW%UHZHUWHVWLILHGDWKLVRZQWULDO                                BBBBBBBBBBBBBBBBB
+HVWDWHGWKDWKHGLGQRWSDUWLFLSDWHLQWKHNLOOLQJRI0RQWH
7HZNVEXU\DQGZDVQRWDWWKH.LQJ.ZLN%UHZHU7U                     $PHPEHURIWKHFRXUWKDVUHTXHVWHGWKDWWKHHQEDQFFRXUW
1RWORQJDIWHUKLVWULDOZKLOHDZDLWLQJSODFHPHQWLQD             GHWHUPLQHZKHWKHUWRYDFDWHWKHVWD\RIH[HFXWLRQLQFOXGHGLQ
VWDWHSHQDOLQVWLWXWLRQ%UHZHUWROGDSULVRQVRFLDOZRUNHUDQG           LWV6HSWHPEHUGHFLVLRQRQWKHPRYDQWjVUHTXHVWIRU
DSV\FKRORJ\DVVLVWDQWRQ$XJXVWDQG$XJXVW                 DGHWHUPLQDWLRQWKDW86&EGRHVQRWDSSO\WR
WKDW %\UG NLOOHG 7HZVNEXU\  ,Q 6HSWHPEHU  KH DOVR          KLPDQGKLVUHTXHVWIRUDVWD\RIH[HFXWLRQZKLOHKHSXUVXHV
ZURWH OHWWHUV WR WKH SDUROH DXWKRULW\ VWDWLQJ WKDW KH GLG QRW   DVHFRQGIHGHUDOKDEHDVSHWLWLRQ
ZDQW WR EH VHQW WR WKH /XFDVYLOOH SULVRQ ZKHUH %\UG DQG
:RRGDOOZHUHDQGUHLWHUDWLQJWKDWKHNQHZQRWKLQJDERXWWKH                 7KHUHTXHVWIRUDQHQEDQFGHWHUPLQDWLRQKDVEHHQUHIHUUHG
NLOOLQJs$                                                   WRDOORIWKHDFWLYHMXGJHVRIWKHFRXUWOHVVWKDQDPDMRULW\RI
                                                                          ZKRPKDYHYRWHGLQIDYRURIYDFDWLQJWKHVWD\$PDMRULW\
   %\UG DFNQRZOHGJHV WKHVH IDFWV LQ KLV 0HPRUDQGXP LQ              RIWKHDFWLYHMXGJHVKDYHYRWHGWRH[WHQGWKHVWD\RIH[HFXWLRQ
6XSSRUWEXWQRQHWKHOHVVDWWHPSWVWRH[SODLQWKHLQFRQVLVWHQF\            XQWLO2FWREHULQDGGLWLRQWKHFOHUNRIWKHFRXUWLV
ZLWKKLVDIILGDYLWVDVmXQGHUVWDQGDEOHlEHFDXVHm>W@ZHQW\\HDU            GLUHFWHGWRILOHDQGVXEPLWWRWKHFRXUWDQ\SHWLWLRQRIIHUHGE\
ROGGHIHQGDQWVZKRJRRQWULDODUHQRWHDJHUWREHFRQYLFWHG              DSDUW\VHHNLQJHQEDQFUHYLHZRIWKHGHFLVLRQRIWKHSDQHO
RIVHULRXVFULPHVZLWKORQJVHQWHQFHVl%\UGjV0HPRUDQGXP
LQ 6XSSRUW DW   %\UG IXUWKHU DWWHPSWV WR PLQLPL]H WKH
DEVROXWHFRQWUDGLFWLRQVE\SURFODLPLQJWKDWm%UHZHUUHDGLO\
DGPLWVLQKLVDIILGDYLWWKDWKLVWULDOWHVWLPRQ\ZDVQRW
WUXWKIXOl,G7KH TXHVWLRQIRUWKLV&RXUWWKHQLVm:DV
%UHZHU O\LQJ LQ  ZDV %UHZHU O\LQJ LQ  RU LV KH
O\LQJ QRZ"l  7KLV LV FHUWDLQO\ QRW WKH NLQG RI mFOHDU DQG
1R                                ,QUH%\UG               ,QUH%\UG                                   1R

 8QGHUWKHVHFLUFXPVWDQFHV                                      FRQYLQFLQJHYLGHQFHlWKDWZRXOGSUHYHQWDQ\UHDVRQDEOHMXURU
                                                                 IURPILQGLQJ%\UGHOLJLEOHIRUWKHGHDWKSHQDOW\
   HLWKHUWKH6XSUHPH&RXUWPXVWUHYHUVHDWDPLQLPXP
   WKHH[WHQGHGVWD\                                               7KHUH LV DOVR WKH G\LQJ GHFODUDWLRQ RI WKH WKLUG FR
                                                                 GHIHQGDQW:LOOLDP:RRGDOO:RRGDOOZDVGLDJQRVHGODWH
   WKLV FRXUW PXVW DGRSW QHZ FRXUW UXOHV H[SOLFLWO\       ODVW\HDUZLWKWHUPLQDOFDQFHU2QsDQXDU\KHZDV
   DOORZLQJWKLVW\SHRIFXUUHQWO\ODZOHVVDFWLRQRU            UXVKHGWRWKHORFDOKRVSLWDOEHFDXVHKHZDVVXIIHULQJIURP
                                                                 mFKHVW SDLQV SRVVLEOH KHDUW DWWDFNl  s$   7ZR
   ZHPXVWUHFRJQL]HDQGFRQIHVVWKDWDPDMRULW\RIWKH          SURVHFXWRUVDQGDVWDWHKLJKZD\SDWUROPDQZHQWWRVHHKLP
   FRXUWVLPSO\IHHOVWKDWLWLVQRWERXQGE\ODZZKHQLW        ,QVLJQHGDIILGDYLWVUHFRXQWLQJWKHLULQWHUYLHZWKH\FODLPWKDW
   FRPHVWRVRPHGHDWKVHQWHQFHGSULVRQHUV                      :RRGDOOEODPHG%\UGIRU7HZNVEXU\PXUGHU+RZDUG+
                                                                 +XGVRQ ,,, D VWDII OLHXWHQDQW DVVLJQHG WR WKH 2IILFH RI
                                                                 ,QYHVWLJDWLYH6HUYLFHVZLWKWKH2KLR6WDWH+LJKZD\3DWURO
                                                                 VWDWHGLQKLVDIILGDYLWWKDW
                                                                     0U :RRGDOO H[SUHVVHG H[WUHPH UHPRUVH RYHU WKH
                                                                   GHDWKRI0RQWH7HZNVEXU\VWDWHGWKDWKHZDVG\LQJIURP
                                                                   OXQJFDQFHUDQGKDGEHHQWROGKHKDVQRPRUHWKDQD\HDU
                                                                   WROLYHDQGWKDWKHKDGPDGHKLVSHDFHZLWK*RG
                                                                     0U :RRGDOO VDLG WKDW \HDU DJR ZKLOH KH ZDV
                                                                   FRQILQHGDWWKH6RXWKHUQ2KLR&RUUHFWLRQDO)DFLOLW\LQ
                                                                   /XFDVYLOOH2KLRKHVLJQHGDIILGDYLWVIRUWKH2KLR3XEOLF
                                                                   'HIHQGHUZKLFKZHUHQRWWUXH+HVLJQHGWKHVHDWWKH
                                                                   UHTXHVW RI LQPDWH sRKQQ\ %UHZHU WR KHOS LQPDWH sRKQ
                                                                   %\UG sU  5HFHQWO\ KH KDV EHHQ DVNHG RQ QXPHURXV
                                                                   RFFDVLRQV WR PHHW ZLWK WKH 2KLR 3XEOLF 'HIHQGHUjV
                                                                   UHSUHVHQWLQJsRKQ%\UGsUEXWWKDWKHKDVUHIXVHGWRGR
                                                                   VR
                                                                   0U:RRGDOOVDLGWKDWsRKQQ\%UHZHUQHYHUWROGKLP
                                                                   WKDWKHKDGNLOOHG0RQWH7HZNVEXU\0U:RRGDOOZDV
                                                                   VKRZQ WKH VWDWHPHQW LQ sRKQQ\ %UHZHUjV DIILGDYLW
                                                                   QXPEHUHGZKHUHLQKHVWDWHGm:KHQ,JRWEDFNLQWKH
                                                                   YDQ,VDLGWR'DQQ\:RRGDOOµ0DQ,VWDEEHGDJX\WDNH
                                                                   RIIjl0U:RRGDOOVDLGWKDWGLGQRWKDSSHQ
                                                                     0U :RRGDOO VWDWHG WKDW ZKHQ sRKQ %\UG sU DQG
                                                                   sRKQQ\%UHZHUUHWXUQHGWRWKHYDQDIWHUFRPLQJRXWRI
                                                                   .LQJ.ZLNWKDWsRKQ%\UGsUKDGWKHNQLIH
1R                                     ,QUH%\UG            ,QUH%\UG                                    1R

    0U :RRGDOO VWDWHG WKDW ZKLOH FRQILQHG DW WKH $      +RZHYHU , FDQQRW XQGHUVWDQG KRZ D SDQHO FDQ UHQGHU D
  %ORFN RI WKH &LQFLQQDWL :RUNKRXVH DZDLWLQJ WULDO LQ        GHFLVLRQ RQ WKH PHULWV ZKLFK DIILUPDWLYHO\ ILQGV WKDW WKH
   sRKQ %\UG sU WROG EODFN LQPDWHV ZKR ZHUH          SULVRQHUjVFODLPVKDYHQRPHULWDQGWKHQLVVXHDVWD\WRDOORZ
  KDUDVVLQJ KLP QRW WR PHVV ZLWK KLP EHFDXVH KH KDG        RQH PHPEHU RI WKH SDQHO mDGGLWLRQDO WLPH WR FRQVLGHU WKH
  DOUHDG\NLOOHGDPDQDQGZDVQjWDIUDLGWRNLOODJDLQ             PDWWHUl  :H DUH QRW D mVXSHUFRXUWl WKDW VXSHUYLVHV DOO
                                                                    H[HFXWLRQV LQ WKH VWDWHV ZLWKLQ RXU MXULVGLFWLRQ  2XU
  0U:RRGDOOVDLGWKHRZQHURIWKHYDQXVHGGXULQJ            MXULVGLFWLRQLVOLPLWHGE\&RQVWLWXWLRQDQGVWDWXWH7KHSDQHO
  WKHPXUGHURI0RQWH7HZVNEXU\/HUR\7XQVWDOOYLVLWHG            KDVGHWHUPLQHGDOOPDWWHUVWKDWFRPHZLWKLQWKDWMXULVGLFWLRQ
  KLPLQMDLOVKRUWO\DIWHUWKHFULPHV0U:RRGDOOWROG
  /HUR\ 7XQVWDOO WKDW sRKQ %\UG sU ZDV WKH RQH ZKR         7KLVFRXUWjVSRZHUWRLVVXHDVWD\ZDVWKHUHIRUHGXELRXVDW
  PXUGHUHG0RQWH7HZNVEXU\                                         EHVWDIDFWWKDWWKHSDQHODSSDUHQWO\ODWHUUHFRJQL]HGVLQFHLW
                                                                    UHPRYHGDOOUHIHUHQFHWRWKHVWD\IURPLWVDPHQGHGGHFLVLRQ
s$)XUWKHUPRUH0DUN(3LHSPHLHUDQDVVLVWDQW        &RPSDUH6HSWHPEHU2UGHU'HQ\LQJsRKQ%\UGjV
+DPLOWRQ&RXQW\3URVHFXWRUDWWHVWHGWKDW                          0RWLRQ WR 'HWHUPLQH ZKHWKHU  86&  E RI WKH
                                                                    $('3$$SSOLHVWRKLV&DVHDQG*UDQWLQJD7HPSRUDU\6WD\
    , YLVLWHG 0U :RRGDOO DW WKH /RQGRQ &RUUHFWLRQDO    RI([HFXWLRQXQWLO6HSWHPEHUZLWK6HSWHPEHU
  )DFLOLW\ RQ sDQXDU\   DORQJ ZLWK DVVLVWDQW          2UGHU 'HQ\LQJ sRKQ %\UGjV 0RWLRQ WR 'HWHUPLQH
  +DPLOWRQ&RXQW\3URVHFXWRU:LOOLDP(%UH\HUDQG6W              ZKHWKHU86&ERIWKH$('3$$SSOLHVWRKLV
  /W +RZDUG +XGVRQ RI WKH 2KLR 6WDWH +LJKZD\                &DVH7KHQKRZHYHUWKHVLWXDWLRQZDVH[DFHUEDWHGZKHQ
  3DWURO                                                    WKHFOHUNRIWKLVFRXUWLVVXHGDPXFKORQJHUVWD\DSSDUHQWO\
                                                                    EDVHGRQWKHZRUGRIRQH$UWLFOH,,,MXGJHWKDWDPDMRULW\RI
  ,ZDVSUHVHQWZKHQ0U:RRGDOOPDGHWKHVWDWHPHQWV           WKHDFWLYHPHPEHUVRIWKHFRXUWKDGDSSURYHGLW7KLVDFWZDV
  FRQWDLQHGLQWKHDIILGDYLWRI+RZDUG+XGVRQ                      WDNHQ LQ UHVSRQVH WR QR DSSDUHQW PRWLRQ LW KDG QR
                                                                    MXULVGLFWLRQDOEDVLVDQGLWZDVGRQHZLWKRXWSURYLGLQJDQ\
  ,PDGHDIROORZXSYLVLWWR0U:RRGDOODWWKH2KLR          QRWLFHWRVRPHPHPEHUVRIWKHFRXUW
  6WDWH 8QLYHUVLW\ +RVSLWDO RQ :HGQHVGD\ sDQXDU\ 
  DORQJZLWKDVVLVWDQW+DPLOWRQ&RXQW\3URVHFXWRU                 :KDWZHKROGDSSDUHQWO\LVWKDWGHDWKVHQWHQFHGSULVRQHUV
  :LOOLDP(%UH\HU                                              QHHGQRWUHVRUWWRFUHDWLYHOHJDOWDFWLFVWRFRPHZLWKLQWKLV
                                                                    FRXUWjV MXULVGLFWLRQ  6R SULVRQHUV PD\ ILOH DQ\WKLQJ
  0U%UH\HUDQG,VSRNHWR0U:RRGDOOLQDKRVSLWDO          UHJDUGOHVVRIVWDWXWHRUSULRUODZDQGWKHHQEDQFFRXUWPD\
  URRPDWWKH2KLR6WDWH8QLYHUVLW\+RVSLWDORQsDQXDU\             VWD\WKHLUH[HFXWLRQIRUDQ\OHQJWKRIWLPHLWFKRRVHV)RU
  0U:RRGDOOVDLGKLVPHGLFDOFRQGLWLRQKDG             H[DPSOH WKH\ FRXOG ILOH D KRW GRJ PHQX DQG WKH HQ EDQF
  ZRUVHQHGDQGKHUHDOL]HGKHGLGQRWKDYHORQJWROLYH          FRXUWPLJKWXVHWKDWDVDOHJDOEDVLVWRVWD\WKHLUH[HFXWLRQ
  0U:RRGDOOFRQILUPHGWKDWHYHU\WKLQJKHKDGWROG              7KHWUXWKPD\EHWKDWIRUWKLVSULVRQHUDPDMRULW\RIWKH
  P\VHOI0U%UH\HUDQG+RZDUG+XGVRQRQsDQXDU\              DFWLYHPHPEHUVRIWKLVFRXUWZRXOGJUDQWDVWD\EDVHGRQDKRW
  ZDVWUXH                                                  GRJPHQX7KLVKRZHYHULVQRWDFRUUHFWVWDWHPHQWRIWKH
  0U:RRGDOOVDLGWKDWsRKQQ\%UHZHUKDGZULWWHQWR           ODZQRULVLWRIDQ\VRUWRIODZDWDOO
  KLPVHYHUDOWLPHVDQGWROGKLPWKDWKHZDVJRLQJWROLH
1R                                       ,QUH%\UG               ,QUH%\UG                                   1R

                       BBBBBBBBBBBBBBB                                    RQEHKDOIRI0U%\UGDQGHQFRXUDJHG0U:RRGDOOWR
                                                                          GRWKHVDPH
                          ',66(17
                       BBBBBBBBBBBBBBB                                  s$:RRGDOOGLHGRQ$SULO
                                                                          :RRGDOODOVRLPSOLFDWHG%\UGLQ$XJXVWOHVVWKDQD
  %2**6 &LUFXLW sXGJH GLVVHQWLQJ IURP WKH UHIXVDO WR           PRQWKDIWHUKLVWULDOZKHQKHWROGDSULVRQVRFLDOZRUNHUWKDW
YDFDWH WKH SDQHOjV VWD\ DQG GLVVHQWLQJ IURP WKH RUGHU           KHRQO\GURYHWKHYDQDQGWKDW%\UGVDLGKHVWDEEHGWKHVWRUH
H[WHQGLQJWKHVWD\                                                     FOHUN  ,Q WZR OHWWHUV ZULWWHQ RQ $XJXVW   DQG
                                                                        6HSWHPEHU   :RRGDOO DVNHG WKDW KH QRW EH VHQW WR
   7KHSDQHOjVRUGHURI6HSWHPEHU2UGHU'HQ\LQJ               /XFDVYLOOHEHFDXVH%\UGZDVWKHUHDQG%\UGZDVPDGDWKLP
sRKQ %\UGjV 0RWLRQ WR 'HWHUPLQH ZKHWKHU  86&                :RRGDOO DOVR LQGLFWHG WKDW %\UG ZDV XQWUXWKIXOO\ EODPLQJ
 E RI WKH $('3$ $SSOLHV WR KLV &DVH DGGUHVVHV          %UHZHUIRUWKHVWDEELQJs$
%\UGjVVHOIWLWOHGm0RWLRQ>WR@'HWHUPLQH:KHWKHU86&
ERIWKH $('3$DSSOLHVWR+LV&DVHl+RZHYHU                    /LNH%UHZHUjVYDULRXVVWDWHPHQWVRYHUWKH\HDUV:RRGDOOjV
SURFHGXUDOO\%\UGjVPRWLRQFDQRQO\EHRQHWKLQJLILWLVWREH         VWDWHPHQWV DUH FRQWUDGLFWRU\  $FFRUGLQJ WR IRUPHU LQPDWH
SURSHUO\ EHIRUH WKLV FRXUW DQ DSSOLFDWLRQ SXUVXDQW WR        'DQ&DKLOO:RRGDOOWROGKLPZKLOHERWKZHUHZRUNLQJDV
86&E$VHHNLQJSHUPLVVLRQRIWKHFRXUWRI              2KLR 3ULVRQ ,QGXVWULHV FOHUNV WKDW %\UG GLG QRW VWDE
DSSHDOVWRILOHDVHFRQGKDEHDVSHWLWLRQ7KHSDQHOGHDOWZLWK         7HZNVEXU\DQGWKDWWKHZURQJPDQZDVRQGHDWKURZs$
%\UGjVPRWLRQDVVXFKVHHLGDWQDQGUHQGHUHGDGHFLVLRQ            ,Q  :RRGDOO VLJQHG DQ DIILGDYLW IRU WKH 2KLR
RQWKHPHULWVILUVWKROGLQJWKDWEGRHVDSSO\WR%\UG          3XEOLF'HIHQGHUjVRIILFHLQZKLFKKHVWDWHGWKDW%UHZHUQRW
DQGWKHQGHQ\LQJKLVUHTXHVWWRILOHDVHFRQGKDEHDVSHWLWLRQ          %\UGFDUULHGWKHNQLIHDWDOOWLPHVDQGWKDWZKHQKHOHIWWKH
$QRUGHUVXFKDVWKLVGHQ\LQJSHUPLVVLRQWRILOHDVHFRQG              .LQJ .ZLN VWRUH WKH NQLIH %UHZHU ZDV VWLOO FDUU\LQJ ZDV
KDEHDVSHWLWLRQLVQRWUHYLHZDEOHHQEDQF6HH,QUH.LQJ            FRYHUHGZLWKEORRGs$
)GWK&LU
                                                                           ,URQLFDOO\%\UGVWDWHVLQKLV0HPRUDQGXPWKDWKHGLGQRW
   $OWHUQDWLYHO\WKHSDQHOPD\KDYHIRXQG%\UGH[HPSWIURP             VXEPLW:RRGDOOjVDIILGDYLWLQWKHVWDWHSRVWFRQYLFWLRQSHWLWLRQ
$('3$+RZHYHULQWKDWFDVHWKLVFRXUWZRXOGKDYHQR                 mEHFDXVH RI FRQFHUQV DERXW KLV UHOLDELOLW\l  %\UGjV
MXULVGLFWLRQ RYHU KLV SHWLWLRQ DV D KDEHDV SHWLWLRQ PXVW EH   0HPRUDQGXPLQ6XSSRUWDW%UHZHUjVYDU\LQJVWDWHPHQWV
ILOHGILUVWLQGLVWULFWFRXUW+DG%\UGJRQHWRGLVWULFWFRXUWLW     VKDUHWKHVDPHFRQVLVWHQWO\LQFRQVLVWHQWVWRULHVDQGZHVKDUH
LV FRQFHLYDEOH WKDW DFWLRQ E\ WKH GLVWULFW FRXUW FRXOG EH      %\UGjVmFRQFHUQVDERXW>%UHZHUjV@UHOLDELOLW\l,QVKRUWWKH
UHYLHZHGRQDSSHDORUHQEDQF+RZHYHURXUFRXUWFDQQRW               HYLGHQFH EHIRUH XV LV KRSHOHVVO\ FRQWUDGLFWRU\  ERWK
WDNHMXULVGLFWLRQRYHUDQRQ$('3$KDEHDVSHWLWLRQLQWKH               LQWHUQDOO\ DQG DV EHWZHHQ WKH WZR FRGHIHQGDQWV  7KLV LV
ILUVWLQVWDQFH                                                         VLPSO\QRWFOHDUDQGFRQYLQFLQJHYLGHQFHWKDWZRXOGDOORZXV
                                                                        WRFRQFOXGHWKDWQRUHDVRQDEOHMXURUZRXOGKDYHIRXQG%\UG
  , FDQ XQGHUVWDQG KRZ D SDQHO IDFHG ZLWK D ODVWPLQXWH       HOLJLEOH IRU WKH GHDWK SHQDOW\  %\UGjV HYLGHQFH GRHV QRW
PRWLRQDQGRXWRIDQDEXQGDQFHRIFDXWLRQFRXOGVWD\DQ               VDWLVI\WKH6DZ\HUVWDQGDUG
H[HFXWLRQZKLOHLWLVFRQVLGHULQJWKHPRWLRQ,FDQXQGHUVWDQG
ZK\ D PHPEHU RI WKH SDQHO IRU WDFWLFDO RU RWKHU UHDVRQV
FRXOGUHTXHVWWKDWWKHSDQHOGHIHUDUXOLQJDQGLVVXHDVWD\
1R                                       ,QUH%\UG              ,QUH%\UG                        1R

                                ,9                                         ,7,66225'(5('
   %\UGDVNVXVLQWKHDOWHUQDWLYHWRUHPDQGKLVFDVHWRWKH                         (17(5('%<25'(52)7+(&2857
GLVWULFWFRXUWIRUDQHYLGHQWLDU\KHDULQJ+RZHYHUWKH2KLR
VWDWHFRXUWVKDYHDOUHDG\UHMHFWHGKLVQHZHYLGHQFHRIDFWXDO
LQQRFHQFHILQGLQJWKDWLWODFNHGDQ\FUHGLELOLW\7KLVIDFWXDO
ILQGLQJ LV HQWLWOHG WR D SUHVXPSWLRQ RI FRUUHFWQHVV LQ ODWHU                    V/HRQDUG*UHHQ
IHGHUDOKDEHDVFRUSXVFDVHV3DWWRQY<RXQW86                        BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
VHHDOVR(OOLVY&ROOLQV)GWK                             /HRQDUG*UHHQ&OHUN
&LUKROGLQJWKDWDVWDWHWULDOFRXUWjVVXPPDU\GHWHUPLQDWLRQ
WKDWDIILGDYLWVODFNHGFUHGLELOLW\ZDVHQWLWOHGWRDSUHVXPSWLRQ
RI FRUUHFWQHVV LQ IHGHUDO KDEHDV FRUSXV SURFHHGLQJV FHUW
GHQLHG  86    )RU WKH UHDVRQV DUWLFXODWHG
DERYHZHILQGDEVROXWHO\QREDVLVWRGLVWXUEWKDWILQGLQJ
  %\UGjV UHTXHVW IRU DQ HYLGHQWLDU\ KHDULQJ PXVW DOVR EH
UHMHFWHG EHFDXVH KH IDLOHG WR GLOLJHQWO\ GHYHORS IDFWV LQ
VXSSRUWRIKLVFODLPDQGFDQQRWVKRZFDXVHDQGSUHMXGLFH
6HH:LOOLDPVY7D\ORU86QRWLQJ
WKDW  86&  jV OLPLWDWLRQ RQ HYLGHQWLDU\ KHDULQJV
FRGLILHV DQG VWUHQJWKHQV SUH$('3$ GXH GLOLJHQFH
UHTXLUHPHQW HVWDEOLVKHG E\ .HHQH\ Y 7DPD\R5H\HV 
86    $QG LQ DOO HYHQWV %\UG KDG D SUHYLRXV
RSSRUWXQLW\ WR H[SORUH KLV DFWXDO LQQRFHQFH o LQ KLV ILUVW
IHGHUDOKDEHDVSHWLWLRQ%\UGjVUHTXHVWLVUHMHFWHG
                                 9
   %\UGjV UHQHZHG DWWDFNV RQ WULDO ZLWQHVV $UPVWHDGjV
FUHGLELOLW\WRWKHH[WHQWWKH\DUHQRWEDUUHGXQGHU86&
 E GR QRW SURYLGH SURRI RI mDFWXDO LQQRFHQFHl
VXIILFLHQWWRH[FXVHDQDEXVHRIWKHZULW&I&ODUNY/HZLV
)GWK&LUDOOHJDWLRQWKDWSURVHFXWLRQ
ZLWQHVV FRXOG KDYH EHHQ LPSHDFKHG E\ DOOHJHGO\ ZLWKKHOG
HYLGHQFH GLG QRW FRQVWLWXWH D FUHGLEOH FODLP RI mDFWXDO
LQQRFHQFHlVXIILFLHQWWRVKRZWKDWWKHSHWLWLRQHUZDVDFWXDOO\
LQQRFHQWRIWKHGHDWKSHQDOW\
1R                                    ,QUH%\UG             ,QUH%\UG                                 1R

81,7('67$7(6&28572)$33($/6                                                                   9,

                )257+(6,;7+&,5&8,7                                  )RU DOO WKH IRUHJRLQJ UHDVRQV %\UGjV UHTXHVW IRU DQ
                                                                    H[HPSWLRQIURPERIWKH$('3$LV'(1,('$1'
                    BBBBBBBBBBBBBBBBB                               $7(0325$5<67$<2)(;(&87,21,6*5$17('
                                                                    817,/6(37(0%(5)XUWKHUEHFDXVH%\UGKDV
                                                                    FLWHGQRQHZUXOHRIFRQVWLWXWLRQDOODZRUSURYLGHGDQ\QHZO\
                                                                    GLVFRYHUHG HYLGHQFH WKH $('3$ EDUV WKH ILOLQJ RI DQ\
 ,QUHs2+1 : %<5' s5          ;                              VHFRQGRUVXFFHVVLYHSHWLWLRQ7KXV%\UGjVPRWLRQIRUVWD\
                      0RYDQW                                      RIH[HFXWLRQLV'(1,('
                                       !
                                      
                                     1     1R
                                                                               (17(5('%<25'(52)7+(&2857

                5HILOHG6HSWHPEHU
                    BBBBBBBBBBBBBBBBB                                                 V/HRQDUG*UHHQ
                                                                               BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
                         25'(5
                    BBBBBBBBBBBBBBBBB                                                        &OHUN

   $PHPEHURIWKHFRXUWKDVUHTXHVWHGWKDWWKHHQEDQFFRXUW
GHWHUPLQHZKHWKHUWRYDFDWHWKHVWD\RIH[HFXWLRQLQFOXGHGLQ
LWV6HSWHPEHUGHFLVLRQRQWKHPRYDQWjVUHTXHVWIRU
DGHWHUPLQDWLRQWKDW86&EGRHVQRWDSSO\WR
KLPDQGKLVUHTXHVWIRUDVWD\RIH[HFXWLRQZKLOHKHSXUVXHV
DVHFRQGIHGHUDOKDEHDVSHWLWLRQ
   7KHUHTXHVWIRUDQHQEDQFGHWHUPLQDWLRQKDVEHHQUHIHUUHG
WRDOORIWKHDFWLYHMXGJHVRIWKHFRXUWOHVVWKDQDPDMRULW\RI
ZKRPKDYHYRWHGLQIDYRURIYDFDWLQJWKHVWD\$PDMRULW\
RIWKHDFWLYHMXGJHVKDYHYRWHGWRH[WHQGWKHVWD\RIH[HFXWLRQ
XQWLO2FWREHULQDGGLWLRQWKHFOHUNRIWKHFRXUWLV
GLUHFWHGWRILOHDQGVXEPLWWRWKHFRXUWDQ\SHWLWLRQRIIHUHGE\
DSDUW\VHHNLQJHQEDQFUHYLHZRIWKHGHFLVLRQRIWKHSDQHO
1R                                       ,QUH%\UG         1R                                             ,QUH%\UG   

  BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB                                               
  &21&855,1*,13$57',66(17,1*,13$57                                                            ',66(17
  BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB                                               
  $/,&(0%$7&+(/'(5&LUFXLWsXGJHFRQFXUULQJLQ                        1$7+$1,(/5s21(6&LUFXLWsXGJHGLVVHQWLQJ,DP
SDUWDQGGLVVHQWLQJLQSDUW,FRQFXULQWKHUHVXOWUHDFKHGLQ         FRQYLQFHG EH\RQG GRXEW WKDW WKLV FRXUW PXVW FDUHIXOO\
sXGJH6XKUKHLQULFKjVRSLQLRQDQGLQWKHUHDVRQLQJWKHUHLQ,           H[SORUHZKHWKHU%\UGFDQVDWLVI\WKHOHJDOVWDQGDUGWKDWZRXOG
VSHFLILFDOO\GLVVHQWIURPWKHJUDQWLQJRIDVWD\RIH[HFXWLRQ           HQWLWOHKLPWRILOHDVHFRQGKDEHDVSHWLWLRQ7KHFRPSOH[LW\
DQGDFRQWLQXDQFH                                                    RIWKHLVVXHVUDLVHGE\WKHSHWLWLRQHUDUHRIVXFKVFRSHDQG
                                                                        PDJQLWXGHDVWRGHPDQGDFDUHIXODQGH[KDXVWLYHDQDO\VLV,
  8QGHUVWDQGLQJ WKH SURFHGXUDO SRVWXUH RI WKLV PDWWHU LV         EHOLHYH WKDW WKH SHWLWLRQ VTXDUHO\ LPSOLFDWHV D TXHVWLRQ RI
FULWLFDO WR DQ XQGHUVWDQGLQJ RI ZK\ WKHUH LV QR OHJDO EDVLV   IXQGDPHQWDOIDLUQHVV7KXVDVWD\RIH[HFXWLRQLVLPSHUDWLYH
XSRQ ZKLFK D VWD\ RI H[HFXWLRQ DQG D FRQWLQXDWLRQ RI WKLV     %\UGVKRXOGQRWEHSXWWRGHDWKEHIRUHWKLVFRXUWLVDEOHWR
PDWWHU PD\ EH JUDQWHG   %\UG FRQFHGHV WKDW WKH LQLWLDO       JLYHIXOOFRQVLGHUDWLRQWRWKHLVVXHVUDLVHGLQKLVFDVH6WHIIHQ
GHWHUPLQDWLRQ RI ZKHWKHU WKH $('3$ DSSOLHV WR WKLV FDVH         Y7DWH)GWK&LU
PXVWEHPDGHE\WKLVFRXUWDQGQRWWKHGLVWULFWFRXUW7KH
YHKLFOHIRUREWDLQLQJWKDWGHWHUPLQDWLRQLVDPRWLRQXQGHU             ,GLVVHQW
86&  E IRU DQ RUGHU DXWKRUL]LQJ WKH ILOLQJ RI D
VXFFHVVLYHSHWLWLRQ+DG%\UGVLPSO\ILOHGKLVSHWLWLRQLQWKH
GLVWULFWFRXUWWKDWFRXUWZRXOGKDYHEHHQUHTXLUHGXQGHURXU
SUHFHGHQWWRWUDQVIHUWKHPDWWHUKHUHIRURXUGHWHUPLQDWLRQRI
ZKHWKHUWRDXWKRUL]HWKHILOLQJ6HH,QUH6LPV)G
WK&LU,QVKRUWDOOURDGVOHDGWRWKHUHTXLUHPHQW
WKDW%\UGVSHFLILFDOO\PRYHIRUDXWKRULW\WRILOHDVXFFHVVLYH
SHWLWLRQ
  +DYLQJEHHQFRQVWUDLQHGWRWUHDW%\UGjVPRWLRQDVDPRWLRQ
XQGHU86&E$DPDMRULW\RIWKLVSDQHOKDV
FRQFOXGHG WKDW WKH PRWLRQ PXVW EH GHQLHG EHFDXVH WKH
$('3$GRHVDSSO\WR%\UGjVDWWHPSWWRREWDLQKDEHDVUHOLHI
DQGWKDW%\UGFDQQRWVDWLVI\WKHUHTXLUHPHQWVLPSRVHGE\WKH
$('3$RQWKHILOLQJRIDVXFFHVVLYHKDEHDVSHWLWLRQ6HH
86&EDQG&$QGWKDWFRQFOXVLRQLVQHLWKHU
DSSHDODEOHQRULVLWSHUPLWWHGWREHWKHVXEMHFWRIDSHWLWLRQIRU
UHKHDULQJ RU D SHWLWLRQ IRU FHUWLRUDUL  6HH  86&
(
   %HFDXVHWKHFRQFOXVLRQVRIWKHPDMRULW\RIWKLVSDQHODUH
ILQDODQGQRWDSSHDODEOHWKHUHLVVLPSO\QREDVLVIRUJUDQWLQJ
DVWD\RIH[HFXWLRQRUDFRQWLQXDQFH
   ,QUH%\UG                                  1R          ,QUH%\UG                                   1R

   %HFDXVHWKHFRQFOXVLRQVRIWKHPDMRULW\RIWKLVSDQHODUH                             BBBBBBBBBBBBBB
ILQDODQGQRWDSSHDODEOHWKHUHLVVLPSO\QREDVLVIRUJUDQWLQJ
DVWD\RIH[HFXWLRQRUDFRQWLQXDQFH                                                       ',66(17
                                                                                         BBBBBBBBBBBBBB
                                                                     1$7+$1,(/5s21(6&LUFXLWsXGJHGLVVHQWLQJ,DP
                                                                  FRQYLQFHG EH\RQG GRXEW WKDW WKLV FRXUW PXVW FDUHIXOO\
                                                                  H[SORUHZKHWKHU%\UGFDQVDWLVI\WKHOHJDOVWDQGDUGWKDWZRXOG
                                                                  HQWLWOHKLPWRILOHDVHFRQGKDEHDVSHWLWLRQ7KHFRPSOH[LW\
                                                                  RIWKHLVVXHVUDLVHGE\WKHSHWLWLRQHUDUHRIVXFKVFRSHDQG
                                                                  PDJQLWXGHDVWRGHPDQGDFDUHIXODQGH[KDXVWLYHDQDO\VLV,
                                                                  EHOLHYH WKDW WKH SHWLWLRQ VTXDUHO\ LPSOLFDWHV D TXHVWLRQ RI
                                                                  IXQGDPHQWDOIDLUQHVV7KXVDVWD\RIH[HFXWLRQLVLPSHUDWLYH
                                                                  %\UGVKRXOGQRWEHSXWWRGHDWKEHIRUHWKLVFRXUWLVDEOHWR
                                                                  JLYHIXOOFRQVLGHUDWLRQWRWKHLVVXHVUDLVHGLQKLVFDVH6WHIIHQ
                                                                  Y7DWH)GWK&LU
                                                                    ,GLVVHQW
1R                                      ,QUH%\UG          1R                                                ,QUH%\UG   

1R                   ),/('6HSWHPEHU                                    
,15(s2+1:%<5's50RYDQW                                                               &21&855(1&(
                                                                                             
   ,UHTXHVWWKDWWKHHQEDQFFRXUWGHWHUPLQHZKHWKHUWRYDFDWH
WKHGD\VWD\RIH[HFXWLRQJUDQWHGE\DPDMRULW\RIWKHSDQHO           $/,&( 0 %$7&+(/'(5 &LUFXLW sXGJH VHSDUDWH
WKDWFRQVLGHUHG%\UGjVDPELJXRXVPRWLRQZKLFKWKHSDQHO               FRQFXUUHQFH  , FRQFXU HQWLUHO\ LQ sXGJH 6XKUKHLQULFKjV
WUHDWHG DV D PRWLRQ WR ILOH D VHFRQG RU VXFFHVVLYH KDEHDV    RSLQLRQ,ZULWHVHSDUDWHO\WRSRLQWRXWWKDWWKHUHLVQROHJDO
SHWLWLRQDQGGHQLHG                                                  EDVLVZKDWVRHYHUIRUWKHVWD\RIH[HFXWLRQSXUSRUWHGO\JUDQWHG
                                                                       E\ D PDMRULW\ RI WKH HQ EDQF FRXUW DSSDUHQWO\ RQ DQ RUDO
  , FDQ XQGHUVWDQG KRZ D SDQHO IDFHG ZLWK D ODVWPLQXWH      PRWLRQDQGZLWKQRWLFHWRRQO\VRPHRIWKHPHPEHUVRIWKLV
PRWLRQDQGRXWRIDQDEXQGDQFHRIFDXWLRQFRXOGVWD\DQ              FRXUW
H[HFXWLRQZKLOHLWLVFRQVLGHULQJWKHPRWLRQ,FDQXQGHUVWDQG
ZK\ D PHPEHU RI WKH SDQHO IRU WDFWLFDO RU RWKHU UHDVRQV      8QGHUVWDQGLQJ WKH SURFHGXUDO SRVWXUH RI WKLV PDWWHU LV
FRXOGUHTXHVWWKDWWKHSDQHOGHIHUDUXOLQJDQGLVVXHDVWD\          FULWLFDO WR DQ XQGHUVWDQGLQJ RI ZK\ WKHUH LV QR OHJDO EDVLV
                                                                       XSRQ ZKLFK D VWD\ RI H[HFXWLRQ DQG D FRQWLQXDWLRQ RI WKLV
   +RZHYHU , FDQQRW XQGHUVWDQG KRZ D SDQHO FDQ UHQGHU D      PDWWHU PD\ EH JUDQWHG  %\UG FRQFHGHV WKDW WKH LQLWLDO
GHFLVLRQ RQ WKH PHULWV ZKLFK DIILUPDWLYHO\ ILQGV WKDW WKH     GHWHUPLQDWLRQ RI ZKHWKHU WKH $('3$ DSSOLHV WR WKLV FDVH
SULVRQHUjVFODLPVDQGWDFWLFVKDYHQRPHULWDQGWKHQLVVXHD          PXVWEHPDGHE\WKLVFRXUWDQGQRWWKHGLVWULFWFRXUW7KH
VWD\ WR DOORZ RQH PHPEHU RI WKH SDQHO mDGGLWLRQDO WLPH WR    YHKLFOHIRUREWDLQLQJWKDWGHWHUPLQDWLRQLVDPRWLRQXQGHU
FRQVLGHU WKH PDWWHUl  :H DUH QRW D mVXSHUFRXUWl WKDW        86& E IRU DQ RUGHU DXWKRUL]LQJ WKH ILOLQJ RI D
VXSHUYLVHVDOOH[HFXWLRQVLQWKHVWDWHVZLWKLQRXUMXULVGLFWLRQ       VXFFHVVLYHSHWLWLRQ+DG%\UGVLPSO\ILOHGKLVSHWLWLRQLQWKH
2XUMXULVGLFWLRQLVOLPLWHGE\&RQVWLWXWLRQDQGVWDWXWH7KH          GLVWULFWFRXUWWKDWFRXUWZRXOGKDYHEHHQUHTXLUHGXQGHURXU
SDQHO KDV GHWHUPLQHG DOO PDWWHUV WKDW FRPH ZLWKLQ WKDW         SUHFHGHQWWRWUDQVIHUWKHPDWWHUKHUHIRURXUGHWHUPLQDWLRQRI
MXULVGLFWLRQ                                                          ZKHWKHUWRDXWKRUL]HWKHILOLQJ6HH,QUH6LPV)G
                                                                       WK&LU,QVKRUWDOOURDGVOHDGWRWKHUHTXLUHPHQW
  ,Q P\ RSLQLRQ LW LV WKHUHIRUH VLPSO\ ODZOHVV WR VWD\ DQ   WKDW%\UGVSHFLILFDOO\PRYHIRUDXWKRULW\WRILOHDVXFFHVVLYH
H[HFXWLRQDVDPDWWHURIFRPLW\WRRQHPHPEHURIWKHSDQHO            SHWLWLRQ
ZKHQWKHUHLVQRMXULVGLFWLRQDOEDVLVIRUGRLQJVR
                                                                         +DYLQJEHHQFRQVWUDLQHGWRWUHDW%\UGjVPRWLRQDVDPRWLRQ
                                                                       XQGHU86&E$DPDMRULW\RIWKLVSDQHOKDV
V'DQQ\s%RJJV                                                     FRQFOXGHG WKDW WKH PRWLRQ PXVW EH GHQLHG EHFDXVH WKH
BBBBBBBBBBBBBBBB                                                       $('3$GRHVDSSO\WR%\UGjVDWWHPSWWRREWDLQKDEHDVUHOLHI
                                                                       DQGWKDW%\UGFDQQRWVDWLVI\WKHUHTXLUHPHQWVLPSRVHGE\WKH
'DQQ\s%RJJV                                                         $('3$RQWKHILOLQJRIDVXFFHVVLYHKDEHDVSHWLWLRQ6HH
&LUFXLWsXGJH                                                          86&EDQG&$QGWKDWFRQFOXVLRQLVQHLWKHU
                                                                       DSSHDODEOHQRULVLWSHUPLWWHGWREHWKHVXEMHFWRIDSHWLWLRQIRU
                                                                       UHKHDULQJ RU D SHWLWLRQ IRU FHUWLRUDUL  6HH  86&
                                                                       (
   ,QUH%\UG                                                    1R      1R                                    ,QUH%\UG      

ODZRUSURYLGHGDQ\QHZO\GLVFRYHUHGHYLGHQFHWKH$('3$
EDUVWKHILOLQJRIDQ\VHFRQGRUVXFFHVVLYHSHWLWLRQ7KXV                       81,7('67$7(6&28572)$33($/6
%\UGjVPRWLRQIRUVWD\RIH[HFXWLRQLV'(1,('

                                                                                                    )257+(6,;7+&,5&8,7
             (17(5('%<25'(52)7+(&2857
                                                                                                        BBBBBBBBBBBBBBBBB
                           V/HRQDUG*UHHQ
             
                                                                                     ,QUHs2+1 : %<5' s5          ;
                                  &OHUN                                                                   0RYDQW         
                                                                                                                           !
                                                                                                                          
                                                                                                                         1     1R

                                                                                                     )LOHG6HSWHPEHU
                                                                                                        BBBBBBBBBBBBBBBBB
                                                                                                             25'(5
                                                                                                        BBBBBBBBBBBBBBBBB
                                                                                       $PHPEHURIWKHFRXUWKDVUHTXHVWHGWKDWWKHHQEDQFFRXUW
                                                                                    GHWHUPLQHZKHWKHUWRYDFDWHWKHVWD\RIH[HFXWLRQLQFOXGHGLQ
                                                                                    LWV6HSWHPEHUGHFLVLRQRQWKHPRYDQWjVUHTXHVWIRU
                                                                                    DGHWHUPLQDWLRQWKDW86&EGRHVQRWDSSO\WR
                                                                                    KLPDQGKLVUHTXHVWIRUDVWD\RIH[HFXWLRQZKLOHKHSXUVXHV
                                                                                    DVHFRQGIHGHUDOKDEHDVSHWLWLRQ
                                                                                       7KHUHTXHVWIRUDQHQEDQFGHWHUPLQDWLRQKDVEHHQUHIHUUHG
                                                                                    WRDOORIWKHDFWLYHMXGJHVRIWKHFRXUWOHVVWKDQDPDMRULW\RI
                                                                                    ZKRPKDYHYRWHGLQIDYRURIYDFDWLQJWKHVWD\$PDMRULW\
                                                                                    RIWKHDFWLYHMXGJHVKDYHYRWHGWRH[WHQGWKHVWD\RIH[HFXWLRQ
                                                                                    XQWLO2FWREHULQDGGLWLRQWKHFOHUNRIWKHFRXUWLV
                                                                                    GLUHFWHGWRILOHDQGVXEPLWWRWKHFRXUWDQ\SHWLWLRQRIIHUHGE\
                                                                                    DSDUW\VHHNLQJHQEDQFUHYLHZRIWKHGHFLVLRQRIWKHSDQHO
     ,QUH%\UG                        1R   1R                                      ,QUH%\UG     

    ,7,66225'(5('                                 VHHDOVR(OOLVY&ROOLQV)GWK
                                                      &LUKROGLQJWKDWDVWDWHWULDOFRXUWjVVXPPDU\GHWHUPLQDWLRQ
             (17(5('%<25'(52)7+(&2857            WKDWDIILGDYLWVODFNHGFUHGLELOLW\ZDVHQWLWOHGWRDSUHVXPSWLRQ
                                                      RI FRUUHFWQHVV LQ IHGHUDO KDEHDV FRUSXV SURFHHGLQJV FHUW
                                                      GHQLHG  86    )RU WKH UHDVRQV DUWLFXODWHG
                 V/HRQDUG*UHHQ                    DERYHZHILQGDEVROXWHO\QREDVLVWRGLVWXUEWKDWILQGLQJ
             BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB
                 /HRQDUG*UHHQ&OHUN                  %\UGjV UHTXHVW IRU DQ HYLGHQWLDU\ KHDULQJ PXVW DOVR EH
                                                      UHMHFWHG EHFDXVH KH IDLOHG WR GLOLJHQWO\ GHYHORS IDFWV LQ
                                                      VXSSRUWRIKLVFODLPDQGFDQQRWVKRZFDXVHDQGSUHMXGLFH
                                                      6HH:LOOLDPVY7D\ORU86QRWLQJ
                                                      WKDW  86&  jV OLPLWDWLRQ RQ HYLGHQWLDU\ KHDULQJV
                                                      FRGLILHV DQG VWUHQJWKHQV SUH$('3$ GXH GLOLJHQFH
                                                      UHTXLUHPHQW HVWDEOLVKHG E\ .HHQH\ Y 7DPD\R5H\HV 
                                                      86    $QG LQ DOO HYHQWV %\UG KDG D SUHYLRXV
                                                      RSSRUWXQLW\ WR H[SORUH KLV DFWXDO LQQRFHQFH o LQ KLV ILUVW
                                                      IHGHUDOKDEHDVSHWLWLRQ%\UGjVUHTXHVWLVUHMHFWHG
                                                                                      9
                                                         %\UGjV UHQHZHG DWWDFNV RQ WULDO ZLWQHVV $UPVWHDGjV
                                                      FUHGLELOLW\WRWKHH[WHQWWKH\DUHQRWEDUUHGXQGHU86&
                                                       E GR QRW SURYLGH SURRI RI mDFWXDO LQQRFHQFHl
                                                      VXIILFLHQWWRH[FXVHDQDEXVHRIWKHZULW&I&ODUNY/HZLV
                                                      )GWK&LUDOOHJDWLRQWKDWSURVHFXWLRQ
                                                      ZLWQHVV FRXOG KDYH EHHQ LPSHDFKHG E\ DOOHJHGO\ ZLWKKHOG
                                                      HYLGHQFH GLG QRW FRQVWLWXWH D FUHGLEOH FODLP RI mDFWXDO
                                                      LQQRFHQFHlVXIILFLHQWWRVKRZWKDWWKHSHWLWLRQHUZDVDFWXDOO\
                                                      LQQRFHQWRIWKHGHDWKSHQDOW\
                                                                                     9,
                                                        )RU DOO WKH IRUHJRLQJ UHDVRQV %\UGjV UHTXHVW IRU DQ
                                                      H[HPSWLRQ IURP  E RI WKH $('3$ LV '(1,('
                                                      )XUWKHUEHFDXVH%\UGKDVFLWHGQRQHZUXOHRIFRQVWLWXWLRQDO
    ,QUH%\UG                                      1R       1R                                           ,QUH%\UG        

  :RRGDOODOVRLPSOLFDWHG%\UGLQ$XJXVWOHVVWKDQD
PRQWKDIWHUKLVWULDOZKHQKHWROGDSULVRQVRFLDOZRUNHUWKDW         81,7('67$7(6&28572)$33($/6
KHRQO\GURYHWKHYDQDQGWKDW%\UGVDLGKHVWDEEHGWKHVWRUH
FOHUN  ,Q WZR OHWWHUV ZULWWHQ RQ $XJXVW   DQG                            )257+(6,;7+&,5&8,7
6HSWHPEHU   :RRGDOO DVNHG WKDW KH QRW EH VHQW WR                            BBBBBBBBBBBBBBBBB
/XFDVYLOOHEHFDXVH%\UGZDVWKHUHDQG%\UGZDVPDGDWKLP
:RRGDOO DOVR LQGLFWHG WKDW %\UG ZDV XQWUXWKIXOO\ EODPLQJ
%UHZHUIRUWKHVWDEELQJs$                               ,QUH s2+1 : %<5' s5          ;
                                                                                            0RYDQW          
   /LNH%UHZHUjVYDULRXVVWDWHPHQWVRYHUWKH\HDUV:RRGDOOjV                                                
VWDWHPHQWV DUH FRQWUDGLFWRU\  $FFRUGLQJ WR IRUPHU LQPDWH                                                 1R
'DQ&DKLOO:RRGDOOWROGKLPZKLOHERWKZHUHZRUNLQJDV                                                     
                                                                                                              !
2KLR 3ULVRQ ,QGXVWULHV FOHUNV WKDW %\UG GLG QRW VWDE                                                
7HZNVEXU\DQGWKDWWKHZURQJPDQZDVRQGHDWKURZs$                                                   1
  ,Q  :RRGDOO VLJQHG DQ DIILGDYLW IRU WKH 2KLR                          )LOHG6HSWHPEHU
3XEOLF'HIHQGHUjVRIILFHLQZKLFKKHVWDWHGWKDW%UHZHUQRW
%\UGFDUULHGWKHNQLIHDWDOOWLPHVDQGWKDWZKHQKHOHIWWKH            %HIRUHs21(668+5+(,15,&+%$7&+(/'(5
.LQJ .ZLN VWRUH WKH NQLIH %UHZHU ZDV VWLOO FDUU\LQJ ZDV                           &LUFXLWsXGJHV
FRYHUHGZLWKEORRGs$                                                    BBBBBBBBBBBBBBBBB
   ,URQLFDOO\%\UGVWDWHVLQKLV0HPRUDQGXPWKDWKHGLGQRW            $0(1'(' 25'(5 '(1<,1* s2+1 %<5'j6
VXEPLW:RRGDOOjVDIILGDYLWLQWKHVWDWHSRVWFRQYLFWLRQSHWLWLRQ         027,21 72 '(7(50,1( :+(7+(5  86&
mEHFDXVH RI FRQFHUQV DERXW KLV UHOLDELOLW\l  %\UGjV             E2)7+($('3$$33/,(672+,6&$6(
0HPRUDQGXPLQ6XSSRUWDW%UHZHUjVYDU\LQJVWDWHPHQWV                              BBBBBBBBBBBBBBBBB
VKDUHWKHVDPHFRQVLVWHQWO\LQFRQVLVWHQWVWRULHVDQGZHVKDUH
%\UGjVmFRQFHUQVDERXW>%UHZHUjV@UHOLDELOLW\l,QVKRUWWKH            68+5+(,15,&+&LUFXLWsXGJH0RYDQWsRKQ:%\UG
HYLGHQFH EHIRUH XV LV KRSHOHVVO\ FRQWUDGLFWRU\  ERWK           VFKHGXOHGWREHH[HFXWHGE\WKH6WDWHRI2KLRRQ6HSWHPEHU
LQWHUQDOO\ DQG DV EHWZHHQ WKH WZR FRGHIHQGDQWV  7KLV LV        DW  DP VHHNV D VWD\ RI H[HFXWLRQ ZKLOH KH
VLPSO\QRWFOHDUDQGFRQYLQFLQJHYLGHQFHWKDWZRXOGDOORZXV            SXUVXHVDVHFRQGIHGHUDOKDEHDVSHWLWLRQ %\UGDOVRDVNVWKLV
WRFRQFOXGHWKDWQRUHDVRQDEOHMXURUZRXOGKDYHIRXQG%\UG
HOLJLEOH IRU WKH GHDWK SHQDOW\  %\UGjV HYLGHQFH GRHV QRW
VDWLVI\WKH6DZ\HUVWDQGDUG                                                
                                                                              %\UG GRHV QRW FKDUDFWHUL]H KLV PRWLRQ DV VXFK 5DWKHU WKH PRWLRQ
                                                                        LV VW\OHG DV msRKQ %\UGjV 0RWLRQ >WR@ 'HWHUPLQH :KHWKHU  86&
                                ,9                                      E RI WKH $('3$ $SSOLHV WR +LV &DVHl $V UHOLHI KH UHTXHVWV WKDW
                                                                        mWKLV &RXUW >@ GHWHUPLQH WKDW   RI WKH $('3$ GRHV QRW DSSO\ WR
   %\UGDVNVXVLQWKHDOWHUQDWLYHWRUHPDQGKLVFDVHWRWKH            KLPl ,Q WKH DOWHUQDWLYH KH mDVNV WKH &RXUW WR JUDQW D VWD\ DQG UHPDQG KLV
GLVWULFWFRXUWIRUDQHYLGHQWLDU\KHDULQJ+RZHYHUWKH2KLR           FDVH WR WKH GLVWULFW FRXUW IRU DQ HYLGHQWLDU\ KHDULQJ LQWR ZKHWKHU KLV
VWDWHFRXUWVKDYHDOUHDG\UHMHFWHGKLVQHZHYLGHQFHRIDFWXDO           HYLGHQFH PHHWV 6FKOXSjV DFWXDO LQQRFHQFH JDWHZD\ VWDQGDUG IRU ILOLQJ D

LQQRFHQFHILQGLQJWKDWLWODFNHGDQ\FUHGLELOLW\7KLVIDFWXDO        VHFRQG SHWLWLRQl +H DOVR VWDWHV WKDW m>L@I WKH &RXUW GHWHUPLQHV WKDW
                                                                         E GRHV QRW DSSO\ WR %\UGjV FDVH KH ZLOO LPPHGLDWHO\ ILOH LQ WKH
ILQGLQJ LV HQWLWOHG WR D SUHVXPSWLRQ RI FRUUHFWQHVV LQ ODWHU   GLVWULFW FRXUW WKH VHFRQG KDEHDV SHWLWLRQ KH WHQGHUHG WR WKLV PRWLRQl
IHGHUDOKDEHDVFRUSXVFDVHV3DWWRQY<RXQW86           +RZHYHU FDVW %\UG LV VHHNLQJ WKH SHUPLVVLRQ UHTXLUHG E\  86&
     ,QUH%\UG                                     1R      1R                                     ,QUH%\UG     

&RXUW WR GHWHUPLQH WKDW  86&  E WKH $QWL       s$)XUWKHUPRUH0DUN(3LHSPHLHUDQDVVLVWDQW
7HUURULVPDQG(IIHFWLYH'HDWK3HQDOW\$FWm$('3$lZKLFK             +DPLOWRQ&RXQW\3URVHFXWRUDWWHVWHGWKDW
EDUVVHFRQGRUVXFFHVVLYHSHWLWLRQVXQOHVVWKH\DUHEDVHGRQ
IDFWV ZKLFK FRXOG QRW KDYH EHHQ GLVFRYHUHG SUHYLRXVO\              , YLVLWHG 0U :RRGDOO DW WKH /RQGRQ &RUUHFWLRQDO
WKURXJKWKHH[HUFLVHRIGXHGLOLJHQFHGRHVQRWDSSO\WRKLP           )DFLOLW\ RQ sDQXDU\   DORQJ ZLWK DVVLVWDQW
)RU WKH IROORZLQJ UHDVRQV %\UGjV PRWLRQ IRU VWD\ RI            +DPLOWRQ&RXQW\3URVHFXWRU:LOOLDP(%UH\HUDQG6W
H[HFXWLRQLV'(1,('%\UGjVUHTXHVWWRILOHDVHFRQGKDEHDV            /W+RZDUG+XGVRQRIWKH2KLR6WDWH+LJKZD\3DWURO
SHWLWLRQLVDOVR'(1,('DVEDUUHGXQGHU ERIWKH               
$('3$
                                                                        ,ZDVSUHVHQWZKHQ0U:RRGDOOPDGHWKHVWDWHPHQWV
                                   ,                                   FRQWDLQHGLQWKHDIILGDYLWRI+RZDUG+XGVRQ
   %\UGZDVFRQYLFWHGE\DMXU\DQGVHQWHQFHGLQ+H              ,PDGHDIROORZXSYLVLWWR0U:RRGDOODWWKH2KLR
ZDVRULJLQDOO\VFKHGXOHGWREHH[HFXWHGRQsDQXDU\            6WDWH 8QLYHUVLW\ +RVSLWDO RQ :HGQHVGD\ sDQXDU\ 
%\UGjV FRQYLFWLRQV DQG VHQWHQFHV ZHUH XSKHOG RQ GLUHFW           DORQJZLWKDVVLVWDQW+DPLOWRQ&RXQW\3URVHFXWRU
DSSHDOWRWKH2KLR&RXUWRI$SSHDOVVHH6WDWHY%\UG1R&          :LOOLDP(%UH\HU
 % 2KLR &W $SS )HE   RQ GLUHFW
DSSHDO WR WKH 2KLR 6XSUHPH &RXUW VHH 6WDWH Y %\UG       0U%UH\HUDQG,VSRNHWR0U:RRGDOOLQDKRVSLWDO
1(G  2KLR  DQG WKH 6XSUHPH &RXUW GHQLHG            URRP DW WKH 2KLR 6WDWH 8QLYHUVLW\ +RVSLWDO RQ
FHUWLRUDUL6HH%\UGY2KLR86%\UGDOVR          sDQXDU\    0U :RRGDOO VDLG KLV PHGLFDO
ILOHGDPRWLRQIRUDQHZWULDOLQ'HFHPEHUZKLFKWKH              FRQGLWLRQKDGZRUVHQHGDQGKHUHDOL]HGKHGLGQRWKDYH
WULDO FRXUW GHQLHG LQ 6HSWHPEHU   7KH 2KLR &RXUW RI      ORQJWROLYH
$SSHDOV XSKHOG WKH WULDO FRXUW VHH 6WDWH Y %\UG 1R &
2KLR&W$SS)HEDQGWKH2KLR6XSUHPH              0U:RRGDOOFRQILUPHGWKDWHYHU\WKLQJKHKDGWROG
&RXUWVXEVHTXHQWO\GHFOLQHGMXULVGLFWLRQ6HH6WDWHY%\UG           P\VHOI0U%UH\HUDQG+RZDUG+XGVRQRQsDQXDU\
1(G2KLR                                            ZDVWUXH

  ,Q%\UGILOHGKLVILUVWSHWLWLRQIRUVWDWHSRVWFRQYLFWLRQ        0U:RRGDOOVDLGWKDWsRKQQ\%UHZHUKDGZULWWHQWR
UHOLHI ZKLFK WKH WULDO FRXUW GHQLHG  7KH 2KLR &RXUW RI      KLPVHYHUDOWLPHVDQGWROGKLPWKDWKHZDVJRLQJWROLH
$SSHDOVUHYHUVHGLQDQGUHPDQGHGWKHFDVHIRUIXUWKHU              RQEHKDOIRI0U%\UGDQGHQFRXUDJHG0U:RRGDOOWR
SURFHHGLQJV  2Q UHPDQG WKH WULDO FRXUW DJDLQ HQWHUHG           GRWKHVDPH
VXPPDU\ MXGJPHQW IRU WKH VWDWH DQG %\UG DSSHDOHG  7KH
2KLR &RXUW RI $SSHDOV DIILUPHGVHH 6WDWH Y %\UG 1R &     s$:RRGDOOGLHGRQ$SULO
2KLR&W$SS)HEDQGWKH2KLR6XSUHPH
&RXUWGHFOLQHGMXULVGLFWLRQ6HH6WDWHY%\UG1(G
2KLR

 E$ WR ILOH DV VHFRQG KDEHDV SHWLWLRQ
    ,QUH%\UG                                    1R     1R                                          ,QUH%\UG        

+XGVRQ ,,, D VWDII OLHXWHQDQW DVVLJQHG WR WKH 2IILFH RI     %\UG ILOHG KLV LQLWLDO SHWLWLRQ IRU ZULW RI KDEHDV FRUSXV
,QYHVWLJDWLYH6HUYLFHVZLWKWKH2KLR6WDWH+LJKZD\3DWURO          XQGHU86&GRQ0DUFK7KHGLVWULFW
VWDWHGLQKLVDIILGDYLWWKDW                                       FRXUWGHQLHGDQHYLGHQWLDU\KHDULQJDQGKDEHDVUHOLHILQ
                                                                    %\UGY&ROOLQV1R&VOLSRS6'2KLRsXO\
    0U :RRGDOO H[SUHVVHG H[WUHPH UHPRUVH RYHU WKH        %\UG Y &ROOLQV 1R & VOLS RS 1RY 
  GHDWKRI0RQWH7HZNVEXU\VWDWHGWKDWKHZDVG\LQJIURP             /DVW \HDU RYHU GLVVHQW WKLV &RXUW DIILUPHG WKH
  OXQJFDQFHUDQGKDGEHHQWROGKHKDVQRPRUHWKDQD\HDU          MXGJPHQWRIWKHGLVWULFWFRXUW%\UGY&ROOLQV)G
  WROLYHDQGWKDWKHKDGPDGHKLVSHDFHZLWK*RG                 WK&LU$GLYLGHGFRXUWGHQLHG%\UGjVSHWLWLRQIRU
                                                                    UHKHDULQJHQEDQF%\UGY&ROOLQV1RDPHQGHGHQ
    0U :RRGDOO VDLG WKDW \HDU DJR ZKLOH KH ZDV        EDQF RUGHU  WK &LU $XJ    7KH 8QLWHG 6WDWHV
  FRQILQHGDWWKH6RXWKHUQ2KLR&RUUHFWLRQDO)DFLOLW\LQ            6XSUHPH&RXUWGHQLHG%\UGjVSHWLWLRQIRUZULWRIFHUWLRUDULRQ
  /XFDVYLOOH2KLRKHVLJQHGDIILGDYLWVIRUWKH2KLR3XEOLF        sDQXDU\%\UGY&ROOLQV867KH
  'HIHQGHUZKLFKZHUHQRWWUXH+HVLJQHGWKHVHDWWKH             GLVWULFW FRXUW VXEVHTXHQWO\ LVVXHG D PDQGDWH GLVPLVVLQJ
  UHTXHVW RI LQPDWH sRKQQ\ %UHZHU WR KHOS LQPDWH sRKQ       %\UGjVKDEHDVSHWLWLRQRQsDQXDU\
  %\UG sU  5HFHQWO\ KH KDV EHHQ DVNHG RQ QXPHURXV
  RFFDVLRQV WR PHHW ZLWK WKH 2KLR 3XEOLF 'HIHQGHUjV             2Q sDQXDU\   %\UG ILOHG D PRWLRQ LQ WKH 2KLR
  UHSUHVHQWLQJsRKQ%\UGsUEXWWKDWKHKDVUHIXVHGWRGR        6XSUHPH&RXUWVHHNLQJDVWD\RIH[HFXWLRQWRSHUPLWKLPWR
  VR                                                               OLWLJDWHWKHLVVXHRIKLVDFWXDOLQQRFHQFHRIWKHGHDWKSHQDOW\
                                                                    2Q0DUFKWKH2KLR6XSUHPH&RXUWLVVXHGDQHQWU\
  0U:RRGDOOVDLGWKDWsRKQQ\%UHZHUQHYHUWROGKLP           SHUPLWWLQJ%\UGWRILOHDVHFRQGVWDWHSRVWFRQYLFWLRQSHWLWLRQ
  WKDWKHKDGNLOOHG0RQWH7HZNVEXU\0U:RRGDOOZDV              LQWKHWULDOFRXUWDQGUHPDQGLQJWKHFDVHIRUDKHDULQJRQWKH
  VKRZQ WKH VWDWHPHQW LQ sRKQQ\ %UHZHUjV DIILGDYLW            FODLPWKDWKHZDVDFWXDOO\LQQRFHQWRIWKHGHDWKSHQDOW\7KH
  QXPEHUHGZKHUHLQKHVWDWHGm:KHQ,JRWEDFNLQWKH           2KLR 6XSUHPH &RXUWjV HQWU\ VHW %\UGjV H[HFXWLRQ GDWH IRU
  YDQ,VDLGWR'DQQ\:RRGDOOµ0DQ,VWDEEHGDJX\WDNH           6HSWHPEHU6WDWHY%\UG1(G
  RIIjl0U:RRGDOOVDLGWKDWGLGQRWKDSSHQ
                                                                       %\UG ILOHG D SHWLWLRQ IRU SRVWFRQYLFWLRQ UHOLHI LQ WKH
    0U :RRGDOO VWDWHG WKDW ZKHQ sRKQ %\UG sU DQG    +DPLOWRQ&RXQW\2KLRWULDOFRXUWRQ$SULO,QLWKH
  sRKQQ\%UHZHUUHWXUQHGWRWKHYDQDIWHUFRPLQJRXWRI             UDLVHGLQWHUDOLDWKHFODLPWKDWKHZDVDFWXDOO\LQQRFHQWRI
  .LQJ.ZLNWKDWsRKQ%\UGsUKDGWKHNQLIH                     WKH GHDWK SHQDOW\  %\UG EDVHG KLV ILUVW FODLP RQ WKH 
                                                                    DIILGDYLW RI FRGHIHQGDQW sRKQ %UHZHU LQ ZKLFK %UHZHU
    0U :RRGDOO VWDWHG WKDW ZKLOH FRQILQHG DW WKH $    DOOHJHV WKDW KH QRW %\UG DFWXDOO\ PXUGHUHG 0RQWH
  %ORFN RI WKH &LQFLQQDWL :RUNKRXVH DZDLWLQJ WULDO LQ        7HZNVEXU\,QKLVVHFRQGFODLP%\UGDOOHJHGWKDWWKHWULDO
   sRKQ %\UG sU WROG EODFN LQPDWHV ZKR ZHUH          WHVWLPRQ\RIVWDWHjVZLWQHVV5RQDOG$UPVWHDGDQGWKHJUDQG
  KDUDVVLQJ KLP QRW WR PHVV ZLWK KLP EHFDXVH KH KDG        MXU\ WHVWLPRQ\ RI VWDWH ZLWQHVV 9LUJLO sRUGDQ ZHUH QRW
  DOUHDG\NLOOHGDPDQDQGZDVQjWDIUDLGWRNLOODJDLQ             FUHGLEOH  +H DOVR UHTXHVWHG GLVFRYHU\ RI UHFRUGV IURP WKH
                                                                    SURVHFXWRUjVRIILFHDQGWKHVWDWHGHSDUWPHQWRIFRUUHFWLRQV
  0U:RRGDOOVDLGWKHRZQHURIWKHYDQXVHGGXULQJ            7KH WULDO FRXUW GHQLHG %\UGjV GLVFRYHU\ UHTXHVWV DQG
  WKHPXUGHURI0RQWH7HZVNEXU\/HUR\7XQVWDOOYLVLWHG
  KLPLQMDLOVKRUWO\DIWHUWKHFULPHV0U:RRGDOOWROG
  /HUR\ 7XQVWDOO WKDW sRKQ %\UG sU ZDV WKH RQH ZKR           
                                                                         )RU D WKRURXJK UHYLHZ RI WKH XQGHUO\LQJ HYHQWV VHH %\UG Y &ROOLQV
  PXUGHUHG0RQWH7HZNVEXU\                                          )G  WK &LU  FHUW GHQLHG  86  
      ,QUH%\UG                                      1R    1R                                         ,QUH%\UG     

GLVPLVVHG %\UGjV SRVWFRQYLFWLRQ SHWLWLRQ ZLWKRXW DQ             ZDVQRORQJHUVXEMHFWWRIXUWKHUSXQLVKPHQWIRUKLVDFWLRQVLQ
HYLGHQWLDU\ KHDULQJ RQ 0D\    6WDWH %\UG 1R %    WKDWUREEHU\DQGPXUGHU%\ZDLWLQJWRSURYLGHWKHVWDWHPHQW
$+DPLOWRQ&30D\5HJDUGLQJWKH                XQWLO%UHZHUFRXOGDUJXDEO\VKLHOGERWKKLPVHOIDQG
%UHZHUDIILGDYLWWKHFRXUWKHOG                                   %\UG IURP WKH GHDWK SHQDOW\ EHFDXVH RI GRXEOH MHRSDUG\
                                                                      6XFKWDFWLFDOPDQHXYHUVUHQGHUWKHDIILGDYLWKLJKO\VXVSHFW
    %\UGDQGKLVDWWRUQH\VDJUHHWKDWWKH\UHFHLYHG%UHZHUjV
    DIILGDYLWLQ)RUWDFWLFDOUHDVRQVWKH\GLGQRW          )XUWKHUPRUH%UHZHUjVDIILGDYLWFRQWUDGLFWVKLVRZQWULDO
    ILOHWKHDIILGDYLWRUPDNHLWNQRZQWRWKLVRUDQ\FRXUWDW       WHVWLPRQ\,Q$XJXVW%UHZHUWHVWLILHGDWKLVRZQWULDO
    WKDWWLPHHYHQWKRXJK%\UGKDGDPRWLRQIRUDQHZWULDO           +HVWDWHGWKDWKHGLGQRWSDUWLFLSDWHLQWKHNLOOLQJRI0RQWH
    SHQGLQJ DW WKDW WLPH  %\UG LQ  ZDV SXUVXLQJ DQ   7HZNVEXU\DQGZDVQRWDWWKH.LQJ.ZLN%UHZHU7U
    DSSHDODQGDPRWLRQIRUQHZWULDOFRQWHQGLQJLQSDUWWKDW         1RWORQJDIWHUKLVWULDOZKLOHDZDLWLQJSODFHPHQWLQD
    %\UGZDVQRWHYHQDWWKHVFHQHRIWKHFULPHRQWKHQLJKW          VWDWHSHQDOLQVWLWXWLRQ%UHZHUWROGDSULVRQVRFLDOZRUNHUDQG
    LQTXHVWLRQ%UHZHUjVDIILGDYLWSXWV%\UGVTXDUHO\DWWKH        DSV\FKRORJ\DVVLVWDQWRQ$XJXVWDQG$XJXVW
    FULPHVFHQH                                                    WKDW %\UG NLOOHG 7HZVNEXU\  ,Q 6HSWHPEHU  KH DOVR
                                                                      ZURWH OHWWHUV WR WKH SDUROH DXWKRULW\ VWDWLQJ WKDW KH GLG QRW
       $VDFRQVHTXHQFHRIWKLVWDFWLFDOGHFLVLRQE\%\UGDQG         ZDQW WR EH VHQW WR WKH /XFDVYLOOH SULVRQ ZKHUH %\UG DQG
    KLVDWWRUQH\V%\UGLVQRZEDUUHGXQGHU&ULPLQDO5XOH            :RRGDOOZHUHDQGUHLWHUDWLQJWKDWKHNQHZQRWKLQJDERXWWKH
    IURPILOLQJDPRWLRQIRUDQHZWULDOEHFDXVHDVKLV          NLOOLQJs$
    DWWRUQH\FRQFHGHGLQRUDODUJXPHQWWKHDIILGDYLWLV
    QRWQHZO\GLVFRYHUHGHYLGHQFH                                     %\UG DFNQRZOHGJHV WKHVH IDFWV LQ KLV 0HPRUDQGXP LQ
                                                                      6XSSRUWEXWQRQHWKHOHVVDWWHPSWVWRH[SODLQWKHLQFRQVLVWHQF\
      %\UG DQG KLV DWWRUQH\V QRZ LQVLVW WKDW WKH          ZLWKKLVDIILGDYLWVDVmXQGHUVWDQGDEOHlEHFDXVHm>W@ZHQW\\HDU
    DIILGDYLWLVWUXH7KXV%\UGFRQFHGHVWKDWWKHSRVLWLRQ         ROGGHIHQGDQWVZKRJRRQWULDODUHQRWHDJHUWREHFRQYLFWHG
    KHSXUVXHGLQFRXUWIRUVRORQJWKDWKHZDVQRWDWWKH           RIVHULRXVFULPHVZLWKORQJVHQWHQFHVl%\UGjV0HPRUDQGXP
    FULPHVFHQHLVXQWUXH%\UGQRZFRQFHGHVWKDWKHZDV            LQ 6XSSRUW DW   %\UG IXUWKHU DWWHPSWV WR PLQLPL]H WKH
    WKHUHEXWWKDW%UHZHUQRW%\UGVWDEEHGWKHYLFWLP            DEVROXWHFRQWUDGLFWLRQVE\SURFODLPLQJWKDWm%UHZHUUHDGLO\
                                                                      DGPLWVLQKLVDIILGDYLWWKDWKLVWULDOWHVWLPRQ\ZDVQRW
       7KHDIILGDYLWRI%UHZHULQODFNVDQ\FUHGLELOLW\          WUXWKIXOl  ,G  7KH TXHVWLRQ IRU WKLV &RXUW WKHQ LV m:DV
    ZKDWVRHYHU7KHDIILGDYLWLVLQFRQVLVWHQWZLWKKLV          %UHZHU O\LQJ LQ  ZDV %UHZHU O\LQJ LQ  RU LV KH
    DIILGDYLWWRVD\QRWKLQJRIKLVVZRUQWHVWLPRQ\DW           O\LQJ QRZ"l  7KLV LV FHUWDLQO\ QRW WKH NLQG RI mFOHDU DQG
    KLV WULDO  $V WKH 6WDWH DFFXUDWHO\ SRLQWV RXW %UHZHU   FRQYLQFLQJHYLGHQFHlWKDWZRXOGSUHYHQWDQ\UHDVRQDEOHMXURU
    FRQWLQXHG WR PDNH VWDWHPHQWV LGHQWLI\LQJ %\UG DV WKH       IURPILQGLQJ%\UGHOLJLEOHIRUWKHGHDWKSHQDOW\
    SULQFLSDORIIHQGHUZHOOLQWRKLVSHULRGRILQFDUFHUDWLRQWR
    D YDULHW\ RI SHRSOH  7KH %UHZHU DIILGDYLW ODFNV DQ\        7KHUH LV DOVR WKH G\LQJ GHFODUDWLRQ RI WKH WKLUG FR
    FUHGLELOLW\IRUDYDULHW\RIUHDVRQVLQFOXGLQJWKRVHFLWHG        GHIHQGDQW:LOOLDP:RRGDOO:RRGDOOZDVGLDJQRVHGODWH
    E\WKH6WDWHGXULQJRUDODUJXPHQW7KHDIILGDYLWVIDLOWR        ODVW\HDUZLWKWHUPLQDOFDQFHU2QsDQXDU\KHZDV
    PHHW WKH VWDQGDUG VHW IRUWK LQ+HUUDUD Y &ROOLQV     UXVKHGWRWKHORFDOKRVSLWDOEHFDXVHKHZDVVXIIHULQJIURP
    86                                                mFKHVW SDLQV SRVVLEOH KHDUW DWWDFNl  s$   7ZR
                                                                      SURVHFXWRUVDQGDVWDWHKLJKZD\SDWUROPDQZHQWWRVHHKLP
7KHWULDOFRXUWUXOHGWKDWWKHFODLPRIDFWXDOLQQRFHQFHEDVHG        ,QVLJQHGDIILGDYLWVUHFRXQWLQJWKHLULQWHUYLHZWKH\FODLPWKDW
RQ$UPVWHDGjVODFNRIFUHGLELOLW\ZDVEDUUHGE\UHVMXGLFDWD         :RRGDOOEODPHG%\UGIRU7HZNVEXU\PXUGHU+RZDUG+
     ,QUH%\UG                                           1R         1R                                          ,QUH%\UG          

VWDQGDUG DSSOLHV WR FODLPV RI DFWXDO LQQRFHQFH RI WKH                     7KH 2KLR &RXUW RI $SSHDOV DIILUPHG WKH WULDO FRXUWjV
XQGHUO\LQJFRQYLFWLRQ,GDW%\UGLVQRWFKDOOHQJLQJKLV                 MXGJPHQWRQ$XJXVW6WDWHY%\UG1R&
XQGHUO\LQJ FRQYLFWLRQ EXW RQO\ KLV VHQWHQFH  6HH %\UGjV               :/+DPLOWRQ&W$SS$XJSHU
0HPRUDQGXP LQ 6XSSRUW DW   Q  7KXV WKH                     FXULDP7KHDSSHDOVFRXUWVWDWHGLQUHOHYDQWSDUW
DSSURSULDWH VWDQGDUG RI UHYLHZ KHUH LV WKH mFOHDU DQG
FRQYLQFLQJVWDQGDUGIRXQGLQ6DZ\HUmZKLFKZDVIDVKLRQHG                         ,QKLVILUVWFODLPIRUUHOLHI%\UGFRQWHQGHGWKDWKHZDV
WRUHIOHFWWKHUHODWLYHLPSRUWDQFHRIDFODLPRIDQHUURQHRXV                     mDFWXDOO\LQQRFHQWlRIDJJUDYDWHGPXUGHUEHFDXVHKLVFR
VHQWHQFHl,G                                                                 GHIHQGDQWsRKQ%UHZHUNLOOHG7HZNVEXU\%\UGFLWHGWR
                                                                                  SRUWLRQVRIWKHWULDOWUDQVFULSWDQGPDWHULDODGGXFHGDWKLV
   ,Q6DZ\HUWKH6XSUHPH&RXUWKHOGWKDWLQRUGHUIRUDFRXUW                    WULDO WR GHPRQVWUDWH WKDW %UHZHU ZDV WKH NLOOHU  %\UG
WRUHDFKWKHPHULWVRIDSHWLWLRQHUjVVXFFHVVLYHFODLPWKDWKH                    DGGLWLRQDOO\SUHVHQWHGWZRDIILGDYLWVVLJQHGE\%UHZHU
LV mDFWXDOO\ LQQRFHQWl RI WKH GHDWK SHQDOW\ WKH SHWLWLRQHU               RQ0D\DQGsDQXDU\UHVSHFWLYHO\LQ
mPXVWVKRZE\FOHDUDQGFRQYLQFLQJHYLGHQFHWKDWEXWIRUD                       ZKLFK %UHZHU FODLPHG WKDW KH DQG QRW %\UG IDWDOO\
FRQVWLWXWLRQDOHUURUQRUHDVRQDEOHMXURUZRXOGKDYHIRXQGWKH                    VWDEEHG7HZNVEXU\%\UGDOVRSUHVHQWHGWKHDIILGDYLWRI
SHWLWLRQHUHOLJLEOHIRUWKHGHDWKSHQDOW\XQGHUWKHDSSOLFDEOH                    'DQ&DKLOODIHOORZLQPDWHRI%UHZHUDWWKH6RXWKHUQ
VWDWHODZl6DZ\HU86DW%\UGFDQQRWPHHWWKLV                      2KLR&RUUHFWLRQDO)DFLOLW\ZKRFODLPHGWKDW%UHZHUKDG
VWDQGDUG                                                                       WROGKLPWKDWKHPXUGHUHG7HZNVEXU\
  %\UGjVRQO\HYLGHQFHLVWKHILUVW%UHZHUDIILGDYLW,WZDV                     
PDGH LQ  VL[ \HDUV DIWHU KH KDG EHHQ FRQYLFWHG DQG
VHQWHQFHGIRUKLVSDUWLQWKH7HZNVEXU\UREEHU\DQGPXUGHU                       ,Q WKLV FDVH WKH WULDO FRXUW GLVPLVVHG %\UGjV FODLP RI
6HH6WDWHY%UHZHU1R&:/2KLR&W                         mDFWXDOLQQRFHQFHlIRUWZRUHDVRQVILUVWEHFDXVHLWGLG
$SSsXO\DIILUPLQJ%UHZHUjVFRQYLFWLRQRQGLUHFW                      QRW JLYH ULVH WR D FRQVWLWXWLRQDO YLRODWLRQ LQ WKH
DSSHDO7KXV%UHZHUjVFRQIHVVLRQZDVPDGHRQO\DIWHUKH                        SURFHHGLQJVWKDWUHVXOWHGLQKLVFRQYLFWLRQDQGVHFRQG
                                                                                  EHFDXVH WKH HYLGHQWLDU\ EDVLV IRU WKH FODLPo sRKQ
                                                                                  %UHZHUjV VWDWHPHQW WKDW KH KDG DFWXDOO\ NLOOHG
                                                                                  7HZNVEXU\mODFNHG DQ\ FUHGLELOLW\ ZKDWVRHYHUl  :H
     IDOVH WHVWLPRQ\ DJDLQVW %\UG DQG KLV FRGHIHQGDQWV DQG  $
     VXEVWDQWLYH FODLP RI DFWXDO LQQRFHQFH RI WKH GHDWK SHQDOW\ XQGHU
                                                                                  DJUHH:LWKUHVSHFWWRWKHVHFRQGUHDVRQZHQRWH
     +HUUDUD Y &ROOLQV  86                                       XQGHU+HUUDUDVXSUDWKDWWKHHYLGHQWLDU\WKUHVKROGIRU
%\UGjV 0HPRUDQGXP LQ 6XSSRUW DW  Q 2Q WKH VXUIDFH LW DSSHDUV WKDW           DFODLPRIDFWXDOLQQRFHQFHLVmH[WUDRUGLQDULO\KLJKl2Q
%\UG LV DWWHPSWLQJ WR XVH KLV DFWXDO LQQRFHQFH FODLP DV D mJDWHZD\                WKH VWDWH RI WKH UHFRUG LQ WKLV FDVH WKH WULDO FRXUW ZDV
WKURXJK ZKLFK D KDEHDV SHWLWLRQ PXVW SDVV WR KDYH KLV RWKHUZLVH EDUUHG            HQWLWOHGWRFRQFOXGHWKDWWKHHYLGHQFHSURYLGHGE\%\UG
FRQVWLWXWLRQDO FODLP FRQVLGHUHG RQ WKH PHULWVl 6FKOXS  86 DW 
 ,Q DFWXDOLW\ KH LV WU\LQJ WR XVH KLV DFWXDO LQQRFHQFH FODLP SURFHGXUDOO\ DV
                                                                                  LQWKHDIILGDYLWVIHOOmIDUVKRUWlRIWKDWZKLFKZRXOGKDYH
WKH ZD\ WR UDLVH EDUUHG FRQVWLWXWLRQDO FODLPV DQG DQ DOVREDUUHG
                                                                                  EHHQQHFHVVDU\WRPDNHRXWDFRJQL]DEOHFRQVWLWXWLRQDO
VXEVWDQWLYH DFWXDO LQQRFHQFH FODLP                                               FODLP
     )XUWKHUPRUH %\UGjV FODLP WKDW KH FRXOG QRW KDYH UDLVHG KLV DFWXDO
LQQRFHQFH FODLP LQ WKH VWDWH FRXUW EHFDXVH 2KLR GLG QRW DW WKH WLPH             o1(GDWo:/DW
IRRWQRWHRPLWWHG
UHFRJQL]H DFWXDO LQQRFHQFH RI WKH GHDWK SHQDOW\ DV D FRJQL]DEOH FODLP           7KH2KLR&RXUWRI$SSHDOVDOVRDJUHHGZLWKWKHWULDOFRXUWjV
PXVW EH UHMHFWHG EHFDXVH KH PRVW FHUWDLQO\ FRXOG KDYH XVHG LW LQ VXSSRUW
RI KLV GXH SURFHVV FKDOOHQJH WR WKH VXIILFLHQF\ RI WKH HYLGHQFH 6HH 6WDWH
                                                                                FRQFOXVLRQWKDW%\UGjVVHFRQGFODLPFKDOOHQJLQJ$UPVWHDGjV
Y &DPSEHOO  :/  DW 
 1R & 2KLR &W $SS sDQ 
                                                                                FUHGLELOLW\ ZDV EDUUHG E\ UHV MXGLFDWD EHFDXVH LW KDG EHHQ
 SHU FXULDP
       ,QUH%\UG                                          1R        1R                                         ,QUH%\UG      

UDLVHG DW KLV WULDO RQ DSSHDO LQ KLV ILUVW SRVWFRQYLFWLRQ           WR H[FXVH WKH DEXVH DQG SURFHHG ZLWK D VHFRQG KDEHDV
SHWLWLRQDQGLQIHGHUDOKDEHDVFRUSXVSURFHHGLQJV                         SHWLWLRQ
  2Q $XJXVW   WKH 2KLR 6XSUHPH &RXUW GHFOLQHG                    )HGHUDO FRXUWV UHWDLQ WKH DXWKRULW\ WR LVVXH WKH ZULW RI
MXULVGLFWLRQDQGGLVPLVVHGWKHDSSHDOmDVQRWLQYROYLQJDQ\                      KDEHDVFRUSXVLQDIXUWKHUQDUURZFODVVRIFDVHVGHVSLWH
VXEVWDQWLDOFRQVWLWXWLRQDOTXHVWLRQl6WDWHY%\UG&DVH1R                   D SHWLWLRQHUjV IDLOXUH WR VKRZ FDXVH IRU D SURFHGXUDO
$XJXVW                                                     GHIDXOW  7KHVH DUH H[WUDRUGLQDU\ LQVWDQFHV ZKHQ D
                                                                                 FRQVWLWXWLRQDO YLRODWLRQ SUREDEO\ KDV FDXVHG WKH
                                    ,,                                          FRQYLFWLRQ RI RQH LQQRFHQW RI WKH FULPH  :H KDYH
                                                                                 GHVFULEHGWKLVFODVVRIFDVHVDVLPSOLFDWLQJDIXQGDPHQWDO
  8QGHUWKH$('3$DSHWLWLRQHULVUHTXLUHGSULRUWRILOLQJ                     PLVFDUULDJHRIMXVWLFH0XUUD\Y&DUULHUVXSUD
DVHFRQGRUVXFFHVVLYHKDEHDVFRUSXVSHWLWLRQLQWKHGLVWULFW                    86DW6&WDW
FRXUW WR VHHN DXWKRUL]DWLRQ mLQ WKH DSSURSULDWH FRXUW RI
DSSHDOVIRUDQRUGHUDXWKRUL]LQJWKHGLVWULFWFRXUWWRFRQVLGHU                0F&OHVNH\86DWVHHDOVR6FKOXS86DW
WKH DSSOLFDWLRQl   86&  E$  8QGHU WKH             TXRWLQJ0F&OHVNH\$JDLQ%\UGLVQRWH[HPSWHGIURP
$('3$DVHFRQGRUVXFFHVVLYHKDEHDVFRUSXVDSSOLFDWLRQ                        WKH$('3$jVVWDQGDUGVEHFDXVHWKHRXWFRPHRIWKLVFDVHGRHV
XQGHU WKDW ZDVQRWSUHVHQWHGLQDSULRUDSSOLFDWLRQ                   QRWGLIIHUXQGHUWKLVH[FHSWLRQHLWKHU
mVKDOOEHGLVPLVVHGXQOHVVlWKHDSSOLFDQWVKRZVmWKHIDFWXDO
SUHGLFDWHlIRUKLVQHZFODLPRILQQRFHQFHmFRXOGQRWKDYH                         ,QLWLDOO\ ZH QRWH WKDW %\UG LQYRNHV WKH ZURQJ DFWXDO
EHHQ GLVFRYHUHG SUHYLRXVO\ WKURXJK WKH H[HUFLVH RI GXH                  LQQRFHQFH VWDQGDUG  &RQWUDU\ WR KLV DVVHUWLRQ WKH 6FKOXS
                                                                               VWDQGDUGGRHVQRWDSSO\,Q6FKOXSWKH6XSUHPH&RXUWKHOG
                                                                               WKDW IRU D SURFHGXUDO FODLP RI LQQRFHQFH DV RSSRVHG WR D
    
      8QGHU  86&  E& m>W@KH FRXUW RI DSSHDOV PD\
                                                                               VXEVWDQWLYHFRQVWLWXWLRQDOFODLPRILQQRFHQFHDVLQ+HUUDUDY
DXWKRUL]H WKH ILOLQJ RI D VHFRQG RU VXFFHVVLYH DSSOLFDWLRQ RQO\ LI LW          &ROOLQV  86   WR PHHW WKH PLVFDUULDJH RI
GHWHUPLQHV WKDW WKH DSSOLFDWLRQ PDNHV SULPD IDFLH VKRZLQJ WKDW WKH             MXVWLFH H[FHSWLRQ WR H[FXVH DEXVH RI WKH ZULW WKH KDEHDV
DSSOLFDWLRQ VDWLVILHV WKH UHTXLUHPHQWV RI WKLV VXEVHFWLRQl )XUWKHUPRUH       SHWLWLRQHUmPXVWVKRZWKDWLWLVPRUHOLNHO\WKDQQRWWKDWQR
m>W@KH JUDQW RU GHQLDO RI DQ DXWKRUL]DWLRQ E\ D FRXUW RI DSSHDOV WR ILOH D     UHDVRQDEOHMXURUZRXOGKDYHFRQYLFWHGKLPLQOLJKWRIWKHQHZ
VHFRQG RU VXFFHVVLYH DSSOLFDWLRQ VKDOO QRW EH DSSHDODEOH DQG VKDOO QRW EH
WKH VXEMHFW RI D SHWLWLRQ IRU UHKHDULQJ RU IRU D ZULW RI FHUWLRUDULl 
                                                                               HYLGHQFHl6FKOXS86DW+RZHYHUWKH6FKOXS
86&  E( $00 DOVR ,Q UH .LQJ  )G  WK &LU
 HQ EDQF KROGLQJ WKDW GHQLDO RI SHUPLVVLRQ WR ILOH D VHFRQG RU
VXFFHVVLYH KDEHDV SHWLWLRQ XQGHU $('3$ LV QRW VXEMHFW WR HQ EDQF
                                                                                   
UHYLHZ $OWKRXJK %\UGjV LQLWLDO IHGHUDO KDEHDV SHWLWLRQ SUHGDWHG WKH                %\UG LQGLFDWHV WKDW KH VHHNV WR UDLVH LQ KLV VHFRQG RU VXFFHVVLYH
HIIHFWLYH GDWH RI WKH $('3$ WKLV DWWHPSW DW ILOLQJ D VHFRQG KDEHDV            SHWLWLRQ WKH IROORZLQJ FODLPV
SHWLWLRQ LV FOHDUO\ JRYHUQHG E\ WKH $('3$ &I 6ODFN Y 0F'DQLHO                 $0DVVLDK    FODLP LQYROYLQJ WKH VWDWHjV XVH RI LQIRUPDQW 9LUJLO
86   KROGLQJ WKDW DQ DSSHDO IURP WKH GLVPLVVDO RI D KDEHDV              sRUGDQ WR HOLFLW VWDWHPHQWV IURP %\UG LQ YLRODWLRQ RI KLV 6L[WK
FRUSXV SHWLWLRQ DIWHU WKH HIIHFWLYH GDWH RI WKH $('3$ LV JRYHUQHG E\                $PHQGPHQW ULJKW WR FRXQVHO  $ FODLP WKDW SURVHFXWRUV
$('3$ UHJDUGOHVV RI ZKHWKHU WKH KDEHDV SHWLWLRQ ZDV ILOHG LQ WKH GLVWULFW          SUHVHQWHG WHVWLPRQ\ WKH\ NQHZ ZDV IDOVH ZKHQ WKH\ KDG WZR
FRXUW EHIRUH RU DIWHU $('3$jV HIIHFWLYH GDWH 6HH DOVR 6WHZDUG Y                  ZLWQHVVHV LGHQWLI\ D NQLIH DV WKH ZHDSRQ XVHG LQ WKH 87RWHP
0DUWLQH]9LOODUHDO  86    QRWLQJ WKDW KDG WKH                   UREEHU\ HYHQ DIWHU WKH FULPH ODE FRQFOXGHG WKDW WKH NQLIH ZDV QRW
SULVRQHUjV FXUUHQW UHTXHVW IRU UHOLHI EHHQ D VHFRQG DSSOLFDWLRQ LW mSODLQO\        WKH RQH XVHG LQ WKDW UREEHU\  $ FODLP WKDW WULDO FRXQVHO ZHUH
VKRXOG KDYH EHHQ GLVPLVVHGl XQGHU  E RI WKH $('3$ HYHQ                      LQHIIHFWLYH IRU IDLOLQJ WR LQYHVWLJDWH DQG SUHVHQW WHVWLPRQ\ IURP
WKRXJK KLV LQLWLDO IHGHUDO KDEHDV SHWLWLRQ ZDV ILOHG LQ  SULRU WR WKH          DYDLODEOH :RUNKRXVH LQPDWHV ZKR FRXOG KDYH UHYHDOHG WKH
HQDFWPHQW RI WKH $('3$                                                            VFKHPH FRQFRFWHG E\ 5RQDOG $UPVWHDG DQG 9LUJLO sRUGDQ WR JLYH
       ,QUH%\UG                                       1R        1R                                          ,QUH%\UG        

ZHJUDQWHGDVWD\RIH[HFXWLRQIROORZLQJWKHGLVWULFWFRXUWjV                GLOLJHQFHl RU WKDW WKH FODLP mUHOLHV RQ D QHZ UXOH RI
LQLWLDOGHQLDOLQRI%\UGjVILUVWKDEHDVSHWLWLRQ                      FRQVWLWXWLRQDO ODZ PDGH UHWURDFWLYH WR FDVHV RQ FROODWHUDO
                                                                             UHYLHZ E\ WKH 6XSUHPH &RXUW WKDW ZDV          SUHYLRXVO\
  >D@PRQJRWKHUWKLQJVRXURUGHUJUDQWHG3HWLWLRQHUm                    XQDYDLODEOHl86&$	%
  GD\VWRDOORZIRUIXUWKHULQYHVWLJDWLRQDQGGLVFRYHU\RI
  SRVVLEOHKDEHDVFODLPVlLGDW>&ROOLQVY%\UG                     %\UGGRHVQRWUHO\RQDQHZUXOHRIFRQVWLWXWLRQDOODZDQG
  866FDOLDsGLVVHQWLQJIURPGHQLDO                   KH RSHQO\ DGPLWV WKDW KH FDQQRW HVWDEOLVK WKDW WKH IDFWXDO
  RIWKHDSSOLFDWLRQWRYDFDWHVWD\ RI H[HFXWLRQ@DV                SUHGLFDWHIRUKLVQHZFODLPLVQHZO\GLVFRYHUHG6HH%\UGjV
  ZHOODVmOHDYHWRDPHQGWKHSHWLWLRQZLWKLQVL[W\               0HPRUDQGXPLQ6XSSRUWDWmsRKQ%\UGKDVQRWFODLPHG
  GD\V RI WKLV RUGHU WR LQFOXGH DQ\ QHZO\ GLVFRYHUHG                 DQGFRXOGQRWFODLPWKDWKHKDVQHZO\GLVFRYHUHGHYLGHQFHRI
  FODLPV>@,GDW>@                                               DFWXDOLQQRFHQFHRIWKHGHDWKSHQDOW\DVGHILQHGLQE
                                                                             RI$('3$l(PSKDVLVLQRULJLQDO7KLVLVWKHFDVHEHFDXVH
%\UG)GDWHPSKDVLVDGGHG%\UGVDWRQWKLV                   %\UG GHOLEHUDWHO\ FKRVH QRW WR XVH KLV SURRI RI DFWXDO
HYLGHQFH GHVSLWH WKH H[SOLFLW RSSRUWXQLW\ DQG H[SUHVV                  LQQRFHQFHo%UHZHUjVVWDWHPHQWVoLQVXSSRUWRIKLVLQLWLDO
LQVWUXFWLRQWRUDLVHmDQ\QHZO\GLVFRYHUHGFODLPVl,QOLJKWRI             VWDWHSRVWFRQYLFWLRQSHWLWLRQDQGKHOLNHZLVHFKRVHQRWWR
WKLV SULRU RUGHU %\UGjV GHOLEHUDWH VLOHQFH WKHQ DQG EUD]HQ         FLWH %UHZHUjV DIILGDYLW LQ KLV ILUVW IHGHUDO KDEHDV SHWLWLRQ
DWWHPSWQRZWRDVVHUWWKHFODLPLVQRWKLQJVKRUWRIIUDXGRQ                7KXV DV %\UG FRQFHGHV KH FDQQRW VDWLVI\  EjV
WKLV&RXUW                                                                  UHTXLUHPHQWV
  ,QVKRUW%\UGXWWHUO\IDLOVWRHVWDEOLVKFDXVHWRH[FXVHKLV                 ,QVWHDG KH DUJXHV WKDW XQGHU SUH$('3$ mDEXVH RI WKH
DEXVHRIWKHZULW7KXV%\UGFDQQRWSUHYDLOHYHQXQGHUWKH                ZULWlGHFLVLRQVKDEHDVSHWLWLRQHUVZHUHDOORZHGWRILOHVHFRQG
SUH$('3$FDXVHDQGSUHMXGLFHWHVWH[FXVLQJDQDEXVHRIWKH                  RUVXFFHVVLYHSHWLWLRQVUDLVLQJFODLPVWKDWZHUHRUFRXOGKDYH
ZULW                                                                      EHHQ UDLVHG HDUOLHU ZKHQ WKH SHWLWLRQHU PHW WKH mDFWXDO
                                                                             LQQRFHQFHIXQGDPHQWDOPLVFDUULDJHRIMXVWLFHlH[FHSWLRQDV
                                   %                                        GHILQHGE\WKH6XSUHPH&RXUWLQ0F&OHVNH\Y=DQW86
                                                                             DQG6FKOXSY'HOR86
  (YHQ ZKHUH WKH SHWLWLRQHU LV XQDEOH WR VKRZ FDXVH DQG             %\UG DVVHUWV WKDW WKH SUH$('3$ mDEXVH RI WKH ZULWl
SUHMXGLFHWRH[FXVHWKHDEXVHRIWKHZULWKHPD\\HWEHDEOH                VWDQGDUG UDWKHU WKDQ  E VKRXOG DSSO\ WR KLV FDVH
                                                                             EHFDXVH KLV LQLWLDO KDEHDV SHWLWLRQ ZDV ILOHG SULRU WR WKH
                                                                             HIIHFWLYH GDWH RI WKH $('3$ DQG WKH DSSOLFDWLRQ RI WKH
                                                                             $('3$VWDQGDUGVZRXOGKDYHDQmLPSHUPLVVLEO\UHWURDFWLYH
                                                                            HIIHFWl+HFLWHVRXUGHFLVLRQVLQ,QUH+DQVHUG)G
      %\UG ILOHG KLV IHGHUDO KDEHDV SHWLWLRQ RQ 0DUFK   RQO\ HLJKW
GD\V EHIRUH KLV VFKHGXOHG H[HFXWLRQ %\UG ILOHG D SHWLWLRQ IRU ZULW RI
                                                                             WK&LUDQG,QUH6RQVKLQH)GWK&LU
KDEHDV FRUSXV SXUVXDQW WR  86&   7KH GLVWULFW FRXUW UHMHFWHG      LQVXSSRUWRIKLVDUJXPHQW
%\UGjV KDEHDV SHWLWLRQ RQ JURXQGV RI LQH[FXVDEOH GHOD\ :H JUDQWHG D
VWD\ RI H[HFXWLRQ KRZHYHU 7KH 6WDWH ILOHG DQ DSSOLFDWLRQ WR YDFDWH WKH
VWD\ RI H[HFXWLRQ LQ WKH 8QLWHG 6WDWHV 6XSUHPH &RXUW ZKLFK ZDV GHQLHG
E\ sXVWLFH 6WHYHQV RYHU sXVWLFH 6FDOLDjV GLVVHQW 2XU RUGHU VWD\HG %\UGjV
H[HFXWLRQ IRU m GD\V WR DOORZ IRU IXUWKHU LQYHVWLJDWLRQ DQG GLVFRYHU\
RI SRVVLEOH KDEHDV FODLPVl 6HH &ROOLQV Y %\UG  86  
                                                                                 
6FDOLD s GLVVHQWLQJ VHH DOVR %\UG Y &ROOLQV  )G )G          6HFWLRQ E FRQWDLQV D WKLUG EDVLV IRU SHUPLWWLQJ D VHFRQG RU
WK &LU  FHUW GHQLHG  86                           VXFFHVVLYH SHWLWLRQ WKDW LV QRW UHOHYDQW LQ WKLV FDVH
        ,QUH%\UG                                    1R       1R                                       ,QUH%\UG      

  2XU LQLWLDO LQTXLU\ LV ZKHWKHU SURYLVLRQV RI WKH $('3$           RIILOLQJKLVILUVWDSSOLFDWLRQLQWKHKRSHRIEHLQJJUDQWHG
DSSO\WRWKLVFDVH6HH,QUH*UHHQ)GWK               WZR KHDULQJV UDWKHU WKDQ RQH RU IRU VRPH RWKHU VXFK
&LUSHUFXULDP                                                 UHDVRQKHPD\EHGHHPHGWRKDYHZDLYHGKLVULJKWWRD
                                                                           KHDULQJRQDVHFRQGDSSOLFDWLRQSUHVHQWLQJWKHZLWKKHOG
    :KHQDFDVHLPSOLFDWHVDIHGHUDOVWDWXWHHQDFWHGDIWHUWKH             JURXQG1RWKLQJLQWKHWUDGLWLRQVRIKDEHDVFRUSXV
    HYHQWVLQVXLWDQG&RQJUHVVKDVQRWH[SUHVVO\SUHVFULEHG              UHTXLUHVWKHIHGHUDOFRXUWVWRWROHUDWHQHHGOHVVSLHFHPHDO
    WKH VWDWXWHjV SURSHU UHDFK WKH FRXUW PXVW GHWHUPLQH            OLWLJDWLRQ RU WR HQWHUWDLQ FROODWHUDO SURFHHGLQJV ZKRVH
    ZKHWKHUWKHQHZVWDWXWHZRXOGKDYHDUHWURDFWLYHHIIHFW               RQO\SXUSRVHLVWRYH[KDUDVVRUGHOD\
    LH ZKHWKHU LW ZRXOG LPSDLU ULJKWV D SDUW\ SRVVHVVHG
    ZKHQ KH DFWHG LQFUHDVH D SDUW\jV OLDELOLW\ IRU SDVW         6DQGHUVY8QLWHG6WDWHV86FRQVWUXLQJ
    FRQGXFW RU LPSRVH QHZ GXWLHV ZLWK UHVSHFW WR                  YHUVLRQ RI  KROGLQJ WKDW QHZFODLP VXFFHVVLYH
    WUDQVDFWLRQVDOUHDG\FRPSOHWHG/DQGJUDIY86,)LOP                SHWLWLRQVZHUHEDUUHGmRQO\LIWKHUHKDGEHHQVRPHDEXVHRI
    3URGV86                         WKH ZULWl ZKLFK WKH &RXUW GHVFULEHG DV DERYH  6HH DOVR
                                                                         8QLWHG 6WDWHV Y 0DF'RQDOG  )G   WK &LU
,GDW,Q+DQVHUGZHGHWHUPLQHGWKDW&RQJUHVVKDVQRW             KROGLQJ WKDW GHIHQVH FRXQVHOjV VWUDWHJLF GHFLVLRQ WR
H[SUHVVHGDQ\FOHDULQWHQWDVWRWKHVWDWXWHjVSURSHUUHDFK            ZLWKKROGFHUWDLQHYLGHQFHGLGQRWDPRXQWWRFDXVHVWDWLQJ
6HH+DQVHUG)GDW:HPXVWWKHUHIRUHGHWHUPLQH               WKDWm>V@XFKGHOLEHUDWHE\SDVVFOHDUO\FDQQRWVXUYLYHDEXVHRI
ZKHWKHU WKH SURYLVLRQV RI WKH $('3$ DSSO\ WR WKLV FDVH         WKH ZULW DQDO\VLV RQ D VHFRQG KDEHDV DSSHDOl FLWLQJ
UHVRUWLQJ WR /DQGJUDIjV GHIDXOW UXOHV WR GHFLGH ZKHWKHU           0F&OHVNH\*XQQY1HZVRPH)GWK&LU
$('3$PD\EHDSSOLHGKHUH6HHLG                                    m,IWKHSHWLWLRQHUNQRZLQJO\DQGGHOLEHUDWHO\ZLWKKHOG
                                                                         WKHFODLPIURPDSULRUSHWLWLRQWKHQKHKDVDEXVHGWKHZULWl
   ,Q+DQVHUGWKHSHWLWLRQHUZKRSOHDGHGJXLOW\WRXVLQJD             )XUWKHUPRUHDVWKH6XSUHPH&RXUWjVGLVFXVVLRQLQ0F&OHVNH\
ILUHDUPLQDGUXJWUDIILFNLQJRIIHQVHLQYLRODWLRQRI86&         RIWKHKLVWRU\RIWKHDEXVHRIWKHZULWGRFWULQHPDNHVFOHDU
FILOHGKLVLQLWLDOLQDUJXLQJWKDWKLVGUXJ        %\UGjVGHOLEHUDWHDEDQGRQPHQWRIKLVDFWXDOLQQRFHQFHFODLP
FRQYLFWLRQYLRODWHGWKH'RXEOHsHRSDUG\&ODXVH7KHGLVWULFW            DOWKRXJKQRWWKHRQO\H[DPSOHRIFRQGXFWWKDWGLVHQWLWOHGD
FRXUW GHQLHG WKH PRWLRQ LQ sXO\  DQG ZH DIILUPHG RQ       SHWLWLRQHUWRUHOLHILVWKHFODVVLFRQH6HH0F&OHVNH\
DSSHDO6HH+DQVHUGY8QLWHG6WDWHV)G:/              86 DW  GLVFXVVLQJ WKH RULJLQV DQG PHDQLQJ RI WKH
 WK &LU sXQH    :KLOH WKDW DSSHDO ZDV        DEXVHRIWKHZULWGRFWULQH
SHQGLQJWKH6XSUHPH&RXUWDQQRXQFHGLWVGHFLVLRQLQ%DLOH\
Y8QLWHG6WDWHV86RQ'HFHPEHU                %\UGDFNQRZOHGJHVWKDWKHKDGLQKLVSRVVHVVLRQVLQFH
%DLOH\KHOGWKDWWKHORZHUFRXUWVLQFOXGLQJRXURZQKDGEHHQ           WKHDIILGDYLWRIFRGHIHQGDQW%UHZHUZKLFKKHFRXOGKDYH
VXVWDLQLQJFRQYLFWLRQVXQGHUFIRULQQRFHQWEHKDYLRU             XVHGLQVXSSRUWRIKLVHDUOLHUFODLPWKDW$UPVWHDGjVWHVWLPRQ\
2Q1RYHPEHUDIWHUWKHHIIHFWLYHGDWHRIWKH$('3$              ZDV SHUMXUHG  +H KDV VDW RQ WKLV HYLGHQFH OLNH D FKLFNHQ
+DQVHUGILOHGDPRWLRQZLWKWKLVFRXUWVHHNLQJOHDYHWRILOHD           ZDLWLQJIRUDQHJJWRKDWFKIRUWZHOYH\HDUVGHVSLWHUHSHDWHG
VHFRQGRUVXFFHVVLYHSHWLWLRQLQWKHGLVWULFWFRXUWEDVHGXSRQ           FRQWDFWZLWKERWKWKHVWDWHDQGIHGHUDOFRXUWV7KHUHLVVLPSO\
WKH LQWHUYHQLQJ %DLOH\ GHFLVLRQ  6SHFLILFDOO\ +DQVHUG            QROHJDOH[FXVHIRUWKLVFRQGXFW
                                                                            :KDWPDNHV%\UGjVDEXVHRIWKHZULWHYHQPRUHRXWUDJHRXV
     
      %\UG OLNHZLVH DFNQRZOHGJHV WKDW WKLV TXHVWLRQ PXVW EH GHFLGHG E\
                                                                         LV WKH IDFW WKLV &RXUW DFWXDOO\ JDYH KLP WKH RSSRUWXQLW\ o
                                      6HH +DQVHUG
WKLV &RXUW DQG QRW WKH GLVWULFW FRXUW               )G DW    LQGHHGGLUHFWLYHoWRUDLVHKLVDFWXDOLQQRFHQFHFODLP:KHQ
6RQVKLQH   )G DW 
     ,QUH%\UG                                     1R    1R                                         ,QUH%\UG        

UHVXUUHFWHGXQWLOsDQXDU\QHDUO\WZHOYH\HDUVODWHUDIWHU      FODLPHGWKDWXQGHU%DLOH\KHZDVVHUYLQJWLPHIRUFRQGXFW
%\UGDGPLWWHGO\EHFDPHDZDUHRILW7KXVXQOLNHWKHPRYDQW         WKDWZDVQHYHUDFULPH+DQVHUG)GDW
LQ +DQVHUG %\UG FRXOG KDYH UDLVHG KLV DFWXDO LQQRFHQFH
FODLPLQKLVILUVWSUH$('3$IHGHUDOKDEHDVSHWLWLRQ$QG             7KXV WKH LVVXH SUHVHQWHG LQ +DQVHUG ZDV mZKHWKHU
%\UG DFWXDOO\ NQHZ WKLV  ,Q DQ m$SSOLFDWLRQ IRU 6WD\ RI   $('3$jVQHZUHVWULFWLRQRQILOLQJPXOWLSOHPRWLRQV
3URFHHGLQJV WR $OORZ ,QYHVWLJDWLRQ DQG 'LVFRYHU\ RI            µLV WKH W\SH RI SURYLVLRQ WKDW VKRXOG JRYHUQ FDVHV DULVLQJ
3RWHQWLDO&ODLPVDQG)RU/HDYHWR$PHQG3HWLWLRQWR&RPSO\           EHIRUHLWVHQDFWPHQWjl,GTXRWLQJ/DQGJUDI86DW
:LWK 0F&OHVN\ Y =DQW  6&W  l ILOHG RQ       1RWLQJ WKDW &RQJUHVV KDG QRW H[SUHVVHG DQ\ FOHDU
0DUFKKHVWDWHG                                            DQVZHU WR WKH TXHVWLRQ WKH +DQVHUG FRXUW ORRNHG WR
                                                                     /DQGJUDIjV GHIDXOW UXOHV WR GHFLGH WKH LVVXH  ,G  7KLV
    :KDW>0F&OHVNH\@PHDQVWR3HWLWLRQHU%\UGLVFOHDU              LQYROYHGILUVWGHWHUPLQLQJZKHWKHUWKHQHZOHJLVODWLRQPDNHV
  +H ZLOO KDYH RQH FKDQFH WR EULQJ KLV KDEHDV FODLPV        DQ\FKDQJHVWRWKHFRQWUROOLQJODZDQGVHFRQGZKHWKHULQ
  EHIRUHWKHIHGHUDOFRXUW+H DQGKLVFRXQVHOKDYHWKH            OLJKW RI DQ\ FKDQJH DSSO\LQJ WKH UHOHYDQW QHZ ODZ ZRXOG
  REOLJDWLRQWRSXUVXHDOOSRWHQWLDOFRQVWLWXWLRQDOFODLPVIRU       DWWDFKQHZOHJDOFRQVHTXHQFHVWRFRQGXFWSUHGDWLQJWKH$FWjV
  ZKLFKmUHDVRQDEOHLQYHVWLJDWLRQlPD\UHYHDOSUHYLRXVO\             SDVVDJHVXFKWKDWDSSO\LQJLWZRXOGKDYHDQLPSHUPLVVLEOH
  XQNQRZQIDFWXDOVXSSRUW                                           UHWURDFWLYHHIIHFW,GDWFLWLQJ/DQGJUDI
)RU WKLV UHDVRQ +DQVHUG DQG SURJHQ\ DUH LQDSSOLFDEOH          7KH +DQVHUG FRXUW QRWHG WKDW XQGHU SUH$('3$
)XUWKHUPRUHIRUWKHUHDVRQVZHDGGUHVVQH[WSUH$('3$              MXULVSUXGHQFHDIHGHUDOSULVRQHUZKRZLVKHGWRILOHDVHFRQG
ODZ ZRXOG QRW KDYH HQWLWOHG %\UG WR UDLVH WKH QHZ KDEHDV   RUVXEVHTXHQW  PRWLRQZDVUHTXLUHGWRSURYHLQWKH
FODLPVLQDQ\HYHQW7KXVWKHDSSOLFDWLRQRISUH$('3$ODZ         GLVWULFWFRXUWHLWKHUWKDWWKHPRWLRQGLGQRWFRQVWLWXWHmDEXVH
ZRXOGQRWEHmDGLIIHUHQFHWKDWPDWWHUVlHQWLWOLQJ%\UGWRSUH      RI WKH ZULWl RU WKDW KH KDG PDGH D mFRORUDEOH VKRZLQJ RI
$('3$VWDQGDUGVXQGHUD/DQGJUDIDQDO\VLV                         IDFWXDO LQQRFHQFHl DV UHTXLUHG E\ 0F&OHVNH\  ,G DW 
                                                                     7KH FRXUW GHWHUPLQHG WKDW +DQVHUG VDWLVILHG ERWK RI WKHVH
                                ,,,                                 FULWHULDEHFDXVHKHFRXOGVKRZERWKmFDXVHlDQGmSUHMXGLFHl
                                                                     IRUIDLOLQJWRUDLVHWKH%DLOH\LVVXHLQWKHILUVWPRWLRQ7KH
                                 $                                  FRXUW IRXQG WKDW +DQVHUG KDG GHPRQVWUDWHG FDXVH IRU KLV
                                                                     IDLOXUH WR UDLVH WKH LVVXH LQ KLV ILUVW PRWLRQ EHFDXVH DW WKH
   (YHQ LI SUH$('3$ ODZ DSSOLHG WR %\UGjV FDVH %\UGjV      WLPH WKLV &RXUW KDG VXSSRUWHG D EURDG GHILQLWLRQ RI mXVHl
FODLP IDLOV  )LUVW DQG IRUHPRVW %\UGjV FDVH LV WKH       XQGHUWKHVWDWXWHDQGKDGVSHFLILFDOO\UHMHFWHGWKHFODLPLQKLV
TXLQWHVVHQWLDODEXVHRIWKHZULWDV%\UGUHDGLO\FRQFHGHV       GLUHFW DSSHDO  ,G DW   +DQVHUG DOVR PDGH D VXIILFLHQW
KHGHOLEHUDWHO\ZLWKKHOGKLVDFWXDOLQQRFHQFHFODLPIURPKLV         VKRZLQJRIERWKSUHMXGLFHDQGDFWXDOLQQRFHQFHEHFDXVHmLW
ILUVWIHGHUDOKDEHDVSHWLWLRQ                                       DSSHDU>HG@ IURP WKH UHFRUG WKDW KH SOHDGHG JXLOW\ DQG ZDV
                                                                     FRQYLFWHGIRUFRQGXFWWKDWLVXQGHU%DLOH\QRWFULPLQDOl,G
  7KXVIRUH[DPSOHLIDSULVRQHUGHOLEHUDWHO\ZLWKKROGV            7KH+DQVHUGFRXUWWKHUHIRUHFRQFOXGHGWKDWmXQGHUWKHROG
  RQHRIWZRJURXQGVIRUIHGHUDOFROODWHUDOUHOLHIDWWKHWLPH       DEXVHRIWKHZULWVWDQGDUG+DQVHUGZRXOGEHHQWLWOHGWRUDLVH
                                                                     KLV%DLOH\FODLPLQDPRWLRQl,G

     SUHVHQWLQJ LQ D SRVWFRQYLFWLRQ SHWLWLRQ KLV FODLP RI mDFWXDO
                                                                        1H[W WKH +DQVHUG FRXUW GHWHUPLQHG WKDW WKH $('3$
     LQQRFHQFHl                                                     VWDQGDUGZRXOGQRWDOORZVXFKDPRWLRQ7KHFRXUW
%\UG   :/  DW 
                                        QRWHGWKDWXQGHUWKHQHZODZDSULVRQHUPD\ILOHDVHFRQG
    ,QUH%\UG                                     1R       1R                                              ,QUH%\UG       

  PRWLRQ RQO\ LI WKH FRXUW RI DSSHDOV UXOHV WKDW WKH   UHVXOWLQWKHLQFDUFHUDWLRQRILQQRFHQWSHUVRQVl6DZ\HU
PRWLRQFRQWDLQVQHZO\GLVFRYHUHGHYLGHQFHRULVEDVHGRQD             86m:HKDYHSUHYLRXVO\KHOGWKDWHYHQ
QHZUXOHRIFRQVWLWXWLRQDOODZ7KH+DQVHUGFRXUWREVHUYHG            LI D VWDWH SULVRQHU FDQQRW PHHW WKH FDXVH DQG SUHMXGLFH
WKDW LQ WKH FDVH VXE MXGLFH WKHUH ZDV QR QHZO\ GLVFRYHUHG    VWDQGDUGDIHGHUDOFRXUWPD\KHDUWKHPHULWVRIWKHVXFFHVVLYH
HYLGHQFHDQGWKDW%DLOH\PHUHO\GHFLGHGWKHSURSHUPHDQLQJ            FODLPV LI WKH IDLOXUH WR KHDU WKH FODLPV ZRXOG FRQVWLWXWH D
RImXVHlXQGHUFDQGGLGQRWDQQRXQFHDQHZUXOHRI             mPLVFDUULDJH RI MXVWLFHl  ,Q D WULR RI  GHFLVLRQV
FRQVWLWXWLRQDOODZ,GDW8QGHUWKH$('3$VWDQGDUG            >.XKOPDQQ Y :LOVRQ  86   0XUUD\ Y
+DQVHUGjVUHTXHVWWRILOHWKHPRWLRQZRXOGEHGHQLHG           &DUULHU86DQG6PLWKY0XUUD\86
,G7KXVDSSO\LQJWKHQHZVWDWXWHZRXOGDWWDFKDVHYHUHQHZ          @ZHHODERUDWHGRQWKHPLVFDUULDJHRIMXVWLFH
OHJDOFRQVHTXHQFHWRKLVILOLQJDILUVWPRWLRQ+DQVHUGZRXOG          RU mDFWXDO LQQRFHQFHl H[FHSWLRQ  $V ZH H[SODLQHG LQ
KDYHORVWWKHULJKWWRFKDOOHQJHKLVVHQWHQFH,GDW7KH       .XKOPDQQWKHH[FHSWLRQGHYHORSHGIURPWKHODQJXDJHRIWKH
+DQVHUG FRXUW WKHUHIRUH KHOG WKDW +DQVHUG GLG QRW QHHG         IHGHUDO KDEHDV VWDWXWH ZKLFK SULRU WR  DOORZHG
SHUPLVVLRQWRILOHDVHFRQGPRWLRQWRFKDOOHQJHKLVF           VXFFHVVLYHFODLPVWREHGHQLHGZLWKRXWDKHDULQJLIWKHMXGJH
FRQYLFWLRQVXQGHU86&LQWKHGLVWULFWFRXUW              ZHUHmVDWLVILHGWKDWWKHHQGVRIMXVWLFHZLOOQRWEHVHUYHGE\
                                                                       VXFKLQTXLU\l
   5HO\LQJRQ+DQVHUGWKHPRYDQWLQ6RQVKLQHDUJXHGWKDWKH
VKRXOGEHDOORZHGWRILOHDVHFRQGPRWLRQWRYDFDWHWRUDLVH              ,QVKRUW%\UGZDVRQQRWLFHDVHDUO\DVWKHILOLQJRIKLV
LQHIIHFWLYH DVVLVWDQFH RI WULDO DQG DSSHOODWH FRXQVHO GXH WR   ILUVWIHGHUDOKDEHDVSHWLWLRQLQWKDWKLVDFWXDOLQQRFHQFH
WKHLUIDLOXUHWRDGYLVH6RQVKLQHRUWKHGLVWULFWFRXUWWKDWWKH        FODLP ZKLFK KH KDG DGPLWWHGO\ NQRZQ DERXW VLQFH 
FRXUW ZDV UHTXLUHG WR LPSRVH KLV VHQWHQFHV RQ WZR FRXQWV      FRXOG KDYH EHHQ UDLVHG DQG ZRXOG KDYH H[FXVHG WKH
FRQFXUUHQWO\ ZLWK KLV XQGLVFKDUJHG SULVRQ WHUP  6RQVKLQH       SURFHGXUDO GHIDXOW RI IDLOLQJ WR UDLVH LW LQ WKH VWDWH FRXUWV
UHOLHGXSRQWKHIROORZLQJSDVVDJHLQ+DQVHUGm:HWKHUHIRUH           ,QVWHDG%\UGjVDFWXDOLQQRFHQFHFODLPOD\GRUPDQWWKURXJK
KROGWKDWDIHGHUDOSULVRQHUPXVWVDWLVI\WKHQHZUHTXLUHPHQWV         WKHILOLQJDQGDSSHDORIKLVILUVWIHGHUDOKDEHDVSHWLWLRQDQG
RI86&RQO\ LIKHKDVILOHGDSUHYLRXV             GHQLDORIFHUWLRUDULQRWWRPHQWLRQERWKWKHVWDWHDSSHOODWH
PRWLRQ RQ RU DIWHU $SULO   WKH GDWH $('3$ ZDV        SURFHVV DQG SRVWFRQYLFWLRQ SURFHHGLQJV DQG ZDV QRW
VLJQHGLQWRODZ$V+DQVHUGjVSUHYLRXVPRWLRQZDV
ILOHG EHIRUH WKDW GDWH KH GRHV QRW QHHG WR PHHW WKLV QHZ
VWDQGDUGWRILOHDVHFRQGPRWLRQl6HH6RQVKLQH)GDW              
                                                                             %\UG DOVR FRXOG KDYH EURXJKW D VXFFHVVLYH SRVWFRQYLFWLRQ SHWLWLRQ
TXRWLQJ+DQVHUG)GDW6RQVKLQHFODLPHG             LQ WKH 2KLR FRXUWV $00 2KLR 5HY &RGH  $ >SUH YHUVLRQ
WKDWWKLVODQJXDJHLQ+DQVHUGPHDQWWKDWKHGLGQRWQHHGWR            RI WKH VWDWXWH@ SURYLGLQJ WKDW mWKH FRXUW PD\ LQ LWV GLVFUHWLRQ DQG IRU
PHHWWKHQHZJDWHNHHSLQJUHTXLUHPHQWVRI$('3$EHFDXVH                JRRG FDXVH VKRZQ HQWHUWDLQ D VHFRQG SHWLWLRQ RU VXFFHVVLYH SHWLWLRQ IRU
                                                                       VLPLODU UHOLHI RQ EHKDOI RI WKH SHWLWLRQHU EDVHG XSRQ WKH VDPH IDFWV 47
OLNH+DQVHUGKLVILUVWPRWLRQZDVILOHGEHIRUH$SULO           QHZO\ GLVFRYHUHG HYLGHQFH (PSKDVLV DGGHG )XUWKHUPRUH XQGHU WKH
+HWKHUHIRUHUHDVRQHGWKDWKHGRHVQRWQHHGWKLV            SULRU YHUVLRQ RI WKH VWDWXWH D SRVWFRQYLFWLRQ SHWLWLRQ FRXOG EH ILOHG mDW DQ\
FRXUWjVDXWKRUL]DWLRQWRILOHDVHFRQGPRWLRQDWWKLV           WLPHl 2KLR 5HY &RGH   6HH DOVR 6WDWH Y %\UG 1R &
WLPH                                                                  o 1(G o   :/  2KLR &W $SS $XJ   SHU
                                                                       FXULDP
  7KH6RQVKLQHFRXUWUHMHFWHGWKLVUHDGLQJRI+DQVHUG                      $V WKH 2KLR &RXUW RI $SSHDOV QRWHG LQ LWV GHQLDO RI %\UGjV DSSHDO RI
                                                                       WKH VWDWH WULDO FRXUWjV GHQLDO RI KLV VXFFHVVLYH SRVWFRQYLFWLRQ SHWLWLRQ
                                                                            >%\UGjV@ DWWRUQH\V DFNQRZOHGJH WKDW VLQFH  WKH\ KDYH EHHQ
    7DNHQRXWRIFRQWH[WLQWKLVZD\WKHTXRWHGSRUWLRQRI                 LQ SRVVHVVLRQ RI DQ DIILGDYLW IURP FRGHIHQGDQW sRKQ %UHZHU
  WKH +DQVHUG GHFLVLRQ ZRXOG VHHP DW ILUVW JODQFH WR                VWDWLQJ WKDW KH DQG QRW %\UG IDWDOO\ VWDEEHG 7HZNVEXU\ 7KXV
  VXSSRUW6RQVKLQHjVSRVLWLRQ6HHDOVR+DQVHUG)G                  %\UG FDQQRW VKRZ WKDW KH ZDV mXQDYRLGDEO\l SUHYHQWHG IURP
    ,QUH%\UG                                   1R      1R                                    ,QUH%\UG     

  7KH +DQVHUG H[FHSWLRQ DV FODULILHG E\ 6RQVKLQH DQG         DW  m2XU KROGLQJ PHDQV WKDW IHGHUDO LQPDWHV ZLOO
*UHHQGRHVQRWDSSO\KHUH6RQVKLQHPDNHVFOHDUWKDWWKH           KDYHRQHSRVW$('3$ELWHDWWKHDSSOHOLPLWHGIXUWKHU
$('3$ JDWHNHHSLQJ SURYLVLRQV RI  E FDQQRW EH        IRUSULVRQHUVZKRILOHGDPRWLRQEHIRUH$('3$jV
DYRLGHGVLPSO\EHFDXVHWKHLQLWLDOKDEHDVSHWLWLRQZDVILOHG         HQDFWPHQW E\ WKH ROG DEXVHRIWKHZULW VWDQGDUGl
SUH$('3$  )XUWKHUPRUH LW LV DSSDUHQW IURP +DQVHUG         6RQVKLQHLVQRZUHTXHVWLQJKLVmRQHSRVW$('3$ELWHDW
6RQVKLQH DQG *UHHQ WKDW WKH H[FHSWLRQ DSSOLHV ZKHUH WKH     WKHDSSOHl+RZHYHUZKHQUHDGLQWKHFRQWH[WRIWKH
SHWLWLRQHUZDVXQDEOHEHFDXVHRIWKHWKHQFXUUHQWVWDWHRIWKH       HQWLUHGHFLVLRQLWLVFOHDUWKDWKLVFDVHLVQRWVXSSRUWHGE\
ODZWRUDLVHDFODLPLQKLVILUVWIHGHUDOSHWLWLRQ,Q+DQVHUG     +DQVHUG
WKHPRYDQWjVUHTXHVWZDVEDVHGRQDQLQWHUYHQLQJ6XSUHPH
&RXUW GHFLVLRQ WKDW JDYH WKH PRYDQW DQ DUJXPHQW WKDW KH       7KH VSHFLILF SUREOHP ZH DGGUHVVHG LQ +DQVHUG ZDV
FRXOGQRWKDYHSUHYLRXVO\UDLVHGLQKLVLQLWLDOKDEHDVSHWLWLRQ     ZKHWKHUDOHJLWLPDWHFODLPEURXJKWSXUVXDQWWR%DLOH\Y
7KXVWKHPRYDQWLQ+DQVHUGKDGFDXVHWRH[FXVHKLVDEXVH            8QLWHG6WDWHV86FRXOGEHEURXJKW
RIWKHZULW+HDOVRREYLRXVO\HVWDEOLVKHGSUHMXGLFHVLQFHWKH     EHIRUHWKHIHGHUDOFRXUWVZKHQWKHPRYDQWKDGDOUHDG\
%DLOH\GHFLVLRQPDGHLWFOHDUWKDW+DQVHUGKDGEHHQFRQYLFWHG        SUHVHQWHG D SUH$('3$ SUH%DLOH\ PRWLRQ WR YDFDWH
IRULQQRFHQWEHKDYLRU7KHPRYDQWVLQ6RQVKLQHDQG*UHHQ            XQGHUDQGZRXOGWKXVEHEDUUHGIURPEULQJLQJ
FRXOGQRWHVWDEOLVKFDXVHEHFDXVHWKHQHZFODLPVWKH\VRXJKW         DQRWKHUPRWLRQE\WKHJDWHNHHSLQJUHTXLUHPHQWV
WRUDLVHZHUHQRWQHZRUQRYHO                                    VHWXSE\&RQJUHVVLQ$('3$:KLOH%DLOH\LWVHOIZDV
                                                                     PHUHO\DGHFLVLRQRIVWDWXWRU\LQWHUSUHWDWLRQPDNLQJLW
  8QOLNH WKH SULVRQHU LQ +DQVHUG %\UG ZDV RQ QRWLFH        LQHOLJLEOH WR VXSSRUW D VHFRQG   PRWLRQ XQGHU
FHUWDLQO\DVHDUO\DVKLVILUVWIHGHUDOKDEHDVSHWLWLRQWKDWKH     $('3$LWUDLVHGFRQFHUQVRIFRQVWLWXWLRQDOGLPHQVLRQ
FRXOG DYDLO KLPVHOI RI WKH DFWXDO LQQRFHQFHIXQGDPHQWDO        DVQXPHURXVLQPDWHVZHUHVHUYLQJPDQGDWRU\SULVRQWLPH
PLVFDUULDJH RI MXVWLFH H[FHSWLRQ WR H[FXVH DQ\ SURFHGXUDO     IRURIIHQVHRIZKLFKWKH\ZHUHDFWXDOO\LQQRFHQW6HH
GHIDXOW  6HH &ROHPDQ Y 7KRPSVRQ  86          7ULHVWPDQ Y 8QLWHG 6WDWHV  )G   G
DFFRUG6DZ\HUY:KLWOH\86          &LU+DQVHUG)GDW
'XJJHU Y $GDPV  86   Q  6PLWK Y
0XUUD\860XUUD\Y&DUULHU             :HWKHUHIRUHDQDO\]HGWKHHIIHFWWKDW$('3$KDGRQ
86(QJOHY,VDDF86           D FODLP VXFK DV WKDW UDLVHG E\ +DQVHUG ZKLFK ZRXOG
:DLQZULJKWY6\NHV86VHHDOVR        KDYH VXUYLYHG WKH ROG mDEXVHRIWKHZULWl WHVW VHH
0F&OHVNH\Y=DQW86)XUWKHUPRUH           0F&OHVNH\Y=DQW86
%\UG DOVR KDG WR KDYH NQRZQ WKDW DFWXDO                       XQGHUWKH6XSUHPH&RXUWjVGHFLVLRQLQ/DQGJUDIY86,
LQQRFHQFHPLVFDUULDJHRIMXVWLFHlH[FHSWLRQH[WHQGVWRDEXVH         )LOP3URGV86:HFRQFOXGHGWKDW
RIWKHZULW6HH+HUUDUDY&ROOLQV86       $('3$GRHVQRWDSSO\WRDPRYDQWVHHNLQJWRUDLVHD
m,QDVHULHVRIFDVHVFXOPLQDWLQJZLWK6DZ\HUY:KLWOH\       %DLOH\FODLPDIWHUKDYLQJILOHGDSUH$('3$PRWLRQWR
86GHFLGHGODVW7HUPZHKDYHKHOGWKDWD        YDFDWH EHFDXVH DSSO\LQJ $('3$ ZRXOG KDYH D
SHWLWLRQHU RWKHUZLVH VXEMHFW WR GHIHQVHV RI DEXVLYH RU        UHWURDFWLYHHIIHFWRQWKHPRYDQWjVSUH$('3$FRQGXFW
VXFFHVVLYHXVHRIWKHZULWPD\KDYHKLVIHGHUDOFRQVWLWXWLRQDO       LHKHZRXOGEHEDUUHGIURPILOLQJDVHFRQGPRWLRQWR
FODLPFRQVLGHUHGRQWKHPHULWVLIKHPDNHVDSURSHUVKRZLQJ          YDFDWHXQGHU$('3$ZKHUHDVEHIRUHWKH$FWKHZRXOG
RIDFWXDOLQQRFHQFH7KLVUXOHRUIXQGDPHQWDOPLVFDUULDJHRI       KDYHEHHQSHUPLWWHGWRILOHKLVVHFRQGPRWLRQ
MXVWLFHH[FHSWLRQLVJURXQGHGLQWKHmHTXLWDEOHGLVFUHWLRQlRI
KDEHDVFRXUWVWRVHHWKDWIHGHUDOFRQVWLWXWLRQDOHUURUVGRQRW         %HFDXVHWKH+DQVHUGFRXUWjV/DQGJUDIDQDO\VLVZDV
                                                                     EDVHGXSRQWKHUHWURDFWLYHHIIHFWWKDW$('3$KDGRQWKH
    ,QUH%\UG                                     1R      1R                                      ,QUH%\UG      

  PRYDQWjVSDUWLFXODUFODLPWKH+DQVHUGKROGLQJPXVWEH              LWVGLVFUHWLRQIRUDGPLWWLQJHYLGHQFHRIDSULRUFRQYLFWLRQIRU
  VLPLODUO\FLUFXPVFULEHG&RQVHTXHQWO\ZKLOH+DQVHUG               WKH VROH SXUSRVH RI VXSSRUWLQJ D  86&  J
  LV QRW VWULFWO\ OLPLWHG WR FODLPV DULVLQJ XQGHU %DLOH\     FRQYLFWLRQ DIWHU WKH GHIHQGDQW RIIHUHG WR VWLSXODWH WR WKH
  DSDUWIURPWKDWFODVVRIFODLPVWKHUHZLOOEHIHZRWKHU            H[LVWHQFHRIWKHSULRUFRQYLFWLRQ6HH*UHHQ)GDW
  FDVHVmLQZKLFKWKHGLIIHUHQFHPDWWHUVl+DQVHUG              7KH *UHHQ FRXUW KHOG WKDW WKH GHFLVLRQ LQ 2OG &KLHI
  )G DW  Q DQG RQ ZKLFK WKH JDWHNHHSLQJ              DQQRXQFHG D mQHZ UXOHlRI FULPLQDO SURFHGXUH DQG ZDV
  UHTXLUHPHQWVRI$('3$ZLOOWKXVKDYHDQLPSHUPLVVLEO\               VXEMHFWWRWKHUXOHRI7HDJXHY/DQH86
  UHWURDFWLYHHIIHFW                                               KROGLQJWKDWLIDGHFLVLRQDQQRXQFHVDmQHZUXOHlRIFULPLQDO
                                                                      SURFHGXUHLWLVQRWWREHDSSOLHGUHWURDFWLYHO\WRFRQYLFWLRQV
,G DW  HPSKDVLV DGGHG  7KH 6RQVKLQH FRXUW          WKDW KDYH DOUHDG\ EHFRPH ILQDO ZKHQ WKH GHFLVLRQ LV
FRQFOXGHG 6RQVKLQH ZDV QRW HQWLWOHG WR UHOLHI EHFDXVH WKH    DQQRXQFHGVXEMHFWWRFHUWDLQH[FHSWLRQV$VVXFKLWZDVQRW
LVVXHKHVRXJKWWRUDLVHZDVEDVLFDOO\RQHDULVLQJXQGHUWKH          UHWURDFWLYH DQG ZDV WKHUHIRUH LQDSSOLFDEOH RQ FROODWHUDO
6HQWHQFLQJ *XLGHOLQHV ZKLFK ZRXOG EH EDUUHG XQGHU ERWK        UHYLHZ,G
$('3$DQGWKHDEXVHRIWKHZULWVWDQGDUG,G7KHFRXUW
IXUWKHUQRWHGWKDW6RQVKLQHZRXOGQRWKDYHSUHYDLOHGXQGHU              0RUHLPSRUWDQWO\WKH*UHHQFRXUWKHOGWKDWUHJDUGOHVVRI
WKHSUH$('3$ODZEHFDXVHKLVSHWLWLRQZRXOGKDYHEHHQ               ZKHWKHU 2OG &KLHI DQQRXQFHG D QHZ UXOH WKH JDWHNHHSLQJ
GHQLHGDVDQDEXVHRIWKHZULW,G7KXVWKH$('3$jVQHZ           SURYLVLRQVRIDSSOLHGWR*UHHQjVFDVHEHFDXVH*UHHQ
UHVWULFWLRQV GLG QRW DWWDFK QHZ OHJDO FRQVHTXHQFHV IRU         ZRXOG QRW KDYH EHHQ DEOH WR HVWDEOLVK FDXVH WR H[FXVH KLV
6RQVKLQHDQGWKH$('3$KDGQRmLPSHUPLVVLEO\UHWURDFWLYH             IDLOXUH WR DVVHUW WKLV FODLP LQ KLV ILUVW SUH$('3$  
HIIHFWlRQWKHFDVH,G                                           PRWLRQ WR YDFDWH  7KH FRXUW UHDVRQHG  m,I2OG &KLHI ZDV
                                                                      GLFWDWHG E\SUHFHGHQWWKHQKLVFODLPZRXOGQRWKDYHEHHQ
  7KXVLQ6RQVKLQHWKLV&RXUWFDUHIXOO\OLPLWHG+DQVHUG            FRQVLGHUHG µQRYHOj VR DV WR HVWDEOLVK FDXVH KLV IDLOXUH WR
7KH6RQVKLQHFRXUWVWDWHGWKDWWKHUHWURDFWLYLW\GHWHUPLQDWLRQ        DVVHUWWKLVFODLPLQKLVILUVWPRWLRQWRYDFDWHl,GDW
LQ+DQVHUGZDVEDVHGRQWKHSDUWLFXODUIDFWVSUHVHQWHGDQG           7KH*UHHQFRXUWFRQFOXGHG
ZKLOH+DQVHUGLVQRWVWULFWO\OLPLWHGWRFODLPVDULVLQJXQGHU
%DLOH\ mDSDUW IURP WKDW FODVV RI FODLPVl IHZ FDVHV ZLOO      7KXV HYHQ LI 2OG &KLHI GLG QRW DQQRXQFH D QHZ UXOH
TXDOLI\ DV WKRVH mLQ ZKLFK WKH GLIIHUHQFH PDWWHUVl DQG WKH     DSSO\LQJ $('3$ WR WKLV FDVH ZRXOG QRW KDYH D
$('3$ZLOOKDYHDQLPSHUPLVVLEO\UHWURDFWLYHHIIHFW                  UHWURDFWLYHHIIHFWRQSUH$('3$FRQGXFW*UHHQZRXOG
                                                                        KDYH EHHQ EDUUHG IURP DVVHUWLQJ WKLV FODLP LQ D SUH
   ,Q*UHHQZHUHIXVHGWRDSSO\+DQVHUGZKHUHLWZDVFOHDU             $('3$ PRWLRQ WR YDFDWH XQGHU WKH DEXVH RI WKH ZULW
IURPWKHUHFRUGWKDWWKHSULVRQHUFRXOGQRWKDYHMXVWLILHGD            GRFWULQH DV KH ZRXOG QRW KDYH EHHQ DEOH WR HVWDEOLVK
VHFRQG DFWLRQ XQGHU WKH SUH$('3$ FDXVH DQG SUHMXGLFH            FDXVHWRH[FXVHKLVIDLOXUHWRSUHVHQWWKLVFODLPLQKLV
VWDQGDUG7KHPRYDQWLQ*UHHQKDGEHHQFRQYLFWHGRIEHLQJ              ILUVWPRWLRQWRYDFDWHQRUFRXOGKHKDYHRWKHUZLVHPDGH
DIHORQLQSRVVHVVLRQRIDILUHDUPLQYLRODWLRQRI86&            D FRORUDEOH VKRZLQJ RI IDFWXDO LQQRFHQFH  6HH
J*UHHQILOHGKLVILUVWPRWLRQWRYDFDWHXQGHU          0F&OHVNH\Y=DQW86,QUH
RQsXQHZKLFKZDVVXEVHTXHQWO\GHQLHGDVZLWKRXW              +DQVHUG)GDW
PHULW+HILOHGDVHFRQGPRWLRQRQ$XJXVW
ZKLFKWKHGLVWULFWFRXUWGHQLHGDVDQDEXVHRIWKHZULW,QKLV      ,GDW7KHJDWHNHHSLQJSURYLVLRQVLQWKHUHIRUH
WKLUGPRWLRQ*UHHQDUJXHGWKDWWKHUHKDGEHHQDVXEVWDQWLYH          DSSOLHGWR*UHHQjVFDVH,GDW
FKDQJHLQWKHODZEDVHGRQ2OG&KLHIY8QLWHG6WDWHV
862OG&KLHIKHOGWKDWDGLVWULFWFRXUWDEXVHG