Filed: Aug. 07, 2001
Latest Update: Mar. 02, 2020
Summary: 5(&200(1'(' )25 )8//7(;7 38%/,&$7,21 3XUVXDQW WR 6L[WK &LUFXLW 5XOH (/(&7521,& &,7$7,21 )(' $SS 3 WK &LU )LOH 1DPH DS 81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB (,/((1 $ /2*$1 ; 3ODLQWLII$SSHOODQW 1R Y ! '(11 D@FODLPWKDWWKHDGYHUVHHPSOR\PHQW RULQVHQVLWLYHO\6HH0LOHVY*HQHUDO0RWRUV&RUS1R DFWLRQ ZDV DFFRPSOLVKHG YLD FRQVWUXFWLYH GLVFKDUJH LV :/ DW WK&LU0DU
Summary: 5(&200(1'(' )25 )8//7(;7 38%/,&$7,21 3XUVXDQW WR 6L[WK &LUFXLW 5XOH (/(&7521,& &,7$7,21 )(' $SS 3 WK &LU )LOH 1DPH DS 81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB (,/((1 $ /2*$1 ; 3ODLQWLII$SSHOODQW 1R Y ! '(11 D@FODLPWKDWWKHDGYHUVHHPSOR\PHQW RULQVHQVLWLYHO\6HH0LOHVY*HQHUDO0RWRUV&RUS1R DFWLRQ ZDV DFFRPSOLVKHG YLD FRQVWUXFWLYH GLVFKDUJH LV :/ DW WK&LU0DU ..
More
5(&200(1'(' )25 )8//7(;7 38%/,&$7,21
3XUVXDQW WR 6L[WK &LUFXLW 5XOH
(/(&7521,& &,7$7,21 )(' $SS 3 WK &LU
)LOH 1DPH DS
81,7('67$7(6&28572)$33($/6
)257+(6,;7+&,5&8,7
BBBBBBBBBBBBBBBBB
(,/((1 $ /2*$1 ;
3ODLQWLII$SSHOODQW
1R
Y
!
'(11<¶6 ,1&
'HIHQGDQW$SSHOOHH
1
$SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
IRUWKH1RUWKHUQ'LVWULFWRI2KLRDW&OHYHODQG
1R ²'RQDOG&1XJHQW'LVWULFW-XGJH
$UJXHG -DQXDU\
'HFLGHGDQG)LOHG $XJXVW
%HIRUH -21(6%$7&+(/'(5DQG&/$<&LUFXLW
-XGJHV
BBBBBBBBBBBBBBBBB
&2816(/
$5*8(' 'HQQLV 3 =DSND 0$*8,5( 6&+1(,'(5
=$3.$ /(8&+7$* &OHYHODQG 2KLR IRU $SSHOODQW
%ULDQ - .HOO\ )5$17= :$5' &OHYHODQG 2KLR IRU
$SSHOOHH 21 %5,() 'HQQLV 3 =DSND 0$*8,5(
6&+1(,'(5=$3.$ /(8&+7$*&OHYHODQG2KLRIRU
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
$SSHOODQW %ULDQ - .HOO\ .HLWK $ $VKPXV )5$17= (YHQLIWKHPDMRULW\ZHUHFRUUHFW WKDW/RJDQFDUULHGKHU
:$5'&OHYHODQG2KLRIRU$SSHOOHH EXUGHQLQUHVLVWLQJ'HQQ\¶VPRWLRQIRUVXPPDU\MXGJPHQW
WKDWZRXOGQRWZDUUDQWWKHPDMRULW\¶VKDUVKFULWLFLVPRIWKH
&/$< - GHOLYHUHG WKH RSLQLRQ RI WKH FRXUW LQ ZKLFK GLVWULFW FRXUW MXGJH DQG GHIHQGDQW¶V FRXQVHO $W PRVW WKH
-21(6-MRLQHG%$7&+(/'(5- SS GHOLYHUHG GLVWULFW FRXUW¶V MXGJPHQW PLJKW FRQVWLWXWH OHJDO HUURU DQG
DVHSDUDWHGLVVHQWLQJRSLQLRQ 'HQQ\¶VFRXQVHOGLGQRWKLQJPRUHWKDQDJJUHVVLYHO\UHSUHVHQW
'HQQ\¶VZKLFKLVSUHFLVHO\ZKDWSURIHVVLRQDOHWKLFVPDQGDWH
BBBBBBBBBBBBBBBBB WKDW'HQQ\¶VFRXQVHOGRLQRXUDGYHUVDULDOV\VWHP
23,1,21 )RUDOORIWKHVHUHDVRQV,GLVVHQW
BBBBBBBBBBBBBBBBB
&/$<&LUFXLW-XGJH3ODLQWLII(LOHHQ/RJDQIND(LOHHQ
&ODUN DSSHDOV IURP WKH GLVWULFW FRXUW¶V RUGHU JUDQWLQJ
VXPPDU\MXGJPHQWWR'HIHQGDQW'HQQ\¶V,QFRQ3ODLQWLII¶V
UDFHGLVFULPLQDWLRQFODLPEURXJKWXQGHU7LWOH9,,86&
HHWVHT%HFDXVHZHEHOLHYHWKDWWKHGLVWULFWFRXUW
HUUHGLQILQGLQJWKDW3ODLQWLIIIDLOHGWRHVWDEOLVKDSULPDIDFLH
FDVHRIUDFHGLVFULPLQDWLRQDQGHUUHGLQFRQFOXGLQJWKDWQR
JHQXLQH LVVXH RI PDWHULDO IDFW UHPDLQHG DV WR ZKHWKHU
'HIHQGDQW¶VSURIIHUHGUHDVRQIRULWVGLVFLSOLQDU\DFWLRQZDVD
SUHWH[WIRUGLVFULPLQDWLRQZH5(9(56(WKHGLVWULFWFRXUW¶V
RUGHUJUDQWLQJ'HIHQGDQW¶VPRWLRQIRUVXPPDU\MXGJPHQWDQG
5(0$1'WKHFDVHIRUWULDO
%$&.*5281'
3URFHGXUDO+LVWRU\
2Q -XQH 3ODLQWLII (LOHHQ /RJDQ DQ $IULFDQ
$PHULFDQIHPDOHZKRKDGEHHQHPSOR\HGE\'HIHQGDQWDVD
VHUYHUIRUPRUHWKDQWHQ\HDUVILOHGDVHYHQFRXQWFRPSODLQW
LQ WKH GLVWULFW FRXUW DOOHJLQJ DPRQJ RWKHU WKLQJV WKDW
'HIHQGDQWYLRODWHGKHUFLYLOULJKWVXQGHU7LWOH9,,RIWKH&LYLO
5LJKWV$FWRI E\HQJDJLQJLQGLVFULPLQDWRU\WUHDWPHQW
ZKLFKOHGWR3ODLQWLII¶VFRQVWUXFWLYHGLVFKDUJH2Q-XO\
'HIHQGDQWILOHGDQDQVZHULQUHVSRQVHWRFRXQWVRQH
WZRVL[DQGSDUWRIFRXQWVHYHQRI3ODLQWLII¶VFRPSODLQW DQG
ILOHGDPRWLRQWRGLVPLVVDVWRFRXQWVWKUHHIRXUILYHDQGSDUW
RIFRXQWVHYHQRIWKHFRPSODLQW7KHGLVWULFWFRXUWWKHUHDIWHU
JUDQWHG'HIHQGDQW¶VPRWLRQWRGLVPLVVWKHVHFRXQWVZKLFK
LQFOXGHG³3ODLQWLII¶VFODLPVRIGLVFULPLQDWLRQLQYLRODWLRQRI
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
GLVWULFW FRXUW¶V JUDQW RI VXPPDU\ MXGJPHQW WR 'HQQ\¶V 2+,2 5(9 &2'( EDUUHG E\ SHULRG RI OLPLWDWLRQ
+RZHYHU , ZRXOG DOVR KROG WKDW /RJDQ ZKROO\ IDLOHG WR WRUWLRXVLQWHUIHUHQFHZLWKDQHPSOR\PHQWFRQWUDFWQHJOLJHQW
SUHVHQW HYLGHQFH IURP ZKLFK D MXU\ FRXOG FRQFOXGH WKDW LQIOLFWLRQRIHPRWLRQDOGLVWUHVVDQGDVXSHUIOXRXVFODLPIRU
'HQQ\¶VDUWLFXODWHGQRQGLVFULPLQDWRU\UHDVRQIRULWVDFWLRQV ZLOOIXODQGZDQWRQFRQGXFW´ -$DWQ 7KHGLVWULFW
ZDVSUHWH[WXDO7KHPDMRULW\RSLQLRQLPSOLHVWKDW'HQQ\¶V FRXUW¶VGHFLVLRQLQWKLVUHJDUGLVQRWDWLVVXHRQDSSHDO
GLGQRWHYHQVXFFHHGLQSUHVHQWLQJVXFKUHDVRQVEHFDXVHLWGLG
QRWSURGXFHWKHVSHFLILFFXVWRPHUFRPSODLQWVRUHYLGHQFHWKDW 'HIHQGDQW ILOHG D PRWLRQ IRU VXPPDU\ MXGJPHQW RQ
/RJDQZDVFRXQVHOHGDERXWWKHP%XW'HQQ\¶VRIFRXUVH $SULO ZLWK UHVSHFW WR WKH UHPDLQLQJ FRXQWV
ZDVUHTXLUHGRQO\WRSURGXFHVRPHHYLGHQFHWRVXSSRUWLWV 'HIHQGDQWPDLQWDLQHGWKDW3ODLQWLIIGLGQRWHVWDEOLVKDSULPD
DUWLFXODWHG QRQGLVFULPLQDWRU\ UHDVRQ 6HH 5HHYHV Y IDFLH FDVH RI GLVFULPLQDWLRQ XQGHU 7LWOH 9,, LQDVPXFK DV
6DQGHUVRQ3OXPELQJ3URGV,QF866 3ODLQWLIIIDLOHGWRGHPRQVWUDWHWKHHOHPHQWVRIDFRQVWUXFWLYH
&W 'HQQ\¶V FOHDUO\ GLG VR $QG WKH GLVFKDUJHDQGWKHUHIRUHIDLOHGWRHVWDEOLVKWKDWVKHVXIIHUHG
PDMRULW\¶V FRQFOXVLRQ LV IDFLOLWDWHG E\ LWV HDUOLHU PLVWDNHQ WKH UHTXLVLWH DGYHUVH HPSOR\PHQW DFWLRQ IRU D SULPD IDFLH
KROGLQJ WKDW WKH HYLGHQFH 'HQQ\¶V GLG SURGXFH ZRXOG EH FDVH 3ODLQWLII ILOHG D PHPRUDQGXP LQ RSSRVLWLRQ WR
GLVUHJDUGHG/RJDQ¶VFRQFOXVRU\RSLQLRQVWKDWQRQPLQRULW\ 'HIHQGDQW¶VPRWLRQIRUVXPPDU\MXGJPHQW 'HIHQGDQWILOHG
VHUYHUVUHFHLYHGEHWWHUWUHDWPHQWWKDQVKHDUHQRWVXIILFLHQWWR D UHSO\ DQG 'HIHQGDQW WKHUHDIWHU ILOHG D VXSSOHPHQW WR LWV
SURYHSUHWH[WDQGWKHUHFRUGVLPSO\GRHVQRWFRQWDLQIDFWXDO PRWLRQ
VXSSRUW IRU WKH PDMRULW\¶V FRQFOXVLRQ WKDW ³D UHDVRQDEOH
SHUVRQFRXOGFRQFOXGHWKDW'HIHQGDQWWRRNFDOFXODWHGHIIRUWV 2Q 2FWREHU WKH GLVWULFW FRXUW LVVXHG LWV
WR SRUWUD\ 3ODLQWLII DV EHLQJ D SRRU VHUYHU DQG KXPLOLDWHG PHPRUDQGXPRSLQLRQDQGRUGHUJUDQWLQJ'HIHQGDQW¶VPRWLRQ
3ODLQWLIILQWRUHVLJQLQJEHFDXVHVKHZDVDEODFNVHUYHUZKR IRU VXPPDU\ MXGJPHQW RQ WKH EDVLV WKDW 3ODLQWLII IDLOHG WR
ZDVDFWXDOO\YHU\JRRGDWKHUMREDQGSRVHGDWKUHDWWRKHU HVWDEOLVKDSULPDIDFLHFDVHRIUDFHGLVFULPLQDWLRQXQGHU7LWOH
ZKLWHFRXQWHUSDUWV´ 9,, 6SHFLILFDOO\ WKH FRXUW IRXQG WKDW 3ODLQWLII IDLOHG WR
HVWDEOLVK D FRQVWUXFWLYH GLVFKDUJH IRU SXUSRVHV RI
,QVXP/RJDQSUHVHQWHGVRPHHYLGHQFHWKDWWKHSHRSOHDW GHPRQVWUDWLQJDQDGYHUVHHPSOR\PHQWDFWLRQ7KHGLVWULFW
'HQQ\¶VLQFOXGLQJVRPHLQPDQDJHPHQWWUHDWHGKHUSRRUO\ FRXUWUHFRJQL]HGWKDW³>D@FODLPWKDWWKHDGYHUVHHPSOR\PHQW
RULQVHQVLWLYHO\6HH0LOHVY*HQHUDO0RWRUV&RUS1R DFWLRQ ZDV DFFRPSOLVKHG YLD FRQVWUXFWLYH GLVFKDUJH LV
:/ DW
WK&LU0DU ³7KH FRJQL]DEOHXQGHU7LWOH9,, ´KRZHYHUWKHFRXUWRSLQHGWKDW
FRXUWDSSHDUHGWRUHVWRQDJHQHUDOIHHOLQJWKDW0LOHVKDGEHHQ 3ODLQWLIIIDLOHGWRFRPHIRUZDUGZLWKVXIILFLHQWHYLGHQFHWR
WUHDWHG VKDEELO\ UDWKHU WKDQ RQ DQ\ HYLGHQFH WKDW ZRXOG HVWDEOLVKWKDWVKHVXIIHUHGDFRQVWUXFWLYHGLVFKDUJHEHFDXVH
MXVWLI\WKHFRQFOXVLRQWKDWPDQDJHPHQW¶VVWDWHGUHDVRQVZHUH VKH IDLOHG WR VKRZ WKDW WKH ³ZRUNLQJ FRQGLWLRQV ZHUH VR
QRQH[LVWHQWRUSUHWH[WXDO´ %XWVKHZDVUHTXLUHGWRSUHVHQW GLIILFXOWRUXQSOHDVDQWWKDWDUHDVRQDEOHSHUVRQLQSODLQWLII¶V
HYLGHQFHWKDWVKHZDVFRQVWUXFWLYHO\GLVFKDUJHGEHFDXVHRI VKRHV ZRXOG IHHO FRPSHOOHG WR UHVLJQ´ RU WKDW ³'HIHQGDQW
KHUUDFH6KHGLGQRWFDUU\WKDWEXUGHQ LQWHQGHG WR FDXVH WKH HPSOR\HH WR UHVLJQ RU WKDW >KHU@
UHVLJQDWLRQZDVDUHDVRQDEO\IRUHVHHDEOHFRQVHTXHQFHRIWKH
'HIHQGDQW¶VDFWLRQ´ -$DW 7KHFRXUWDGGHGLQD
IRRWQRWHWKDW³>H@YHQLI3ODLQWLIIFRXOGPXVWHUDSULPDIDFLH
FDVHVKHFRXOGQRW±EDVHGRQWKHHYLGHQFHLQWKHUHFRUG±
VKRZ WKDW 'HIHQGDQW¶V UHDVRQ IRU FKDQJLQJ KHU MRE
7KLV ODWWHU REVHUYDWLRQ LV RI FRXUVH D GHWHUPLQDWLRQ RI WKH XOWLPDWH FODVVLILFDWLRQ 3ODLQWLII¶VZRUNSHUIRUPDQFH ZDVDSUHWH[WIRU
IDFW DW LVVXH KHUH
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
LQWHQWLRQDOUDFLDOGLVFULPLQDWLRQ´ -$DWQ 5HJDUGLQJ /RJDQWUDQVIHUUHGLQWRWKH+LJKODQG+HLJKWVUHVWDXUDQWZKHUH
3ODLQWLII¶VUHPDLQLQJVWDWHODZFODLPIRULQWHQWLRQDOLQIOLFWLRQ WKHRWKHUVHUYHUVDQGWKHLUVFKHGXOHVZHUHDOUHDG\HVWDEOLVKHG
RIHPRWLRQDOGLVWUHVVWKHGLVWULFWFRXUWIRXQGWKDWQRJHQXLQH LV QRW D UHOHYDQW DVSHFW RI /RJDQ¶V HPSOR\PHQW VWDWXV ,
LVVXH RI PDWHULDO IDFW UHPDLQHG IRU WULDO WKDW 'HIHQGDQW¶V GLVDJUHH ,Q P\ YLHZ WKLV LV SUREDEO\ WKH PRVW UHOHYDQW
DFWLRQVGLGQRWULVHWRWKHOHYHORIH[WUHPHDQGRXWUDJHRXV FRPSDULVRQSDUWLFXODUO\ZLWKUHJDUGWR/RJDQ¶VFODLPWKDWVKH
EHKDYLRUIRUSXUSRVHVRIVDWLVI\LQJWKHUHTXLUHPHQWVRIWKLV VKRXOGKDYHEHHQJLYHQEHWWHUKRXUVDQGEHWWHUORFDWLRQVLQ
FODLP WKHUHVWDXUDQW/RJDQ¶VRZQGHSRVLWLRQWHVWLPRQ\LQGLFDWHV
WKDWWKHVHUYHUVZHUHYRFDODERXWWKHIDFWWKDWWKH\GLGQRW
7KH GLVWULFW FRXUW HQWHUHG LWV FRUUHVSRQGLQJ MXGJPHQW ZDQWWKHLUVFKHGXOHVFKDQJHGEHFDXVHRIDQHZVHUYHU,QDQ\
JUDQWLQJ 'HIHQGDQW¶V PRWLRQ IRU VXPPDU\ MXGJPHQW DQG HYHQW /RJDQ QDPHG RQO\ RQH &DXFDVLDQ VHUYHU ZKR VKH
GLVPLVVLQJ3ODLQWLII¶VFDVHDQGLWLVIURPWKLVMXGJPHQWWKDW FODLPHG ZDV JLYHQ PRUH KRXUV DQG EHWWHU ORFDWLRQV LQ WKH
3ODLQWLIIQRZDSSHDOVFKDOOHQJLQJRQO\WKHGLVPLVVDORIKHU UHVWDXUDQWWKDQVKHZDV+RZHYHU/RJDQDGPLWWHGWKDW-R\
7LWOH9,,FODLP 5HGPRQGDQ$IULFDQ$PHULFDQVHUYHUZKRKDGEHHQDWWKH
+LJKODQG+HLJKWVORFDWLRQIRUVRPH\HDUVZDVDOVRJLYHQ
)DFWV EHWWHUKRXUVDQGPRUHOXFUDWLYHORFDWLRQVWKDQ/RJDQ7KH
PDMRULW\RSLQLRQGLVFRXQWVWKLVDGPLVVLRQRQWKHEDVLVWKDW
3ODLQWLIIEHJDQZRUNLQJIRU'HIHQGDQWLQ$XJXVWRI DW 5HGPRQGZDVQRWDIXOOWLPHVHUYHUEXWWKHUHFRUGUHIOHFWV
LWV UHVWDXUDQW ORFDWHG LQ 1RUWK 5DQGDOO 2KLR ,Q WKDW DIWHU ILUVW LGHQWLI\LQJ 5HGPRQG DV D IXOOWLPH VHUYHU
3ODLQWLII WUDQVIHUUHG WR 'HIHQGDQW¶V UHVWDXUDQW ORFDWHG LQ /RJDQODWHUVDLGWKDWVKHGLGQRWNQRZZKHWKHU5HGPRQGZDV
+LJKODQG+HLJKWV2KLREHFDXVH'HIHQGDQWFORVHGWKH1RUWK IXOOWLPHRUSDUWWLPH7KHUHLVQRHYLGHQFHLQWKHUHFRUGWKDW
5DQGDOO IDFLOLW\ 7KH UHFRUG LQGLFDWHV WKDW WKURXJKRXW 5HGPRQG ZDV SDUWWLPH /RJDQ FODLPV WKDW QR VHUYHU
3ODLQWLII¶VWHQXUHDWWKH1RUWK5DQGDOOORFDWLRQDOOEXWRQHRI UHFHLYLQJD0\VWHU\6KRSSHUUHSRUWVLPLODUWRKHUVZDVHYHU
KHUSHUIRUPDQFHHYDOXDWLRQVEHDUVDQRYHUDOOUDWLQJRI³$7 VXEMHFWHGWRKDYLQJWKHUHSRUWSRVWHG6KHLGHQWLILHVQRRWKHU
67$1'$5'6 ± 3HUIRUPDQFH LV RYHUDOO HTXDO WR RU EHWWHU VHUYHU KRZHYHU ZKR HYHU UHFHLYHG VXFK D UHSRUW /RJDQ
WKDQ WKH VWDQGDUG UHTXLUHG´ RU ³$%29( 67$1'$5'6 ± LGHQWLILHVQRRWKHUVHUYHUZKRUHFHLYHGDUHSRUWVLPLODUWRKHUV
3HUIRUPDQFHLVQRWLFHDEO\EHWWHUWKDQUHTXLUHG´ -$DW ZKR ZDV QRW WROG WKDW KHU FRQWLQXHG HPSOR\PHQW ZDV
7KHHYDOXDWLRQIRUPVWKHPVHOYHVDUHVWDQGDUGL]HGIRUPV FRQGLWLRQHGRQKHUWDNLQJDSRVLWLRQDVDVHUYLFHDVVLVWDQWQRU
ZKLFK OLVW YDULRXV GXWLHV DWWHQGDQW WR WKH UHVSHFWLYH MRE GRHVVKHFODLPWKDWVKHDWWHPSWHGWRREWDLQWKLVLQIRUPDWLRQ
SRVLWLRQ DQG UHTXLUH WKH UHYLHZHU WR UDWH WKH HPSOR\HH¶V WKURXJKGLVFRYHU\EXWZDVGHQLHGWKHRSSRUWXQLW\WRGRVR
SHUIRUPDQFH DV WR WKHVH GXWLHV DV ³%HORZ 6WDQGDUGV´ ³$W )LQDOO\/RJDQFODLPVWKDWRWKHU$IULFDQ$PHULFDQWUDQVIHUHHV
6WDQGDUGV´ RU $ERYH 6WDQGDUGV´ $W WKH HQG RI WKH IURP5DQGDOO3DUNGLGQRWODVWORQJDW+LJKODQG+HLJKWVEXW
HYDOXDWLRQ WKH UHYLHZHU UDWHV WKH HPSOR\HH¶V RYHUDOO VKHSURYLGHVQHLWKHUWKHLGHQWLWLHVRIVXFK SHUVRQVQRUDQ\
SHUIRUPDQFHXVLQJWKHVDPHUDWLQJVFDOH$VLQGLFDWHGRQO\ LQIRUPDWLRQ DERXW WKHLU HPSOR\PHQW DW RU GHSDUWXUH IURP
RQH RI 3ODLQWLII¶V HOHYHQ HYDOXDWLRQV LQFOXGHG LQ WKH MRLQW 'HQQ\¶V ,Q VKRUW , EHOLHYH WKDW /RJDQ IDLOHG WR SUHVHQW
DSSHQGL[ EHDUV DQ RYHUDOO UDWLQJ RI ³%(/2: HYLGHQFH IURP ZKLFK D MXU\ FRXOG FRQFOXGH WKDW VKH ZDV
67$1'$5'6´ DOWKRXJK DW WLPHV VKH ZDV UDWHG EHORZ WUHDWHG OHVV IDYRUDEO\ WKDQ QRQPLQRULW\ VHUYHUV DW WKH
VWDQGDUGVUHJDUGLQJYDULRXVDVSHFWVRIKHUMRE +LJKODQG+HLJKWVVWRUH
,QDGGLWLRQWRWKHVWDQGDUGL]HGUDWLQJVWKHHYDOXDWLRQVDOVR %HFDXVH , WKLQN WKDW /RJDQ IDLOHG WR SUHVHQW VXIILFLHQW
SURYLGH D VSDFH IRU WKH UHYLHZHU WR LQFOXGH KDQGZULWWHQ HYLGHQFHWRPDNHRXWDSULPDIDFLHFDVH,ZRXOGDIILUPWKH
FRPPHQWV)RUH[DPSOHRQZKDWDSSHDUVWREH3ODLQWLII¶V
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
7KH PDMRULW\ RSLQLRQ¶V FKDUDFWHUL]DWLRQ RI WKH ³QHZ WLH´ VL[PRQWKHYDOXDWLRQGDWHG)HEUXDU\ WKHUHYLHZHU
LQFLGHQWDVUDFLDOO\PRWLYDWHGLVVLPLODUO\WURXEOLQJ/RJDQ¶V $VVLVWDQW 0DQDJHU 7LPRWK\ - 0F*XLUH UDWHG 3ODLQWLII DV
GHSRVLWLRQ FOHDUO\ GHPRQVWUDWHV WKDW VKH KDV QR LGHD ZKDW ³$7 67$1'$5'6´ RYHUDOO DQG SURYLGHG WKH IROORZLQJ
'HQQ\¶V SROLF\ ZLWK UHJDUG WR WLHV ZDV RU ZKDW WKH KDQGZULWWHQFRPPHQWV
FLUFXPVWDQFHVZHUHZLWKUHJDUGWRWKLVSDUWLFXODUWLH/RJDQ
FDPHWRZRUNZLWKRXWKHUWLH6KHZDVQRWSURYLGHGDQHZ ,Q(LOHHQ¶VILUVWPRQWKVVKHKDVEHHQDUHOLDEOHDQG
RQH$ZKLWHHPSOR\HHFDPHWRZRUNDQGZDVJLYHQDQHZ HIILFLHQW FRQFHUQHGHPSOR\HH+HUSOHDVDQWDWWLWXGH
WLH/RJDQDGPLWVWKDWVKHGRHVQRWNQRZDQGGLGQRWLQTXLUH DQG KHU SURIHVVLRQDO PDQQHU GR QRW JR XQQRWLFHG E\
ZKHWKHU WKH ZKLWH HPSOR\HH KDG HDUOLHU UHTXHVWHG RU EHHQ PDQDJHPHQW QRU JXHVWV (LOHHQ KDV VKRZQ IOH[DELOLW\
SURPLVHGDQHZWLHEXWVKHGRHVVD\WKDWWKHZKLWHHPSOR\HH >VLF@ZLWKKHUKRXUVRQWKHZHHNHQG6KHKDVZRUNHG
WROG KHU ³, ILQDOO\ JRW D QHZ WLH´ 1RQHWKHOHVV /RJDQ ERWKVWDQGQGVKLIW>V@DQGRQPDQ\RFFDVLRQVVKHKDV
FRPSODLQVWKDWLIWKHUHZDVRQO\RQHWLH/RJDQVKRXOGKDYH KHOSHGPDJPW>PDQDJHPHQW@ZKHQZHKDYHEHHQVKRUW
JRWWHQ LW 7KH HYLGHQFH LQ WKH UHFRUG GRHV QRW VXSSRUW D VWDIIHG5HFHQWO\(LOHHQKDGKHUKRXUVFKDQJHGDWKHU
UHDVRQDEOHLQIHUHQFHWKDW/RJDQZDVGHQLHGDWLHEHFDXVHRI RWKHU MRE 6KH WKRXJKW WKDW VKH PLJKW KDYH WR OHDYH
KHUUDFH 'HQQ\¶V0DQDJHPHQWZRUNHGDURXQGKHUQHZVFKHGXOH
WRDVVXUHWKDW(LOHHQFRXOGFRQWLQXHWRZRUNIRU
)LQDOO\ WKH PDMRULW\ RSLQLRQ KROGV WKDW /RJDQ DGGXFHG +HUZLOOLQJQHVVWREHIOH[LEOHVKRZHGPDQDJHPHQWWKDW
³FRSLRXV´HYLGHQFHZLWKUHJDUGWRWKHVHFRQGSURQJRIWKH WKDW >VLF@ VKH LV D FDULQJ HPSOR\HH DQG WR ORVH DQ
FRQVWUXFWLYHGLVFKDUJHDQDO\VLV ZKHWKHU'HQQ\¶VLQWHQGHGE\ HPSOR\HHZLWKWKLVW\SHRIDWWLWXGHZRXOGKDYHEHHQD
LWV DFWLRQV WR IRUFH /RJDQ WR TXLW KHU MRE 7KH RIIHQVLYH GLVVHUYLFH$VVKRZQDERYH(LOHHQLVQRWZHDNLQDQ\
FRPPHQWVUHIHUULQJWRFXVWRPHUVIURP5DQGDOO3DUN0DOODQG DUHDV6KHLVFRPSHWHQWLQVHUYLFHWHDPZRUNDQGWKH
'HQQ\¶VWUHDWLQJRWKHUVHUYHUVPRUHIDYRUDEO\WKDQ/RJDQ RWKHUDVSHFWVRIWKHMREFRGHVHUYHU
ZKHQWDNHQWRJHWKHUZLWKWKHFKDQJHLQSRVLWLRQWKHPDMRULW\
VD\VDUHPRUHWKDQVXIILFLHQWWRFUHDWHDJHQXLQHLVVXHRIIDFW (LOHHQ,ZRXOGOLNHWRWDNHWKLVWLPHWRWKDQN\RXIRU
DVWR'HQQ\¶VLQWHQW%XWWKHFRPPHQWVDV,KDYHH[SODLQHG \RXU HIIRUWV DQG , VXJJHVW WKDW \RX FRQWLQXH WR GR WKH
DUHQRWUDFLDOLQQDWXUHDQG/RJDQSUHVHQWHGOLWWOHHYLGHQFH WKLQJVWKDW\RXKDYHGRQHLQWKHSDVWWRFRQWLQXHWRJURZ
WKDW'HQQ\¶VLQIDFWWUHDWHGRWKHUVHUYHUVEHWWHUWKDQLWWUHDWHG ZLWKERWKWKHXQLWDQG'HQQ\¶V
KHU
-$DW
7KHILQDOHOHPHQWLQWKHSULPDIDFLHFDVHLVWKDW'HQQ\¶V
WUHDWHGVLPLODUO\VLWXDWHGLQGLYLGXDOVPRUHIDYRUDEO\WKDQLW 3ODLQWLII¶V QH[W HYDOXDWLRQ GDWHG $XJXVW VL[
WUHDWHG/RJDQ+HUHDJDLQWKHUHFRUGGRHVQRWVXSSRUWWKH PRQWKV DIWHU WKH ILUVW HYDOXDWLRQ LQGLFDWHV WKDW D GLIIHUHQW
PDMRULW\RSLQLRQ¶VFRQFOXVLRQWKDW/RJDQSUHVHQWHGVXIILFLHQW DVVLVWDQW PDQDJHU UDWHG 3ODLQWLII¶V RYHUDOO SHUIRUPDQFH DV
HYLGHQFHWRFUHDWHDJHQXLQHLVVXHRIIDFWZLWKUHJDUGWRWKLV ³$7 67$1'$5'6´ DQG KH SURYLGHG WKH IROORZLQJ
HOHPHQW7KHPDMRULW\RSLQLRQFRUUHFWO\VD\VWKDWWKLVFRXUW¶V KDQGZULWWHQFRPPHQW
SUHFHGHQWUHTXLUHVWKDWZHIRFXVRQZKHWKHUWKHSODLQWLIILV
VLPLODUO\ VLWXDWHG LQ DOO RI WKH UHOHYDQW DVSHFWV WR WKRVH (LOHHQRYHUDOO\RXUSHUIRUPDQFHLV³DWVWDQGDUGV´$OO
HPSOR\HHV WR ZKRP VKH FRPSDUHV KHU VLWXDWLRQ 6HH \RXUZRUNZLWKWUDLQLQJQHZKLUHVZLWKDOVR\RXU[WUD
(UFHJRYLFKY*RRG\HDU7LUH 5XEEHU&R)G HIIRUWVLQZRUNLQJRYHUDQGDVVXULQJJRRGJXHVWVHUYLFH
WK&LU 7KHPDMRULW\WKHQKROGVWKDWWKHIDFWWKDW LVDSSUHFLDWHGVLF@DELJKHOSWRRXU
XQLWV>VLF@RSHUDWLRQV$IHZDUHDVWRFRQVLGHUIRU\RXU
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
QH[W UHYLHZ $ VHJJXVWLYH >VLF@ VHOO VHOO XS HWF DXWKRULWLHV UDLVLQJ RWKHU NLQGV RI GLVFULPLQDWLRQ FODLPV LQ
% \RX PD\ ZDQW WR JR DQ H[WUD VWHS WR KHOS RXW FR DUULYLQJDWLWVFRQFOXVLRQVLQFOXGLQJ5RJHUVY((2&
ZRUNHUV ZKHQ LQ QHHG & FOHDQLQJ DV \RX JR D OLWWOH )G WK&LU KROGLQJWKDW³PHUHXWWHUDQFHRI
PRUH WKURXJKO\ >VLF@ ZLQGRZV VHDWV OHGJHV HWF> @ DQHWKQLFRUUDFLDOHSLWKHWZKLFKHQJHQGHUVRIIHQVLYHIHHOLQJ
(LOHHQ FRQWLQXH WR LPSURYH WKDQNV IRU DOO \RXU JRRG LQ DQ HPSOR\HH´ GRHV QRW ULVH WR WKH OHYHO RI D 7LWOH 9,,
HIIRUWV YLRODWLRQ DQG%/LQGHUPDQQ 3*URVVPDQ(PSOR\PHQW
'LVFULPLQDWLRQ /DZ G HG FLWLQJ FDVHV
-$DW LQVWUXFWLQJ DPRQJ RWKHU WKLQJV WKDW ³D ODFN RI UDFLDO
VHQVLWLYLW\ GRHV QRW DORQH DPRXQW WR DFWLRQDEOH
7KHQH[WHYDOXDWLRQSURYLGHGLQWKHMRLQWDSSHQGL[LVGDWHG KDUDVVPHQW´ )DUDJKHU86DW7KH&RXUWQRWHG
)HEUXDU\RI LWLVIURPWKHVDPHDVVLVWDQWPDQDJHUDQG WKDW³>D@OWKRXJKUDFLDODQGVH[XDOKDUDVVPHQWZLOORIWHQWDNH
UDWHV3ODLQWLIIDV³$767$1'$5'6´RYHUDOOEXWGRHVQRW GLIIHUHQW IRUPV DQG VWDQGDUGV PD\ QRW EH HQWLUHO\
EHDU DQ\ KDQGZULWWHQ FRPPHQWV -$ DW 7KH LQWHUFKDQJHDEOH ZH WKLQN WKHUH LV JRRG VHQVH LQ VHHNLQJ
IROORZLQJ HYDOXDWLRQ GDWHG 0D\ IURP $VVLVWDQW JHQHUDOO\ WR KDUPRQL]H WKH VWDQGDUGV RI ZKDW DPRXQWV WR
0DQDJHU 0LFKDHO $ /HZLV DOVR UDWHV 3ODLQWLII DV ³$7 DFWLRQDEOHKDUDVVPHQW´,GDWQ$QGWKLVFLUFXLWKDV
67$1'$5'6´RYHUDOODQGSURYLGHVDKDQGZULWWHQFRPPHQW DSSOLHGWKH)DUDJKHUVWDQGDUGLQUDFHFDVHVVLQFHVKRUWO\DIWHU
LQGLFDWLQJDUHDVLQZKLFK3ODLQWLIIQHHGHGWRLPSURYHDVZHOO WKDWFDVHZDVGHFLGHG6HHHJ-DFNVRQY4XDQH[&RUS
DVWKHFRPPHQW ³VLF@JRRGFXVWRPHUUHODWLRQV )G WK&LU FLWLQJ)DUDJKHUIRUWKH
NHHS XS WKH JRRG VHUYLFH´ -$ DW 3ODLQWLII¶V QH[W SURSRVLWLRQ WKDW ³µVLPSOH WHDVLQJ¶ RIIKDQG FRPPHQWV DQG
HYDOXDWLRQGDWHG2FWREHU IURP$VVLVWDQW0DQDJHU LVRODWHGLQFLGHQWV´RUGLQDULO\GRQRWDPRXQWWRGLVFULPLQDWLRQ
*LQD +LQGH UDWHV 3ODLQWLII DV ³$%29( 67$1'$5'6´ XQGHU7LWOH9,,
RYHUDOODQGSURYLGHVVXJJHVWHGDUHDVRILPSURYHPHQWLQWKH
FRPPHQWVVHFWLRQDORQJZLWKWKHQRWDWLRQ³2YHUDOO\RX¶UH 1RQH RI WKH FRPPHQWV WKH PDMRULW\ FKDUDFWHUL]HV DV
GRLQJJUHDW±.HHSLWXS´ -$DW 6LPLODUO\3ODLQWLII¶V FDUU\LQJWKHLQIHUHQFHRILQYLGLRXVGLVFULPLQDWLRQLVRYHUWO\
HYDOXDWLRQGDWHG2FWREHURI IURPDGLIIHUHQWDVVLVWDQW UDFLDOLQFKDUDFWHU7KHFRPPHQW³ZHGRQ¶WVHUYHJULWVKHUH´
PDQDJHUUDWHV3ODLQWLIIDV³$%29(67$1'$5'6´ ZKLFK HYHQ /RJDQ DGPLWV ZDV PDGH LQ UHVSRQVH WR KHU
TXHVWLRQ DERXW WKH DYDLODELOLW\ RI YDULRXV EUHDNIDVW LWHPV
3ODLQWLII¶VQH[WWZRHYDOXDWLRQVGDWHG$XJXVW DQG FDUULHVDUDFLDORYHUWRQHRQO\LIJULWVZHUHIRRGHQMR\HGRQO\
-DQXDU\ HDFKUDWH3ODLQWLII¶VRYHUDOOSHUIRUPDQFHDV RUHYHQSULPDULO\E\$IULFDQ$PHULFDQV
7KHRWKHUWZR
³$7 67$1'$5'6´ 3ODLQWLII¶V HYDOXDWLRQ LQ $XJXVW RI FRPPHQWVRIZKLFK/RJDQFRPSODLQV³WKDQN WKH SHRSOH LQ WKH UHVW RI WKH FRXQWU\ ZKR KDYH OHDUQHG WKH YLUWXH RI JULWV
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
W\SLFDO GLVFULPLQDWRU\ FRQVWUXFWLYH GLVFKDUJH FDVH WKH \RX@ IRU DOO WKH GHGLFDWHG DQG HIIHFWLYH WHDP ZRUN
HPSOR\HU GRHV QRW RYHUWO\ VHHN D GLVFRQWLQXDWLRQ LQ WKH +DYHDQLFHGD\
HPSOR\PHQW UHODWLRQVKLS EXW WKH HPSOR\HH FODLPV WR EH
VXEMHFWHG WR LQWROHUDEOH ZRUNLQJ FRQGLWLRQV GXH WR -$DW 7KLVHYDOXDWLRQDOVRLQGLFDWHVWKDW3ODLQWLIIZDV
GLVFULPLQDWRU\EHKDYLRU´,VHHQRUHDVRQWRORRNWRWKHODZ UHFHLYLQJ D SD\ LQFUHDVH IURP SHU KRXU WR SHU
RIWKH)LIWK&LUFXLWDVWKHPDMRULW\GRHVWRGHWHUPLQHZKDW KRXU)LQDOO\3ODLQWLII¶VHYDOXDWLRQIURP DSSDUHQWO\LQ
FRQVWLWXWHVDFRQVWUXFWLYHGLVFKDUJH 6HSWHPEHU RI LQGLFDWHV WKDW VKH UHFHLYHG DQ ³$7
67$1'$5'6´UDWLQJ
7KHPDMRULW\RSLQLRQFRQFOXGHV²LQSDUWE\WDNLQJMXGLFLDO
QRWLFHRIWKH³IDFW´WKDWWKHEXVER\SRVLWLRQZRXOGQHFHVVDULO\ ,WZDVQRWXQWLOZKDWDSSHDUVWREH3ODLQWLII¶VODVWHYDOXDWLRQ
EHDGHPRWLRQDQGE\KROGLQJLQDGPLVVLEOHDOORIWKHDIILGDYLW DW'HIHQGDQW¶V1RUWK5DQGDOOIDFLOLW\GDWHG-DQXDU\
WHVWLPRQ\ RI 'HQQ\¶V ZLWQHVVHV²WKDW /RJDQ KDV WKDWVKHUHFHLYHGD³%(/2:67$1'$5'6´UDWLQJ)RUWKH
GHPRQVWUDWHGWKDW'HQQ\¶V³FRQGLWLRQLQJ3ODLQWLII¶VFRQWLQXHG ILUVWWLPHRQDQ\RIKHUHYDOXDWLRQVDVSURYLGHGLQWKHMRLQW
HPSOR\PHQWRQKHUEHFRPLQJDEXVER\FUHDWHGDQLQWROHUDEOH DSSHQGL[ 3ODLQWLII ZURWH D FRPPHQW LQ WKH ³HPSOR\HH
ZRUN FRQGLWLRQ VXFK WKDW D UHDVRQDEOH SHUVRQ VWDQGLQJ LQ FRPPHQWV´VHFWLRQRIWKHHYDOXDWLRQ6SHFLILFDOO\3ODLQWLII
3ODLQWLII¶VVKRHVZRXOGKDYHIHOWFRPSHOOHGWRUHVLJQ´7KH ZURWHDVIROORZV
FODLP RI FRQVWUXFWLYH GLVFKDUJH LV EROVWHUHG WKH RSLQLRQ
FRQFOXGHV EHFDXVH WKH FODLPHG FRQVWUXFWLYH GLVFKDUJH 7KLVHYDOXDWLRQLVYHU\LQFRUUHFW,KDYHSXW1$¶VQH[W
RFFXUUHGDIWHU/RJDQZDVVXEMHFWHGWR³GLVSDUDJLQJFRPPHQWV WR DOO WKH WKLQJV , DP LQFRUUHFWO\ PDUNHG RQ 3OHDVH
DQG DOOHJHG LQFLGHQWV RI XQIDLU WUHDWPHQW´ %XW XQOHVV WKH UHYLHZ FRUUHFWO\ , DP YHU\ LQVXOWHG LQ WKLV UHYLHZ
LQWROHUDEOHZRUNFRQGLWLRQZDVVKRZQWRKDYHEHHQFUHDWHG 7KLVLVWKHZRUVWRQH,¶YHJRWWHQDW'HQQ\¶VVLQFHP\
EHFDXVHRI/RJDQ¶VUDFHWKHFRQVWUXFWLYHGLVFKDUJHLVQRWRQH KLUHGDWHLQ ,ZLOOIROORZXSRQWKLV0U&URVV
IRUZKLFK/RJDQKDVDQ\UHPHG\XQGHU7LWOH9,,
-$DW 7KH³0U&URVV´WRZKLFK3ODLQWLIIPDNHV
,W LV WKHUHIRUH LPSRUWDQW WR H[DPLQH WKH FRPPHQWV DQG UHIHUHQFHLQKHUFRPPHQWLVLGHQWLILHGRQWKHHYDOXDWLRQDVWKH
LQFLGHQWVZKLFK/RJDQFODLPVDQGWKHPDMRULW\ILQGVZHUH ³0DQDJHU´ $SSDUHQWO\ XQOLNH LQ 3ODLQWLII¶V SUHYLRXV
UDFLDOLQQDWXUH,ZRXOGKROGWKDWWKHGLVWULFWFRXUWGLGQRWHUU HYDOXDWLRQV LW ZDV 0DQDJHU &URVV DQG QRW WKH DVVLVWDQW
LQGHWHUPLQLQJWKDWWKHUHFRUGVLPSO\GRHVQRWVXSSRUWVXFKD PDQDJHUZKRODWHUVLJQHGWKHHYDOXDWLRQRQ0DUFK
FRQFOXVLRQEXWHYHQLILWGLGWKHVHFRPPHQWVGRQRWULVHWR ZKR DFWXDOO\ FRQGXFWHG WKH HYDOXDWLRQ EHFDXVH &URVV¶
WKHOHYHOUHTXLUHGWRFUHDWHDKRVWLOHZRUNHQYLURQPHQW,Q VLJQDWXUH EHDUV WKH VDPH GDWH DV WKDW RI WKH HYDOXDWLRQ
)DUDJKHUY%RFD5DWRQ86 WKH6XSUHPH -DQXDU\ ,QWHUHVWLQJO\KRZHYHUERWK3ODLQWLIIDQG
&RXUW PDGH LW FOHDU WKDW D KRVWLOHZRUNHQYLURQPHQW FODLP WKHDVVLVWDQWPDQDJHUZKRDWWKLVSRLQWZDV/LQGD7D\ORUGLG
PXVWEHVXSSRUWHGE\HYLGHQFHRIH[WUHPHFRQGXFWDQGWKDW QRWVLJQWKHHYDOXDWLRQXQWLO0DUFK GHVSLWHWKHIDFW
WKH³VWDQGDUGVRIMXGJLQJKRVWLOLW\DUHVXIILFLHQWO\GHPDQGLQJ WKDW WKH HYDOXDWLRQ EHDUV WKH -DQXDU\ GDWH DV GRHV &URVV¶
WRHQVXUHWKDW7LWOH9,,GRHVQRWEHFRPHDµJHQHUDOFLYLOLW\ VLJQDWXUH
FRGH¶ 3URSHUO\ DSSOLHG WKH\ ZLOO ILOWHU RXW FRPSODLQWV
DWWDFNLQJµWKHRUGLQDU\WULEXODWLRQVRIWKHZRUNSODFHVXFKDV ,Q)HEUXDU\RI 3ODLQWLIIDQGWKHRWKHUHPSOR\HHVRI
WKHVSRUDGLFXVHRIDEXVLYHODQJXDJHJHQGHUUHODWHGMRNHV WKH1RUWK5DQGDOOIDFLOLW\ZHUHQRWLILHGWKDW'HIHQGDQWZDV
DQGRFFDVLRQDOWHDVLQJ¶´,GDW$OWKRXJK)DUDJKHUZDV FORVLQJ WKH IDFLOLW\ SHUPDQHQWO\ 3ODLQWLII DQG WKH RWKHU
D VH[XDOKDUDVVPHQW FDVH WKH &RXUW H[SOLFLWO\ UHOLHG RQ HPSOR\HHVZHUHJLYHQWKHRSWLRQRIWUDQVIHUULQJWRDQRWKHU
RQHRI'HIHQGDQW¶VUHVWDXUDQWVLQWKHGLVWULFW±WKHUHVWDXUDQW
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
LQ*DUILHOG+HLJKWVRUWKHUHVWDXUDQWLQ+LJKODQG+HLJKWV± SHUVRQVWDQGLQJLQ3ODLQWLII¶VVKRHVZRXOGKDYHIHOWFRPSHOOHG
LIWKH\GHVLUHG,QUHVSRQVHWRWKHQHZV3ODLQWLIIGLVFXVVHG WRUHVLJQ´7KHPDMRULW\RSLQLRQOHDYHVQRWKLQJIRUWKHILQGHU
KHU RSWLRQV ZLWK KHU JHQHUDO PDQDJHU DW WKH WLPH /LQGD RIIDFWWRGRRQUHPDQG
7D\ORU DV ZHOO DV ZLWK WKH JHQHUDO PDQDJHU RI +LJKODQG
+HLJKWVDWWKHWLPH-RKQ+DODV]3ODLQWLIIFODLPVWKDW+DODV] 7XUQLQJWRWKHVXEVWDQFHRI/RJDQ¶VFRPSODLQW,DJUHHZLWK
ZKRDWRQHWLPHKDGEHHQWKHPDQDJHURIWKH1RUWK5DQGDOO WKHPDMRULW\RSLQLRQWKDW/RJDQSUHVHQWHGVXIILFLHQWHYLGHQFH
IDFLOLW\WROGKHUWKDWKHZRXOGEHKRQRUHGWRKDYH3ODLQWLII DVWRWKHILUVWDQGVHFRQGSURQJVRIWKHSULPDIDFLHFDVH,
WUDQVIHU WR WKH +LJKODQG +HLJKWV IDFLOLW\ :KHQ 3ODLQWLII GLVDJUHH ZLWK WKH PDMRULW\ RSLQLRQ¶V UHDVRQLQJ DQG
DVNHG7D\ORUZKHWKHUVKHVKRXOGWUDQVIHUWR*DUILHOG+HLJKWV FRQFOXVLRQVZLWKUHJDUGWRWKHWKLUGDQGIRXUWKHOHPHQWVRI
RUWR+LJKODQG+HLJKWV3ODLQWLIIFODLPVWKDW7D\ORUDGYLVHG /RJDQ¶V SULPD IDFLH FDVH WKDW VKH VXIIHUHG DQ DGYHUVH
KHUWRWUDQVIHUWRWKH+LJKODQG+HLJKWVIDFLOLW\EHFDXVH³LW¶V HPSOR\PHQWDFWLRQDQGWKDWVKHZDVWUHDWHGOHVVIDYRUDEO\
DIDVWHUHQYLURQPHQW´7D\ORUUHLWHUDWHGWR3ODLQWLIIWKDWVKH WKDQDVLPLODUO\VLWXDWHGLQGLYLGXDORXWVLGHKHUSURWHFWHGFODVV
VKRXOGWUDQVIHUWRWKH+LJKODQG+HLJKWVIDFLOLW\EHFDXVHLWZDV 6HH.RFVLVY0XOWL&DUH0JPW,QF )G WK
DIDVWHUHQYLURQPHQWDQGVKHIHOWWKDW3ODLQWLIIZRXOGGRZHOO &LU 7REHJLQZLWKWKLVFLUFXLWKDVZHOOHVWDEOLVKHG
WKHUH3ODLQWLIIVWDWHGWKDWPRVWRIWKHHPSOR\HHVIURPWKH SUHFHGHQWJRYHUQLQJWKHGHWHUPLQDWLRQRIZKHWKHUD7LWOH9,,
1RUWK5DQGDOOIDFLOLW\ZKRGHFLGHGWRUHPDLQHPSOR\HGZLWK SODLQWLIIKDVVDWLVILHGWKHWKLUGSURQJZKHQWKHSODLQWLIIFODLPV
'HIHQGDQWWUDQVIHUUHGWRWKH*DUILHOG+HLJKWVIDFLOLW\EHFDXVH FRQVWUXFWLYHGLVFKDUJHDVWKHDGYHUVHHPSOR\PHQWDFWLRQ,Q
WKH\GLGQRWKDYHDXWRPRELOHVDQG*DUILHOG+HLJKWVZDVRQ :LOVRQY)LUHVWRQH7LUH 5XEEHU&RPSDQ\ )G
WKHEXVOLQHEXW+LJKODQG+HLJKWVZDVQRW WK&LU ZHKHOGWKDW³>D@GHPRWLRQZLWKLQDFRPSDQ\
GRHV QRW DPRXQW WR D FRQVWUXFWLYH GLVFKDUJH XQOHVV WKH
3ODLQWLIIEHJDQZRUNLQJDWWKH+LJKODQG+HLJKWVIDFLOLW\RQ SURIIHUHGHPSOR\PHQWRSWLRQVZRXOGKDYHEHHQµVRGLIILFXOW
0DUFK DQG DFNQRZOHGJHG WKDW VKH ZDV ³YHU\ RU XQSOHDVDQW WKDW D UHDVRQDEOH SHUVRQ LQ WKH HPSOR\HH¶V
KDSS\´DQG³YHU\H[FLWHG´WREHJLQZRUNLQJWKHUH'HIHQGDQW VKRHV ZRXOG KDYH IHOW FRPSHOOHG WR UHVLJQ¶´ ,G DW
FODLPV WKDW 3ODLQWLII ZDV DOORZHG WR WUDQVIHU WR +LJKODQG TXRWLQJL@QWKH
0LOOV 5RDG LQ +LJKODQG +HLJKWV 2KLR
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
SUHVHQWHG²DQGYHU\SUREDEO\QRWDGPLVVLEOH²LQHYLGHQFH ³7KHVHPXVWKDYHEHHQVRPHRI\RXUSHRSOHIURP5DQGDOO´
LQGHWHUPLQLQJZKHWKHUWKHHYLGHQFHEHIRUHWKDWFRXUWSUHVHQWV LQUHIHUHQFHWRVRPHFXVWRPHUVZKRGLGQRWZDQWWRSD\IRU
DJHQXLQHLVVXHRIPDWHULDOIDFW7KHPDMRULW\RSLQLRQKDV WKHLUEUHDNIDVW -$DW 7KHODWWHUFRPPHQWZDVPDGH
WKXVHIIHFWHGDWUDQVPRJULILFDWLRQRIWKHVWDQGDUGRIUHYLHZ E\3ODLQWLII¶VPDQDJHU*UHJ0DOORQ,QDGGLWLRQ3ODLQWLII
DWOHDVWIRU7LWOH9,,GHIHQGDQWVZKLFKPD\KDYHEHHQVXHGIRU FRQWHQGV WKDW WKH ZKLWH VHUYHUV ZHUH SURYLGHG ZLWK PRUH
UDFLDOO\ GLVFULPLQDWRU\ SUDFWLFHV DW RWKHU WLPHV DQG XQGHU KRXUV RI HPSOR\PHQW WKDQ VKH ZDV SURYLGHG DQG WKDW WKH
GLIIHUHQWFLUFXPVWDQFHV ZKLWHVHUYHUVFRQWLQXDOO\WROG3ODLQWLIIWKDWWKHLUKRXUVZHUH
QRWJRLQJWREHFXWEHFDXVHVKHZDVDOORZHGWRWUDQVIHUWR
7KHPDMRULW\RSLQLRQPDNHVQXPHURXVILQGLQJVRIIDFWLQ +LJKODQG +HLJKWV 0RUHRYHU WR WKH EHVW RI 3ODLQWLII¶V
UHDFKLQJLWVFRQFOXVLRQWKDWWKHGLVWULFWFRXUWHUUHGLQJUDQWLQJ NQRZOHGJH QR ZKLWH VHUYHUV WUDQVIHUUHG WR WKH +LJKODQG
VXPPDU\MXGJPHQWWR'HQQ\¶V,WILQGVIRUH[DPSOHWKDWWKH +HLJKWVIDFLOLW\IURPWKH1RUWK5DQGDOOIDFLOLW\7KHUHZDV
MRE FKDQJH RIIHUHG WR /RJDQ ZDV D GHPRWLRQ WKDW /RJDQ RQO\ RQH RWKHU EODFN VHUYHU EHVLGHV 3ODLQWLII DW +LJKODQG
ZRXOG KDYH VXIIHUHG D UHGXFWLRQ LQ VDODU\ LQ WKH QHZ DQG +HLJKWVDQGVKHZDVSDUWWLPH
OHVVHUSRVLWLRQ WKDWWKHMREFKDQJHZDVKXPLOLDWLQJ DQGWKDW
'HQQ\¶VGHVLJQDWLRQRI/RJDQ¶VDVVLJQHGVWDWLRQRQ$SULO 3ODLQWLIIFRPSODLQHGWRPDQDJHPHQW*UHJ0DOORQDQG-RKQ
DV³VWDWLRQHLJKW´ZDVOLNHO\LQWHQGHGWRUHIHUWRWKHPLOLWDU\ +DODV]DERXWDOZD\VEHLQJDVVLJQHGWRWKHEDFNVWDWLRQVRI
WHUPIRUPHQWDOLQVWDELOLW\DQGWKXVZDVLQWHQGHGWRKXPLOLDWH WKHUHVWDXUDQWEHFDXVHLIQRKRVWHVVZDVRQGXW\WKHVHUYHUV
/RJDQ ,W HYHQ LQIHUV WKDW 'HQQ\¶V KDG E\ LWV DFWLRQV ZLWKWKHIURQWVWDWLRQVZRXOGJHWPRUHFXVWRPHUV,QUHVSRQVH
³FUHDWHGDQLQWROHUDEOHZRUNFRQGLWLRQVXFKWKDWDUHDVRQDEOH WR3ODLQWLII¶VFRPSODLQWPDQDJHPHQWEHJDQDVVLJQLQJZRUN
VWDWLRQVLQDURWDWLQJIDVKLRQ+RZHYHULQWLPHWKLVSUDFWLFH
VWRSSHG3ODLQWLIIDOVRUHFDOOHGDQLQFLGHQWLQ0DUFKRI
ZKHQ DIWHU GULYLQJ WZHQW\ILYH PLQXWHV WR ZRUN LQ
,W LV RQH WKLQJ WR DWWHPSW WR RIIHU VXFK HYLGHQFH DW WULDO ZKHUH WKH XQVHDVRQDEOHZHDWKHUVKHUHDOL]HGXSRQDUULYLQJIRUGXW\WKDW
GHIHQGDQW ZRXOG DW OHDVW KDYH WKH RSSRUWXQLW\ WR REMHFW QRW RQO\ EHFDXVH
LW LV SDWHQWO\ KHDUVD\ EXW RQ JURXQGV IRU H[DPSOH WKDW LW YLRODWHV 5XOH
VKHKDGOHIWWKHQHFNWLHWKDWZDVSDUWRIKHUXQLIRUPDWKRPH
E RI WKH )HGHUDO 5XOHV RI (YLGHQFH 6HH %HFNHU Y $5&2 &KHP
3ODLQWLIIZHQWWR0DOORQH[SODLQHGZKDWKDGKDSSHQHGDQG
&R )G G &LU ³$FFRUGLQJO\ EHFDXVH %HFNHU KDV DVNHGLIKHKDGDVSDUHWLHWKDWVKHFRXOGERUURZIRUKHUVKLIW
IDLOHG WR DUWLFXODWH KRZ WKH 6HDYHU HYLGHQFH ILWV LQWR D FKDLQ RI ORJLFDO 0DOORQLQIRUPHG3ODLQWLIIWKDWKHGLGQRWKDYHDVSDUHWLHDQG
LQIHUHQFHV SRLQWLQJ WRZDUGV $5&2¶V LQWHQW ZLWKRXW LQYROYLQJ WKH WKDWVKHZRXOGKDYHWRUHWXUQKRPHLIVKHZDVQRWSURSHUO\
LQIHUHQFH WKDW EHFDXVH $5&2 FRPPLWWHG WKH ILUVW DFW LW ZDV PRUH OLNHO\
DWWLUHG3ODLQWLIIUHPHPEHUHGWKDWVKHKDGDQROGWLHLQWKH
WR KDYH FRPPLWWHG WKH VHFRQG ZH FDQQRW DJUHH ZLWK WKH GLVWULFW
FRXUW¶V FRQFOXVLRQ WKDW WKH HYLGHQFH ZDV DGPLVVLEOH XQGHU 5XOH E WR
WUXQN RI KHU FDU VR VKH ZHQW RXWVLGH JRW WKH WLH DQG
HVWDEOLVK $5&2¶V LQWHQW WR GLVFULPLQDWH DJDLQVW %HFNHU´ $QG HYHQ LI SURFHHGHG ZLWK KHU VKLIW $ERXW DQ KRXU ODWHU 3ODLQWLII
WKLV HYLGHQFH ZHUH IRXQG WR EH DGPLVVLEOH XQGHU 5XOH E DV UHOHYDQW QRWLFHGWKDWDRQHRIWKHRWKHUVHUYHUV±ZKRKDSSHQHGWREH
LQWHQW VHH +RJDQ Y $PHULFDQ 7HO 7HO )G WK &LU ZKLWH±DSSHDUHGIURPWKHEDFNRIILFHZLWKDEUDQGQHZWLH
WKH GHIHQGDQW ZRXOG EH HQWLWOHG WR D GHWHUPLQDWLRQ XQGHU 5XOH WKDW LWV 7KHVHUYHUFDPHXSWR3ODLQWLIIDQGH[FLWHGO\WROG3ODLQWLII
SUREDWLYH YDOXH VXEVWDQWLDOO\ RXWZHLJKV LWV SUHMXGLFLDO HIIHFW +HUH WKH
PDMRULW\ DGYRFDWHV WKH FRQVLGHUDWLRQ RI VXFK HYLGHQFH ZLWKRXW QRWLFH WR
WKDWVKHKDGMXVWJRWWHQDQHZWLHIURP0DOORQ3ODLQWLIIGLG
WKH GHIHQGDQW DQG HYHQ FULWLFL]HV WKH GLVWULFW FRXUW IRU IDLOLQJ WR FRQVLGHU QRWUHVSRQG KRZHYHUVKHFODLPVWKDWKHUIHHOLQJVZHUHKXUW
WKH HYLGHQFH VXD VSRQWH SDUWLFXODUO\ZKHQVKHUHDOL]HGWKDWVKHFRXOGKDYHPLVVHGD
GD\¶VSD\ZKHQGHVSLWHKLVDVVHUWLRQV0DOORQKDGDQH[WUDWLH
DOODORQJ
1RZKHUH LQ WKH UHFRUG ZDV , DEOH WR ILQG DQ\ LQGLFDWLRQ WKDW DQ\RQH
RWKHU WKDQ WKH SDQHO PDMRULW\ HYHQ UHFRJQL]HG WKLV SRVVLELOLW\ OHW DORQH
GUHZ WKH LQIHUHQFH
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
6KRUWO\DIWHU3ODLQWLIIEHJDQH[SHULHQFLQJWKHVHGLVSDUDJLQJ 'HIHQGDQWLVQRVWUDQJHUWRUDFHGLVFULPLQDWLRQVXLWVDQGWKH
FRPPHQWV DQG LQFLGHQWV ZKDW 'HIHQGDQW UHIHUV WR DV D GLVWULFWFRXUW¶VIDLOXUHWRVHHWKURXJK'HIHQGDQW¶VWDFWLFVDQG
³0\VWHU\6KRSSHU´DUULYHGDWWKH+LJKODQG+HLJKWVIDFLOLW\ UHFRJQL]H WKH PDQ\ JHQXLQH LVVXHV RI PDWHULDO IDFW LV
GXULQJ 3ODLQWLII¶V VKLIW DQG VDW LQ 3ODLQWLII¶V VHFWLRQ IRU GLVWXUELQJ´0DMRULW\2SDW%XW'HQQ\¶VUHFRUGRISDVW
VHUYLFH'HIHQGDQWFODLPVWKDWWKH0\VWHU\6KRSSHU3URJUDP GLVFULPLQDWLRQ²ZKLFK LV QRW DQG FDQQRW EH DW LVVXH
LV DQ H[WHUQDO WRRO XWLOL]HG E\ 'HIHQGDQW WR PRQLWRU WKH KHUH²KDVEHHQPDGHDFHQWUDOLVVXHLQWKHPDMRULW\RSLQLRQ¶V
TXDOLW\RILWVEXVLQHVV7KH0\VWHU\6KRSSHU3URJUDPZDV FULWLFLVPRIWKHGLVWULFWFRXUW
GHYHORSHGDQGSHUIRUPHGE\WKH13'*URXS,QF ³1'3´
ZKLFKLQYROYHGVHQGLQJ³VKRSSHUV´WR'HIHQGDQW¶VYDULRXV 7KHUHLVQRHYLGHQFHZKDWHYHUWKDWWKHGLVWULFWFRXUWKDG
IDFLOLWLHVZKRZRXOGSUHVHQWWKHPVHOYHVDVJXHVWVEXWZHUH DQ\DFWXDONQRZOHGJHRI'HQQ\¶VUHSXWHGLQLTXLWLHVEH\RQG
DFWXDOO\ HYDOXDWLQJ 'HIHQGDQW¶V VHUYLFHV 7KH 0\VWHU\ WKRVH DOOHJHG LQ WKLV ODZVXLW (YHQ LI LW GLG ZKDW , ILQG
6KRSSHUZRXOGFRPSOHWHDIRUPEDVHGRQKLVH[SHULHQFHDW GLVWXUELQJLVWKDWLQUHYLHZLQJWKHGLVWULFWFRXUW¶VGHFLVLRQWKH
WKHIDFLOLW\SURYLGH13'ZLWKWKHUHVXOWVDQG13'LQWXUQ PDMRULW\UHOLHVXSRQRXWVLGHWKHUHFRUGKHDUVD\HYLGHQFHRI
ZRXOGSURYLGHWKHLQIRUPDWLRQWR'HIHQGDQW¶VKHDGTXDUWHUVLQ SULRUEDGDFWVRIWKHGHIHQGDQW7KHHYLGHQFHWKDWWKHGLVWULFW
6SDUWDQEXUJ6RXWK&DUROLQD FRXUWLVSHUPLWWHGWRUHYLHZRQVXPPDU\MXGJPHQWLVFOHDUO\
GHOLQHDWHGE\5XOH
7KHUHVXOWVRIWKH0\VWHU\6KRSSHU¶V5HSRUW ³WKH5HSRUW´
FRQFHUQLQJWKHYLVLWWR+LJKODQG+HLJKWVGXULQJ3ODLQWLII¶V 7KHMXGJPHQWVRXJKWVKDOOEHUHQGHUHGIRUWKZLWKLIWKH
VKLIW LQGLFDWHG DFFRUGLQJ WR 'HIHQGDQW WKDW 3ODLQWLII¶V SOHDGLQJV GHSRVLWLRQ DQVZHUV WR LQWHUURJDWRULHV DQG
³VHUYLFHIHOOVKRUWRIWKHUHTXLUHV>VLF@VWDQGDUGVLQVHYHUDO DGPLVVLRQVRQILOHWRJHWKHUZLWKWKHDIILGDYLWVLIDQ\
DUHDV´ -$DW 7KH5HSRUWZDVSURYLGHGWR5DQGDOO VKRZWKDWWKHUHLVQRJHQXLQHLVVXHDVWRDQ\PDWHULDOIDFW
3RSOLQ 'HIHQGDQW¶V $UHD 0DQDJHU DQG ZDV SRVWHG LQ WKH DQGWKDWWKHPRYLQJSDUW\LVHQWLWOHGWRDMXGJPHQWDVD
HPSOR\HHVHFWLRQRIWKH+LJKODQG+HLJKWVIDFLOLW\DQGERUH PDWWHURIODZ
KDQGZULWWHQFRPPHQWVPDGHE\PDQDJHPHQW
)(' 5 &,9 3 F 7KLVFRXUWPXVWDGKHUHWRWKHVDPH
3RSOLQDYHUVWKDWEHFDXVHKHKDGKHDUGWKDWPDQDJHPHQW VWDQGDUG$IILGDYLWVRIFRXUVHPXVW³EHPDGHRQSHUVRQDO
KDG UHFHLYHG FRPSODLQWV DERXW 3ODLQWLII¶V ZRUN KH NQRZOHGJHVKDOOVHWIRUWKVXFKIDFWVDVZRXOGEHDGPLVVLEOH
FRLQFLGHQWDOO\ DSSHDUHG DW +LJKODQG +HLJKWV WR REVHUYH LQHYLGHQFHDQGVKDOOVKRZDIILUPDWLYHO\WKDWWKHDIILDQWLV
3ODLQWLII DW DERXW WKH VDPH WLPH WKDW WKH 0\VWHU\ 6KRSSHU FRPSHWHQWWRWHVWLI\WRWKHPDWWHUVVWDWHGWKHUHLQ´)(' 5
DSSHDUHG ,Q KLV DIILGDYLW 3RSOLQ VXPPDUL]HG KLV &,9 3 H 7KHPDMRULW\SRLQWVWRQRDXWKRULW\WKDWZRXOG
REVHUYDWLRQVDVIROORZV SHUPLWOHWDORQHUHTXLUHWKHGLVWULFWFRXUWWRWDNHQRWLFHRI
XQUHODWHG ODZVXLWV DQG DUWLFOHV LQ WKH QHZV PHGLD QRW
%DVHGRQP\SHUVRQDOREVHUYDWLRQVLWZDVP\RSLQLRQ
LQ $SULO RI WKDW 0V /RJDQ ZDV QRW PHHWLQJ WKH
OHJLWLPDWHH[SHFWDWLRQVZKLFK,KDGIRUKHUDVD6HUYHU
,QSDUWLFXODU0V/RJDQZDVQRWSHUIRUPLQJKHUMREXS 7KH PDMRULW\¶V FLWDWLRQ WR ,HUDGL Y 0\ODQ /DEV ,QF )G
WRWKH&RPSDQ\VWDQGDUGVLQDQXPEHURIDUHDVLQFOXGLQJ Q G &LU DQG WKH FDVHV FLWHG WKHUHLQ GRHV QRW VXSSRUW WKH
PHHWLQJVHUYLFHVWDQGDUGVGHOLYHULQJIRRGDQGEHYHUDJHV PDMRULW\¶V XVH RI QHZVSDSHU DUWLFOHV WR EULQJ 'HQQ\¶V UDFLDO
GLVFULPLQDWLRQ OLWLJDWLRQ KLVWRU\ WR WKH IRUH LQ WKLV FDVH ,Q HDFK RI WKRVH
ZLWKLQSUHVFULEHGWLPHVDVVLVWLQJRWKHUVDQGSUHEXVVLQJ FDVHV WKH DUWLFOHV RU ERRNV RI ZKLFK WKH DSSHOODWH FRXUW WRRN MXGLFLDO
WDEOHV QRWLFH ZHUH PDWHULDO WR WKH VSHFLILF IDFWXDO DOOHJDWLRQV DQG OHJDO LVVXHV
UDLVHG LQ WKH FDVH LQ ZKLFK WKDW QRWLFH ZDV WDNHQ
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
(YHQPRUHGLVWXUELQJKRZHYHULVWKHPDMRULW\RSLQLRQ¶V -$ DW 3RSOLQ IXUWKHU DYHUV WKDW DV D UHVXOW RI WKH
UHIHUHQFHWRDUWLFOHVIURPWKHQHZVPHGLDDQGWKHSXUSRUWHG DOOHJHG FRPSODLQWV WKDW PDQDJHPHQW KDG UHFHLYHG DERXW
OLWLJDWLRQKLVWRU\RI'HQQ\¶VUHVWDXUDQWVWRLQFUHDVHWKHEXUGHQ 3ODLQWLII¶VSHUIRUPDQFHKLVSHUVRQDOREVHUYDWLRQVRI3ODLQWLII
XSRQGHIHQGDQWVDQGWRFKDQJHWKHVWDQGDUGRIUHYLHZWKDWWKH DV ZHOO DV WKH 0\VWHU\ 6KRSSHU¶V 5HSRUW KH GHFLGHG WKDW
GLVWULFWFRXUWPXVWXVHLQUHYLHZLQJWKHUHFRUGRQVXPPDU\ ³FRUUHFWLYH´ PHDVXUHV QHHGHG WR EH WDNHQ DV WR 3ODLQWLII¶V
MXGJPHQW7KHVWDQGDUGRIUHYLHZIRUVXPPDU\MXGJPHQWLV HPSOR\PHQWDVDVHUYHU
ZHOOVHWWOHG WKHFRXUWPXVWYLHZWKHHYLGHQFHLQWKHUHFRUG
LQ WKH OLJKW PRVW IDYRUDEOH WR WKH QRQPRYLQJ SDUW\ WR 3RSOLQFODLPVWKDW³>E@HFDXVH0V/RJDQZDVDORQJWLPH
GHWHUPLQHZKHWKHUWKHUHLVDJHQXLQHLVVXHRIPDWHULDOIDFW HPSOR\HH>KH@GHFLGHGWKDWWKHPRVWDSSURSULDWHVWHSWRWDNH
UHPDLQLQJIRUWULDO6HH0F.HQ]LHY%HOO6RXWK7HOHFRPP ZRXOGEHWRRIIHUKHUDQRSSRUWXQLW\WRPRYHWHPSRUDULO\LQWR
,QF )G WK&LU ³>7@KHUHPXVWH[LVW D GLIIHUHQW SRVLWLRQ SHUKDSV DV D +RVWHVV RI >VLF@ 6HUYLFH
LQ WKH UHFRUG D JHQXLQH LVVXH RI PDWHULDO IDFW´ FLWLQJ $VVLVWDQW´ -$ DW 3RSOLQ MXVWLILHG KLV GHFLVLRQ DV
$QGHUVRQY/LEHUW\/REE\,QF86 IROORZV
6&W 7KHPDMRULW\RSLQLRQZLWKRXWFLWDWLRQ
WRDQ\DXWKRULW\DGGVDVLJQLILFDQWHOHPHQW %\GRLQJVR0V/RJDQZRXOGEHDEOHWRERWKDFFOLPDWH
KHUVHOIWRWKHIDVWHUSDFHG+LJKODQG+HLJKWVUHVWDXUDQW
:H DUH DOVR WURXEOHG E\ WKH GLVWULFW FRXUW¶V DSSDUHQW DQGOHDUQZD\VWRUDLVHKHUSHUIRUPDQFHWRWKHQHFHVVDU\
FRPSODFHQF\UHJDUGLQJ'HIHQGDQW¶VPLVUHSUHVHQWDWLRQV OHYHO7KHUHDVVLJQPHQWZRXOGQRWKDYHLPSDFWHG0V
DVZHOODVWKHGLVWULFWFRXUW¶VRYHUDOOKDQGOLQJRIWKHFDVH /RJDQ¶V LQFRPH DV VKH ZRXOG KDYH UHFHLYHG D KLJKHU
'HIHQGDQW¶VSDVWKLVWRU\RIGLVFULPLQDWRU\FRQGXFWERWK KRXUO\UDWHWRDFFRXQWIRUWKHORVVRIWKHDELOLW\WRHDUQ
WR LWV PLQRULW\ SDWURQV DQG HPSOR\HHV DOLNH LV ZHOO WLSV
NQRZQ LQ WKH MXULVSUXGHQFH DQG SXEOLF IRUXPV
([DPSOHV RI KLJKO\ SXEOLFL]HG FDVHV LQYROYLQJ ,WZDVP\LQWHQWLRQWRDOORZ0V/RJDQWRUHWXUQWRD
'HIHQGDQW¶VGLVFULPLQDWRU\FRQGXFWLQFOXGH 6HUYHUSRVLWLRQLIVKHLPSURYHGWRWKHSRLQWZKHUHVKH
FRXOGGRVRZLWKRXWFRPSURPLVLQJWKHTXDOLW\RIVHUYLFH
0DMRULW\2SDW WRWKHJXHVWVDWWKH+LJKODQG+HLJKWVUHVWDXUDQW
7KH RSLQLRQ WKHQ FLWHV VHYHUDO FDVHV LQ ZKLFK 'HQQ\¶V -$ DW 3RSOLQ FODLPV WKDW KH WKHQ SUHSDUHG DQ
SXUSRUWHGO\HQWHUHGLQWRFRQVHQWGHFUHHVWRVHWWOHFODLPVRI (PSOR\HH3HUIRUPDQFH5HFRUG ³(35´ ³LQRUGHUWRSURYLGH
UDFLDO GLVFULPLQDWLRQ WKH RSLQLRQ DOVR FLWHV DQG GLVFXVVHV 0V /RJDQ ZLWK ZULWWHQ QRWLFH RI WKH RSWLRQV ZKLFK ZHUH
QHZV DUWLFOHV ZLWK UHJDUG WR GLVFULPLQDWLRQ FODLPV PDGH EHLQJSURYLGHGWRKHU´3RSOLQDOVRFODLPVWKDWEHFDXVHKH
DJDLQVW'HQQ\¶V7KHRSLQLRQFRQFOXGHVWKLVGLVFXVVLRQWKXV ZDVXQDEOHWRPHHWZLWK3ODLQWLIIDWWKHUHVWDXUDQWGXULQJKHU
³$OWKRXJK ZH UHFRJQL]H WKDW 'HIHQGDQW¶V SDVW UHFRUG RI QH[W VFKHGXOHG VKLIW KH GHOLYHUHG WKH (35 WR RQH RI WKH
GLVFULPLQDWLRQ LV QRW DW LVVXH KHUH WKH IDFW UHPDLQV WKDW PDQDJHUVDW+LJKODQG+HLJKWV³ZLWKLQVWUXFWLRQVWRLVVXHWKH
(35 WR 0V /RJDQ ZKHQ VKH UHSRUWHG WR ZRUN 7KH (35
SUHSDUHGVWDWHGWKDWLWZDVEHLQJLVVXHGGXHWRVHUYLFHUHODWHG
SHUIRUPDQFHLVVXHVDQGWKDW0V/RJDQZDVEHLQJJLYHQWKH
, GR QRW TXHVWLRQ WKDW 'HQQ\¶V KDV D KLVWRU\ RI UDFLDOGLVFULPLQDWLRQ
RSWLRQRIPRYLQJLQWRHLWKHUD+RVWHVVRUD6HUYLFH$VVLVWDQW
OLWLJDWLRQ %XW DQ\ HYLGHQFH RI WKDW OLWLJDWLRQ ZDV QHLWKHU EHIRUH WKH
GLVWULFW FRXUW LQ WKH UHFRUG RQ VXPPDU\ MXGJPHQW QRU UHOHYDQW WR WKHVH
SRVLWLRQ´ -$DW
SURFHHGLQJV , XVH WKH ZRUG ³SXUSRUWHG´ WR XQGHUVFRUH WKH LPSURSULHW\ RI
WKH PDMRULW\¶V YHQWXULQJ RXWVLGH WKH UHFRUG LQ WKLV FDVH
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
,QKHUDIILGDYLW0DU\-DQHGHOD9HJDWKHPDQDJHUWRZKRP :LWKDOOGXHUHVSHFWWRP\SDQHOFROOHDJXHVYLHZLQJWKH
3RSOLQDVVLJQHGWKHWDVNRIUHYLHZLQJWKH(35ZLWK3ODLQWLII HYLGHQFHLQWKHOLJKWPRVWIDYRUDEOHWR/RJDQGRHVQRWSHUPLW
SURYLGHGDQDFFRXQWRIKHUPHHWLQJZLWK3ODLQWLIIGHOD9HJD¶V XVDVDUHYLHZLQJFRXUWWRWDNHMXGLFLDOQRWLFHRIIDFWVRIWKH
DIILGDYLWLVFRQVLGHUDEO\VKRUWHUWKDQ3RSOLQ¶VDIILGDYLWDQG W\SHQRWLFHGE\WKHPDMRULW\7KHPDMRULW\RSLQLRQVD\VWKDW
SURYLGHVLQUHOHYDQWSDUW ³ZH FDQ WDNH MXGLFLDO QRWLFH WKDW D EXVER\ RU µVHUYLFH
DVVLVWDQW¶DV'HIHQGDQWHQWLWOHVLWLVDMREFODVVLILFDWLRQEHORZ
7KH(35SUHSDUHGE\0U3RSOLQVWDWHGWKDWLWZDV WKDW RI D ZDLWHU RU VHUYHU SDUWLFXODUO\ DW WKLV W\SH RI
EHLQJLVVXHGGXHWRVHUYLFHUHODWHGSHUIRUPDQFHLVVXHV UHVWDXUDQW´ ,Q P\ YLHZ WKH H[DFW VWDWXV RI D ³VHUYLFH
DQG WKDW 0V /RJDQ ZDV EHLQJ JLYHQ WKH RSWLRQ RI DVVLVWDQW´RU³EXVER\´DWWKLVSDUWLFXODU'HQQ\¶VUHVWDXUDQWRU
PRYLQJLQWRD+RVWHVVRUD6HUYLFH$VVLVWDQWSRVLWLRQ DQ\ZKHUHHOVHLVQRWWKHNLQGRIDGMXGLFDWLYHIDFWRIZKLFK
MXGLFLDO QRWLFH FDQ EH WDNHQ E\ WKLV FRXUW XQGHU WKH
:KHQ 0V /RJDQ DUULYHG DW ZRUN RQ $SULO UHTXLUHPHQWVRIWKH)HGHUDO5XOHVRI(YLGHQFH $OWKRXJK
,PHWSULYDWHO\ZLWKKHULQWKHRIILFHLQWKHEDFNRI WKH 5XOHV RI (YLGHQFH GR SURYLGH WKDW XQGHU DSSURSULDWH
WKH5HVWDXUDQWLQRUGHUWRSUHVHQWWKH(35WRKHU FLUFXPVWDQFHVMXGLFLDOQRWLFHPD\EHWDNHQDWDQ\VWDJHRIWKH
SURFHHGLQJV FRXUWV RI DSSHDOV DUH QRW LQ WKH EXVLQHVV RI
,SUHVHQWHGWKH(35WR0V/RJDQDQGJDYHKHUWKH ILQGLQJGLVSXWHGIDFWVDWDOODQGFHUWDLQO\WKHPDMRULW\¶VXVH
RSSRUWXQLW\WRUHDGLWDQGVLJQLW0V/RJDQUHDGWKH RIMXGLFLDOQRWLFHLJQRUHVWKHUHTXLUHPHQWWKDWWKHSDUWLHVKDYH
(35DQGWKHQOHIWZLWKRXWVLJQLQJLW WKH RSSRUWXQLW\ WR EH KHDUG ZLWK UHJDUG WR LW 6HH 5RVH Y
+DUWIRUG8QGHUZULWHUV,QV&R)G WK&LU
-$DW ³5XOH H UHTXLUHVWKHGLVWULFWFRXUWWRJLYHDSDUW\
3ODLQWLII SURYLGHV D PXFK GLIIHUHQW DFFRXQW RI ZKDW DQ RSSRUWXQLW\ WR EH KHDUG LI MXGLFLDO QRWLFH LV WDNHQ´
KDSSHQHGRQ$SULO 6SHFLILFDOO\3ODLQWLIIUHFRXQWHG 6LJQLILFDQWO\ZKHWKHUE\UHPRYLQJ/RJDQIURPKHUSRVLWLRQ
LQKHUGHSRVLWLRQWKDWRQWKHGD\LQTXHVWLRQVKHUHSRUWHGIRU DVDVHUYHUDQGRIIHULQJKHUDQRWKHUSRVLWLRQ'HQQ\¶VGHPRWHG
ZRUNDQGFKHFNHGWKHVFKHGXOHWRDVFHUWDLQZKLFKVWDWLRQRI KHULVFULWLFDOWRWKHGHWHUPLQDWLRQRIWKHFODLPRIFRQVWUXFWLYH
WKH UHVWDXUDQW VKH KDG EHHQ DVVLJQHG WR ZRUN 3ODLQWLII GLVFKDUJH
QRWLFHGWKDWWKHVFKHGXOHUHDGWKDWVKHKDGEHHQDVVLJQHGWR
³VWDWLRQ HLJKW ´ KRZHYHU 3ODLQWLII ZDV FRQIXVHG E\ WKLV
DVVLJQPHQWEHFDXVHWRWKHEHVWRIKHUNQRZOHGJHWKHUHZDV
QR VWDWLRQ HLJKW DW WKH UHVWDXUDQW %HFDXVH RI WKLV RGG
7KH WDNLQJ RI MXGLFLDO QRWLFH LV JRYHUQHG E\ 5XOH RI WKH )HGHUDO
DVVLJQPHQW3ODLQWLIIZHQWWRWKHPDQDJHU¶VRIILFH±GHOD9HJD 5XOHV RI (YLGHQFH DQG SURYLGHV LQ SHUWLQHQW SDUW
ZDVRQGXW\DWWKHWLPH 3ODLQWLIINQRFNHGRQWKHGRRUDQG
VKHVDLGWRGHOD9HJD³0DU\-HDQKHOSPHRXWKHUH E .LQGV RI IDFWV $ MXGLFLDOO\ QRWLFHG IDFW PXVW EH RQH QRW
ZKHUHLVVWDWLRQHLJKW´ -$DW $FFRUGLQJWR3ODLQWLII VXEMHFW WR UHDVRQDEOH GLVSXWH LQ WKDW LW LV HLWKHU JHQHUDOO\
NQRZQ ZLWKLQ WKH WHUULWRULDO MXULVGLFWLRQ RI WKH WULDO FRXUW RU
GHOD9HJDMXVWVKRRNKHUKHDGDQGWROG3ODLQWLIIWRFRPHLQWR FDSDEOH RI DFFXUDWH DQG UHDG\ GHWHUPLQDWLRQ E\ UHVRUW WR
WKHRIILFHEHFDXVHVKHQHHGHGWRWDONWR3ODLQWLII3ODLQWLIIGLG VRXUFHV ZKRVH DFFXUDF\ FDQQRW UHDVRQDEO\ EH TXHVWLRQHG
DVGHOD9HJDUHTXHVWHGDQGFORVHGWKHGRRUEHKLQGKHU
H 2SSRUWXQLW\ WR EH KHDUG $ SDUW\ LV HQWLWOHG XSRQ WLPHO\
GHOD9HJDWKHQSURFHHGHGWRDVN3ODLQWLIILIVKHKDGVHHQWKH UHTXHVW WR DQ RSSRUWXQLW\ WR EH KHDUG DV WR WKH SURSULHW\ RI WDNLQJ
5HSRUW IURP WKH 0\VWHU\ 6KRSSHU RQ WKH ERDUG WR ZKLFK MXGLFLDO QRWLFH DQG WKH WHQRU RI WKH PDWWHU QRWLFHG ,Q WKH
DEVHQFH RI SULRU QRWLILFDWLRQ WKH UHTXHVW PD\ EH PDGH DIWHU
3ODLQWLIIUHSOLHGWKDWRIFRXUVHVKHKDGVHHQLW³\RXFDQ¶WPLVV MXGLFLDO QRWLFH KDV EHHQ WDNHQ
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
P\ YLHZ KDV QR VXSSRUW LQ WKH HVWDEOLVKHG ODZ 6HH LW´ -$DW $WWKDWSRLQWGHOD9HJDORRNHGDW3ODLQWLII
7KXUVWRQ0RWRU/LQHV,QFY-RUGDQ.5DQG/WG86 VKRRNKHUKHDGDQGVDLG³,MXVWZDQW\RXWRNQRZWKLVLVDOO
6&W ³1HHGOHVVWRVD\ 5DQG\¶V >3RSOLQ¶V@GRLQJV´ -$DW GHOD9HJDWKHQ
RQO\WKLV&RXUWPD\RYHUUXOHRQHRILWVSUHFHGHQWV8QWLOWKDW KDQGHG 3ODLQWLII D RQHSDJH GRFXPHQW ZKLFK 3ODLQWLII
RFFXUV >RXU SULRU SUHFHGHQW@ LV WKH ODZ DQG WKH GHFLVLRQ UHIHUUHGWRDVD³FRQILUPDWLRQFRQILUPHU´ WKH(35DV3RSOLQ
EHORZFDQQRWEHUHFRQFLOHGZLWKLW´ UHIHUV WR LW ZKLFK DFFRUGLQJ WR 3ODLQWLII VWDWHG WKDW D
0\VWHU\ 6KRSSHU KDG FRPH LQWR WKH UHVWDXUDQW DQG ZDV
7KH PDMRULW\ GHIHQGV LWV ILQGLQJ RI IDFWV RQ DSSHDO DV GLVSOHDVHGZLWKWKHVHUYLFHWKDW3ODLQWLIISURYLGHGEHFDXVHWKH
PHUHO\EULQJLQJ³WRWKHIRUH´HYLGHQFHWKDW/RJDQDGGXFHG VKRSSHU ZDLWHG WRR ORQJ WR EH VHUYHG ZDV QRW DVNHG LI KH
DQG VD\V WKDW WKLV FRPSRUWV ZLWK YHQHUDEOH SUHFHGHQW ZRXOG OLNH D UHILOO RQ KLV EHYHUDJH DQG ZDV QRW DVNHG WR
FRQFHUQLQJVXPPDU\MXGJPHQWUHYLHZ³%ULQJLQJHYLGHQFH UHWXUQIRUDQRWKHUYLVLW3ODLQWLIIFODLPVWKDWWKHGRFXPHQW
WRWKHIRUH´DPRXQWVWRPRUHWKDQYLHZLQJWKHHYLGHQFHLQD DGGHG WKDW EHFDXVH RI WKH 5HSRUW LI 3ODLQWLII ZLVKHG WR
OLJKWPRVWIDYRUDEOHWRWKHQRQPRYDQWDQGWKHPDMRULW\KDV FRQWLQXH KHU HPSOR\PHQW ZLWK 'HIHQGDQW KHU MRE
JRQHEH\RQGHYHQWKDWE\SURYLGLQJDQLQWHUSUHWDWLRQRIWKDW FODVVLILFDWLRQZDVEHLQJFKDQJHGWR³VHUYLFHDVVLVWDQW´ZKLFK
HYLGHQFHZKLFK/RJDQKDVQHLWKHUSURYLGHGQRUVXJJHVWHG LV'HIHQGDQW¶VWHUPLQRORJ\IRUZKDWLVFRPPRQO\NQRZQDV
7KHPDMRULW\KDVFRXFKHGWKRVHLQWHUSUHWDWLRQVLQWHUPVRI DEXVER\
WKDWZRXOGDSSHDUWRWKHDYHUDJHUHDGHUDVPDNLQJILQGLQJVRI
IDFW 3ODLQWLII FODLPV WKDW DIWHU UHDGLQJ WKH GRFXPHQW WKH
IROORZLQJHYHQWVWUDQVSLUHG
6R,ORRNHGDWKHUDQG,VDLG³0DU\-HDQ´,VDLG³\RX
NQRZWKLVLVQRWHYHQFRUUHFWWKLVLVQ¶WWUXHWKHVHDUH
7R FRPSDUH WKH SUHVHQWDWLRQ RI IDFWV LQ 'HQQ\¶V EULHI WR WKH IDFWV LQ OLHV´,VDLG³WKLVGLGQ¶WKDSSHQ´,VDLG³QRRQHFRPHV
&XQQLQJKDP Y 6HDUV 5RHEXFN DQG &R )G WK &LU WKH LQWRWKLVVWRUHDQGZDLWVPLQXWHV$VKXQJU\DVWKHVH
FDVH WKH PDMRULW\ FLWHV WR VXSSRUW LWV ILQGLQJ RI ³GHOLEHUDWH
PLVUHSUHVHQWDWLRQ´ LV WR FRPSRXQG WKH HUURU &XQQLQJKDP ZDV D FDVH LQ
VHUYHUVDUHIRUWLSV\RXFDQ¶WHYHQJHWDSHUVRQWRZDON
ZKLFK WKH SODLQWLII GXULQJ WKH FRXUVH RI WULDO OHDUQHG WKDW D MXURU KDG
LQ DQG ZDLW IRU VHFRQGV \HW DORQH PLQXWHV IRU
IDOVHO\ WHVWLILHG GXULQJ YRLU GLUH 1RW XQWLO DIWHU WKH MXU\ UHWXUQHG LWV FRIIHH´ $QG VKH FRXOGQ¶W VD\ DQ\WKLQJ $QG , VDLG
YHUGLFW² ZKLFK ZDV DGYHUVH WR WKH SODLQWLII² GLG WKH SODLQWLII RU KLV ³ZHOO´,VDLG³,GRQ¶WNQRZZKDWWRVD\´6R,WXUQHG
FRXQVHO DGYLVH WKH WULDO FRXUW RI WKLV IDFW 7KH WULDO FRXUW GHQLHG SODLQWLII¶V DURXQGWRZDONRXWDQGVKHVDLG³ZHOO,QHHG\RXWRVLJQ
PRWLRQ IRU D QHZ WULDO EDVHG RQ WKH MXURU¶V IDOVH WHVWLPRQ\ DQG WKH
SODLQWLII DSSHDOHG ,Q WKH SODLQWLII¶V DSSHOODWH EULHI FRXQVHO PDGH QR
WKLV´DQG,>VLF@VDLG³VLJQLW´,VDLG³,FDQ¶WVLJQWKLV
PHQWLRQ RI KLV FOLHQW¶V NQRZOHGJH GXULQJ WKH WULDO WKDW WKH MXURU¶V
WHVWLPRQ\ ZDV IDOVH GLG QRW LQFOXGH LQ WKH MRLQW DSSHQGL[ WKH WULDO FRXUW¶V
ILQGLQJV RQ WKH PDWWHU DQG VWDWHG RQO\ WKDW ³>Z@LWKLQ VHYHUDO GD\V DIWHU WKH
FRQFOXVLRQ RI WKH VHFRQG WULDO RI WKLV DFWLRQ LW ZDV OHDUQHG WKDW D MXURU
KDG IDLOHG WR FRPSOHWHO\ DQG FRUUHFWO\ DQVZHU D TXHVWLRQ SRVHG E\ WKH GHOD9HJD FODULILHG LQ KHU GHSRVLWLRQ WHVWLPRQ\ WKDW ³FRQYHUVDWLRQ
&RXUW GXULQJ WKH YRLU GLUH´ ,G DW HPSKDVLV RPLWWHG 7KLV FRXUW FRQILUPHUV´ DV WKDW WHUP LV XVHG E\ 'HIHQGDQW LV DERXW WKH VDPH WKLQJ DV
IRXQG FRXQVHO¶V UHQGLWLRQ D ³VHULRXV PLVUHSUHVHQWDWLRQ RI WKH IDFWV´ ,G DQ (35 H[FHSW WKDW WKH IRUPHU LV XVHG IRU FRDFKLQJ ZKLOH WKH ODWWHU LV
7KDW LV D IDU FU\ IURP WKH FRQGXFW RI FRXQVHO KHUH XVHG IRU GLVFLSOLQH -$ DW
6HH DOVR 5RELQVRQ Y &HQWUDO %UDVV 0IJ &R )G GHOD9HJD FRQILUPHG LQ KHU GHSRVLWLRQ WHVWLPRQ\ WKDW 'HIHQGDQW XVHV
Q WK &LU ³0RUH LPSRUWDQW ZH KDYH QR DXWKRULW\ WR RYHUUXOH WKH WKH WLWOH ³VHUYLFH DVVLVWDQW´ IRU ZKDW LV FRPPRQO\ NQRZQ DV ³D EXVER\
6XSUHPH &RXUW´ EXV JLUO´ -$ DW
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
WKLVLVQ¶WHYHQWUXH´6R,ZDONHGRXWDQGFORFNHGRXW SUHVHQWLQJLQLWVEULHIDOLVWRIWKHSODLQWLII¶VVKRUWFRPLQJVDV
ZKLFKLVDERXWTXDUWHUDIWHUHLJKWDQGZHQWKRPH WKH\ DUH UHIOHFWHG LQ KHU SHUIRUPDQFH UHYLHZV $QG , ILQG
VXUSULVLQJWKHPDMRULW\RSLQLRQ¶VVWDWHPHQWWKDW³>U@HYLHZLQJ
-$DW 'HIHQGDQW¶VEULHIOHDGVRQHWRFRQFOXGHWKDW3ODLQWLII¶VRYHUDOO
SHUIRUPDQFHDVDVHUYHUKDVEHHQSRRUVLQFHVKHEHJDQKHU
$IWHUIXUWKHUTXHVWLRQLQJ IURPGHIHQVHFRXQVHO3ODLQWLII HPSOR\PHQWZLWK'HIHQGDQW´7KHWDEOHLQWKDWEULHIWKDWWKH
DGGHGWKDWVKHDVNHGGHOD9HJDLIWKHUHZHUHDQ\RWKHURSWLRQV PDMRULW\ ILQGV GHOLEHUDWHO\ PLVOHDGLQJ LV SUHIDFHG E\ WKHVH
WR KHU UHPDLQLQJ HPSOR\HG ZLWK WKH FRPSDQ\ RWKHU WKDQ ZRUGV
EHFRPLQJDEXVER\WRZKLFKGHOD9HJDDOOHJHGO\UHVSRQGHG
WKDW ³WKLV LV 5DQG\¶V GRLQJ WKLV LV WKH RSWLRQ ULJKW KHUH´ 3ODLQWLII¶VSHUIRUPDQFHZDVFRQVLVWHQWO\EHORZ&RPSDQ\
3ODLQWLIIFODLPVWKDWVKHSURIHVVHGWRGHOD9HJDWKDWDIWHUEHLQJ VWDQGDUGV LQ D QXPEHU RI DUHDV ,Q DFFRUGDQFH ZLWK
D VHUYHU IRU HOHYHQ \HDUV VKH GLG QRW ZDQW WR ZHDU UXEEHU &RPSDQ\SURFHGXUHV3ODLQWLII¶VVXSHUYLVRUVSHUIRUPHG
ERRWV DQG EH D EXVER\ SDUWLFXODUO\ ZKHQ WKH MRE HQWDLOHG SHULRGLFSHUIRUPDQFHHYDOXDWLRQVWRDGYLVHKHURIWKHVH
OLIWLQJGLVKHVWKHFKDQJHZDVGHJUDGLQJDQGWKHUHZHUHQR SUREOHPV DQG UHFRPPHQG DSSURSULDWH FRUUHFWLYH
RWKHU IHPDOH EXVER\V 3ODLQWLII DOVR FODLPV WR KDYH DVNHG PHDVXUHV7KHIROORZLQJLVDVDPSOHRIWKHSHUIRUPDQFH
GHOD9HJDLIVKHFRXOGJRWKURXJKVRPHWUDLQLQJIRUKHUVHUYHU SUREOHPVEURXJKWWR3ODLQWLII¶VDWWHQWLRQWKURXJKWKHVH
SRVLWLRQLI'HIHQGDQWIRXQGKHUSHUIRUPDQFHODFNLQJRULIVKH SHUIRUPDQFHUHYLHZV
FRXOGWUDLQWREHFRPHDKRVWHVVWRZKLFKGHOD9HJDUHLWHUDWHG
WKDW WKH RQO\ RSWLRQ ZDV ZKDW ZDV EHIRUH 3ODLQWLII ± WKH HPSKDVLVDGGHG
VHUYLFHDVVLVWDQWSRVLWLRQ3ODLQWLIIVWDWHGWKDWLIGHOD9HJDKDG
RIIHUHGKHUDKRVWHVVSRVLWLRQVKHZRXOGKDYHDFFHSWHGWKH 6LPLODUO\ WKH PDMRULW\ UHSULPDQGV 'HQQ\¶V FRXQVHO IRU
RIIHU PLVUHSUHVHQWLQJ WKH UHFRUG ZLWK UHJDUG WR WKH LQIRUPDWLRQ
JLYHQ WR /RJDQ DERXW WUDQVIHUULQJ WR WKH +LJKODQG +HLJKWV
3ODLQWLIIGLGQRWUHWXUQWRZRUNDW+LJKODQG+HLJKWVDQG ORFDWLRQVWDWLQJWKDWWKHWHVWLPRQ\SRLQWHGWRLQ'HQQ\¶VEULHI
WHUPLQDWHGKHUHPSOR\PHQWZLWK'HIHQGDQWDIWHUWKH$SULO ³LQ QR ZD\ VXSSRUWV´ 'HQQ\¶V FRQWHQWLRQ WKDW /RJDQ ZDV
LQFLGHQW+DYLQJUHFHLYHGDULJKWWRVXHOHWWHUIURPWKH(TXDO ³ZDUQHG´ DERXW WKH FRQGLWLRQV DW +LJKODQG +HLJKWV
(PSOR\PHQW2SSRUWXQLW\&RPPLVVLRQ ³((2&´ 3ODLQWLII 6LJQLILFDQWO\WKHPDMRULW\RSLQLRQGRHVQRWGLVSXWHDQ\RIWKH
ILOHGWKHSUHVHQWODZVXLW VSHFLILFLQIRUPDWLRQWRZKLFK'HQQ\¶VEULHIUHIHUV UDWKHUWKH
PDMRULW\UHVWVLWVFULWLFLVPHQWLUHO\RQWKHIDFWWKDW'HQQ\¶V
',6&866,21 EULHIVD\VWKDW/RJDQZDV³ZDUQHG´DERXWWKHVHFRQGLWLRQV
ZKHQWKHPDMRULW\EHOLHYHVWKDWLQIDFW/RJDQZDVPHUHO\
:HUHYLHZDJUDQWRIVXPPDU\MXGJPHQWGHQRYR'H3LHUR ³DGYLVHG´DERXWWKHP%XWZKHWKHU/RJDQZDVZDUQHG RU
Y &LW\ RI 0DFHGRQLD )G WK &LU DGYLVHGWKHUHFRUGGRHVUHIOHFWWKDW/RJDQZDVWROGWKDWVKH
6XPPDU\ MXGJPHQW LV DSSURSULDWH ZKHUH ³WKH SOHDGLQJV ZRXOG ILQG WKH ZRUNLQJ FRQGLWLRQV DW +LJKODQG +HLJKWV
GHSRVLWLRQV DQVZHUV WR LQWHUURJDWRULHV DQG DGPLVVLRQV RQ GLIIHUHQW IURP WKRVH DW 5DQGDOO 7KLV UHTXLUHPHQW WKDW
ILOHWRJHWKHUZLWKWKHDIILGDYLWVLIDQ\VKRZWKDWWKHUHLVQR 'HQQ\¶V SUHVHQW WKH HYLGHQFH VXSSRUWLQJ LWV PRWLRQ IRU
JHQXLQHLVVXHDVWRDQ\PDWHULDOIDFWDQGWKDWWKHPRYLQJSDUW\ VXPPDU\MXGJPHQWLQWKHOLJKWPRVWIDYRUDEOHWR/RJDQLQ
LVHQWLWOHGWRDMXGJPHQWDVDPDWWHURIODZ´)(' 5 &,9 3
F $V WKH SDUW\ PRYLQJ IRU VXPPDU\ MXGJPHQW
'HIHQGDQWV EHDU WKH EXUGHQ RI VKRZLQJ WKH DEVHQFH RI D
JHQXLQH LVVXH RI PDWHULDO IDFW DV WR DW OHDVW RQH HVVHQWLDO
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
GLVFKDUJH DUH LQDGPLVVLEOH LQ WKHLU HQWLUHWLHV EHFDXVH WKH HOHPHQWRI3ODLQWLII¶VFODLP6HH&HORWH[&RUSY&DWUHWW
(PSOR\PHQW 3HUIRUPDQFH 5HSRUW ³(35´ SUHSDUHG ZLWK 86 2QFH'HIHQGDQWPHHWVLWVEXUGHQ
UHJDUGWR/RJDQDQGUHIHUUHGWRLQWKRVHDIILGDYLWVZDVQRW RI SURGXFWLRQ 3ODLQWLII DV WKH QRQPRYLQJ SDUW\ PXVW E\
SURGXFHG7KLVUHSRUWZDVFHQWUDOWR'HQQ\¶VDUWLFXODWHGQRQ GHSRVLWLRQDQVZHUVWRLQWHUURJDWRULHVDQGDGPLVVLRQVRQILOH
GLVFULPLQDWRU\UHDVRQIRUUHPRYLQJ/RJDQIURPKHUSRVLWLRQ VKRZVSHFLILFIDFWVWKDWUHYHDODJHQXLQHLVVXHIRUWULDO,G
DVDZDLWUHVV7KHUHFRUGGRHVQRWUHIOHFWQRUGRHV/RJDQ :H PXVW DFFHSW 3ODLQWLII¶V HYLGHQFH DV WUXH DQG GUDZ DOO
FODLPWKDWVKHUDLVHGDQ\REMHFWLRQWRWKDWWHVWLPRQ\EHIRUH UHDVRQDEOHLQIHUHQFHVLQKHUIDYRUVHH$QGHUVRQY/LEHUW\
WKHWULDOFRXUWHLWKHURQWKHJURXQGWKDWWKH(35KDGQRWEHHQ /REE\,QF86 YLHZLQJDOOIDFWVDQG
SURGXFHG RU RQ DQ\ RWKHU JURXQG 1HLWKHU GLG VKH ILOH D LQIHUHQFHV GUDZQ WKHUHIURP LQ WKH OLJKW PRVW IDYRUDEOH WR
PRWLRQEHIRUHWKHWULDOFRXUWSXUVXDQWWR5XOH I DVNLQJIRU 3ODLQWLII 'H3LHUR )G DW 7KLV &RXUW OLNH WKH
DGGLWLRQDOGLVFRYHU\EHIRUHWKHFRXUWUXOHGRQWKHPRWLRQIRU GLVWULFWFRXUWPD\QRWPDNHFUHGLELOLW\GHWHUPLQDWLRQVQRU
VXPPDU\ MXGJPHQW 7KH PDMRULW\ RSLQLRQ FLWHV DV LWV ZHLJKWKHHYLGHQFHEHIRUHLWZKHQGHWHUPLQLQJZKHWKHUDQ
DXWKRULW\IRUGLVUHJDUGLQJWKHVHDIILGDYLWV0RRUHY+ROEURRN LVVXHRIIDFWUHPDLQVIRUWULDO6HH$KOHUVY6FKHELO)G
)G WK &LU %XW 0RRUH KHOG WKDW WK&LU FLWLQJ$QGHUVRQ86DW
DOWKRXJK WKH HYLGHQFH ZDV QRW DGPLVVLEOH EHFDXVH WKH
VXSSRUWLQJGRFXPHQWVKDGQRWEHHQVXEPLWWHGQRREMHFWLRQ 3ODLQWLIIILOHGVXLWXQGHUVHFWLRQH D RI7LWOH9,,
WRLWVDGPLVVLELOLW\KDGEHHQUDLVHGEHIRUHWKHWULDOFRXUWDQG ZKLFKSURYLGHVLQUHOHYDQWSDUW
WKHLVVXHZDVWKHUHIRUHQRWUHYLHZDEOH,G0RRUHQRWRQO\
GRHV QRW VXSSRUW WKH PDMRULW\¶V VXD VSRQWH DFWLRQ KHUH LW ,W VKDOO EH DQ XQODZIXO HPSOR\PHQW SUDFWLFH IRU DQ
VXSSRUWVDFRQWUDU\YLHZ HPSOR\HU±
7KHUHLVQRTXHVWLRQWKDWLQUHYLHZLQJDJUDQWRIVXPPDU\ WR IDLO RU UHIXVH WR KLUH RU WR GLVFKDUJH DQ\
MXGJPHQW ZH PXVW YLHZ WKH HYLGHQFH LQ WKH OLJKW PRVW LQGLYLGXDO RU RWKHUZLVH WR GLVFULPLQDWH DJDLQVW DQ\
IDYRUDEOH WR WKH QRQPRYLQJ SDUW\ 7KH ODZ GRHV QRW LQGLYLGXDO ZLWK UHVSHFW WR KLV FRPSHQVDWLRQ WHUPV
KRZHYHUUHTXLUHWKHPRYLQJSDUW\WRSUHVHQWLWVHYLGHQFHLQ FRQGLWLRQVRUSULYLOHJHVRIHPSOR\PHQWEHFDXVHRIVXFK
WKH OLJKW PRVW IDYRUDEOH WR WKH QRQPRYLQJ SDUW\ 7KH LQGLYLGXDO¶VUDFHFRORUUHOLJLRQVH[RUQDWLRQDORULJLQ
PDMRULW\ RSLQLRQ SRLQWV WR QR DXWKRULW\ IRU LWV YLHZ WKDW
FRXQVHO IRU 'HQQ\¶V KDV DFWHG ³XQFRQVFLRQDEO>\@´ E\
86&H D $SODLQWLIIPD\HVWDEOLVKDFODLP
RI GLVFULPLQDWLRQ HLWKHU E\ LQWURGXFLQJ GLUHFW HYLGHQFH RI
GLVFULPLQDWLRQRUE\SURYLQJFLUFXPVWDQWLDOHYLGHQFHZKLFK
7KH PDMRULW\¶V FLWDWLRQ WR 7DIW %URDGFDVWLQJ &RPSDQ\ Y 8QLWHG ZRXOGVXSSRUWDQLQIHUHQFHRIGLVFULPLQDWLRQ6HH.OLQHY
6WDWHV )G WK &LU WR EROVWHU LWV SRVLWLRQ H[DFHUEDWHV WKH 7HQQ9DOOH\$XWK)G WK&LU ³7KH
HUURU 7DIW GLG QRW DGGUHVV DQ DSSHOODQW¶V UDLVLQJ DQ LVVXH IRU WKH ILUVW WLPH
RQ DSSHDO LQ WKH UHSO\ EULHI ZKLFK LV WKH ODVW ZRUG LQ DSSHOODWH EULHILQJ
GLUHFW HYLGHQFH DQG WKH FLUFXPVWDQWLDO HYLGHQFH SDWKV DUH
DQG 7DIW PDGH YHU\ FOHDU WKDW RXU IRUJLYLQJ ZKDW LV RUGLQDULO\ D ZDLYHU LV PXWXDOO\ H[FOXVLYH D SODLQWLII QHHG RQO\ SURYH RQH RU WKH
WKH H[FHSWLRQ QRW WKH UXOH :H LQYRNH WKDW H[FHSWLRQ WR ³µSUHYHQW RWKHUQRWERWK´,G
PDQLIHVW LQMXVWLFH DQG WR SURPRWH SURFHGXUDO HIILFLHQF\¶´ 7DIW )G
DW TXRWLQJ 8QLWHG 6WDWHV Y %DNHU )G WK &LU 8QGHUWKHFLUFXPVWDQWLDOHYLGHQFHDSSURDFK±WKHDSSURDFK
DQG RQO\ ZKHQ GRLQJ VR ³VHUYHV DQ RYHUDUFKLQJ SXUSRVH EH\RQG
XVHGLQWKHPDWWHUDWKDQG±WKHWKUHHSDUWWHVWRI0F'RQQHOO
WKDW RI DUULYLQJ DW WKH FRUUHFW UHVXOW LQ DQ LQGLYLGXDO FDVH´ )RVWHU Y
%DULORZ )G WK &LU 7KH PDMRULW\¶V LQYRNLQJ WKDW
'RXJODV LV HPSOR\HG 6HH 0F'RQQHOO 'RXJODV &RUS Y
H[FHSWLRQ KHUH GRHV QRW SDVV PXVWHU XQGHU HLWKHU 7DIW RU )RVWHU *UHHQ86 DVODWHUFODULILHGE\7H['HS¶W
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
RI &RPW\ $IIDLUV Y %XUGLQH 86 7KLV SDUW\ %HFDXVH WKH GLVWULFW FRXUW PD\ JUDQW VXPPDU\
SDUDGLJPILUVWUHTXLUHV3ODLQWLIIWRHVWDEOLVKDSULPDIDFLHFDVH MXGJPHQWRQO\LILWLVFOHDUWKDWRQWKHXQGLVSXWHGIDFWVRURQ
RIGLVFULPLQDWLRQ6HH0F'RQQHOO'RXJODV86DW WKHIDFWVYLHZHGLQWKHOLJKWPRVWIDYRUDEOHWRWKHQRQPRYLQJ
7RHVWDEOLVKDSULPDIDFLHFDVHRIGLVFULPLQDWLRQXQGHU7LWOH SDUW\WKHPRYLQJSDUW\LVHQWLWOHGWRMXGJPHQWWKHGLVWULFW
9,, 3ODLQWLII PXVW VKRZ WKDW VKH LV D PHPEHU RI D FRXUW PD\ QRW ZHLJK WKH HYLGHQFH RU PDNH FUHGLELOLW\
SURWHFWHG FODVV VKH ZDV TXDOLILHG IRU WKH MRE DQG GHWHUPLQDWLRQV RUPDNHDQ\ILQGLQJVRIIDFWLQUXOLQJRQD
SHUIRUPHGLWVDWLVIDFWRULO\ GHVSLWHKHUTXDOLILFDWLRQVDQG PRWLRQIRUVXPPDU\MXGJPHQW$QGWKLVFRXUWPD\QRWGRVR
SHUIRUPDQFHVKHVXIIHUHGDQDGYHUVHHPSOR\PHQWDFWLRQ DQG HLWKHU
VKHZDVUHSODFHGE\DSHUVRQRXWVLGHWKHSURWHFWHGFODVVRU
ZDVWUHDWHGOHVVIDYRUDEO\WKDQDVLPLODUO\VLWXDWHGLQGLYLGXDO 7KH UHYLHZ RI WKLV MXGJPHQW XQGHUWDNHQ E\ WKH PDMRULW\
RXWVLGHKHUSURWHFWHGFODVV6HHLG 0LWFKHOOY7ROHGR+RVS RSLQLRQKRZHYHULVVRPHWKLQJRWKHUWKDQWKHGHQRYRUHYLHZ
)G WK&LU UHTXLUHG E\ WKH 6XSUHPH &RXUW DQG WKH SUHFHGHQW RI WKLV
FLUFXLW,QFRPLQJWRLWVFRQFOXVLRQWKDWJHQXLQHLVVXHVRI
,I3ODLQWLIILVDEOHWRHVWDEOLVKDSULPDIDFLHFDVHWKHQXQGHU PDWHULDO IDFW UHPDLQ IRU WULDO WKH PDMRULW\ RSLQLRQ WDNHV
WKHQH[WVWHSRIWKHWULSDUWLWHWHVWDPDQGDWRU\SUHVXPSWLRQRI MXGLFLDO QRWLFH RI ³IDFWV´ QRW LQ HYLGHQFH H[FRULDWHV WKH
GLVFULPLQDWLRQLVFUHDWHGDQGWKHEXUGHQVKLIWVWR'HIHQGDQW GHIHQGDQWIRUIDLOLQJWRSUHVHQWWKHHYLGHQFHLQWKHOLJKWPRVW
WR³DUWLFXODWHVRPHOHJLWLPDWHQRQGLVFULPLQDWRU\UHDVRQIRU IDYRUDEOHWRWKHSODLQWLIIKROGVLQDGPLVVLEOHHYLGHQFHQHYHU
WKH HPSOR\HH¶V UHMHFWLRQ´ 6HH 86 DW )LQDOO\ REMHFWHGWRE\WKHSODLQWLIIHLWKHUEHIRUHWKHGLVWULFWFRXUWRU
XQGHU WKH WKLUG VWHS LI 'HIHQGDQW FDUULHV LWV EXUGHQ LQ EHIRUHWKLVFRXUWDQGPDNHVILQGLQJVRIIDFW3HUKDSVPRVW
DUWLFXODWLQJDQRQGLVFULPLQDWRU\UHDVRQIRUWKHDFWLRQWKHQ XQVHWWOLQJWKHPDMRULW\RSLQLRQVD\VWKDWWKHGLVWULFWFRXUWZDV
3ODLQWLIIPXVWSURYHWKDWWKHSURIIHUHGUHDVRQZDVDFWXDOO\D UHTXLUHG WR UHYLHZ WKH GHIHQGDQW¶V PRWLRQ IRU VXPPDU\
SUHWH[W IRU LQYLGLRXV GLVFULPLQDWLRQ ,G 3ODLQWLII PD\ MXGJPHQWLQOLJKWRI'HQQ\¶V³SDVWKLVWRU\RIGLVFULPLQDWRU\
HVWDEOLVK WKDW WKH SURIIHUHG UHDVRQ ZDV D PHUH SUHWH[W E\ FRQGXFW ERWK WR LWV PLQRULW\ SDWURQV DQG HPSOR\HHV DOLNH
VKRZLQJWKDW WKHVWDWHGUHDVRQKDGQREDVLVLQIDFW WKH >ZKLFK@ LV ZHOO NQRZQ LQ WKH MXULVSUXGHQFH DQG SXEOLF
VWDWHGUHDVRQZDVQRWWKHDFWXDOUHDVRQ DQG WKDWWKHVWDWHG IRUXPV´
UHDVRQZDVLQVXIILFLHQWWRH[SODLQ'HIHQGDQW¶VDFWLRQ6HH
:KHHOHUY0F.LQOH\(QWHUV )G WK&LU 7KHVWDQGDUGRIUHYLHZRIDJUDQWRIVXPPDU\MXGJPHQW
³$ UHDVRQ FDQQRW EH SURYHG WR EH µD SUHWH[W IRU UHTXLUHVWKDWZHYLHZWKHHYLGHQFHLQWKHOLJKWPRVWIDYRUDEOH
GLVFULPLQDWLRQ¶XQOHVVLWLVVKRZQERWKWKDWWKHUHDVRQZDV WR WKH QRQPRYLQJ SDUW\ LW GRHV QRW SHUPLW XV WR H[FOXGH
IDOVHDQGWKDWGLVFULPLQDWLRQZDVWKHUHDOUHDVRQ´6W0DU\¶V DGPLVVLEOHHYLGHQFHRUWKDWWRZKLFKQRREMHFWLRQZDVUDLVHG
+RQRU&WUY+LFNV 86 EHORZ7KHPDMRULW\KROGVWKDWWKHDIILGDYLWVRI5DQG\3RSOLQ
DQG0DU\-HDQGHOD9HJDWKHWZR'HQQ\¶VHPSOR\HHVZLWKWKH
$ 3ULPD )DFLH &DVH RI 'LVFULPLQDWLRQ 8QGHU PRVW NQRZOHGJH DERXW /RJDQ¶V FODLP RI FRQVWUXFWLYH
86& H
7KHGLVWULFWFRXUWEHJDQLWVDQDO\VLVE\DFNQRZOHGJLQJWKDW
DV DQ $IULFDQ $PHULFDQ 3ODLQWLII ZDV D PHPEHU RI D 7KDW 'HQQ\¶V PD\ KDYH SUHYLRXVO\ VHWWOHG RU KDYH EHHQ WKH ORVHU LQ
SURWHFWHGFODVV7KHFRXUWWKHQIRFXVHGRQZKHWKHU3ODLQWLII DQRWKHU SURFHHGLQJ EDVHG XSRQ GLVFULPLQDWLRQ FKDUJHV LQYROYLQJ HQWLUHO\
VXIIHUHG DQ DGYHUVH HPSOR\PHQW DFWLRQ IRU SXUSRVHV RI GLIIHUHQW SDUWLHV DQG HQWLUHO\ GLIIHUHQW IDFWV DQG HYHQ D
JHRJUDSKLF ORFDOH LV LUUHOHYDQW DW WULDO LQ D VXEVHTXHQW SURFHHGLQJ ,Q WKLV
GLIIHUHQW
VDWLVI\LQJ WKH WKLUG HOHPHQW RI D SULPD IDFLH FDVH RI FDVH WKH GHFLVLRQ DW LVVXH ZDV UHQGHUHG DW WKH VXPPDU\ MXGJPHQW VWDJH
ZLWK QR HYLGHQFH RI DQ\ SULRU GLVFULPLQDWRU\ FRQGXFW E\ 'HQQ\¶V
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
BBBBBBBBBBBBBBBB GLVFULPLQDWLRQXQGHU7LWOH9,,7KHFRXUWUHFRJQL]HGWKDWLQ
RUGHUWRVDWLVI\WKLVHOHPHQW3ODLQWLIIKDGWRVKRZWKDWVKH
',66(17 VXIIHUHGDPDWHULDOO\DGYHUVHFKDQJHLQKHUHPSOR\PHQWDQG
BBBBBBBBBBBBBBBB QRWHGWKDW3ODLQWLIIVRXJKWWRGRVRKHUHE\FODLPLQJWKDWVKH
VXIIHUHGDFRQVWUXFWLYHGLVFKDUJH7KHFRXUWDOVRDFFXUDWHO\
$/,&(0%$7&+(/'(5&LUFXLW-XGJHGLVVHQWLQJ$V UHFRJQL]HG WKDW LQ RUGHU WR VKRZ WKDW VKH VXIIHUHG D
WKH PDMRULW\ RSLQLRQ HPSKDVL]HV WKLV DSSHDO FRQFHUQV WKH FRQVWUXFWLYH GLVFKDUJH 3ODLQWLII KDG WR FRPH IRUZDUG ZLWK
SURSULHW\RIWKHGLVWULFWFRXUW¶VJUDQWRIGHIHQGDQW'HQQ\¶V HYLGHQFHWRGHPRQVWUDWHWKDWWKHZRUNLQJFRQGLWLRQVXQGHU
PRWLRQIRUVXPPDU\MXGJPHQWRQSODLQWLII/RJDQ¶V7LWOH9,, ZKLFKVKHODERUHGZHUHVRGLIILFXOWWKDWDUHDVRQDEOHSHUVRQ
FODLPRIUDFLDOGLVFULPLQDWLRQEDVHGXSRQDOOHJHGFRQVWUXFWLYH VWDQGLQJLQKHUVKRHVZRXOGKDYHIHOWFRPSHOOHGWRUHVLJQ
GLVFKDUJH3ODLQWLIIGRHVQRWFKDOOHQJHRQDSSHDOGLVPLVVDORI DQGWKDW'HIHQGDQWLQWHQGHGWRFDXVH3ODLQWLIIWRUHVLJQRUWKDW
KHURWKHUFODLPVLQFOXGLQJVWDWHODZFODLPVEDVHGXSRQWKH KHUUHVLJQDWLRQZDVDUHDVRQDEO\IRUHVHHDEOHFRQVHTXHQFHRI
VDPH VHW RI IDFWV DVVHUWHG DV D EDVLV IRU KHU 7LWOH 9,, 'HIHQGDQW¶VDFWLRQV
FRQVWUXFWLYHGLVFKDUJH DOOHJDWLRQ 7KH PDMRULW\
DFNQRZOHGJHVWKDWWKHGLVWULFWFRXUW +RZHYHU GHVSLWH LWV DFFXUDWH UHFLWDWLRQ RI WKH ODZ WKH
GLVWULFWFRXUWHUUHGLQLWVDQDO\VLVEHFDXVHWKHGLVWULFWFRXUW
>$@FFXUDWHO\UHFRJQL]HGWKDWLQRUGHUWRVKRZWKDWVKH IDLOHG WR FRQVLGHU DQ\ HYLGHQFH UHODWLQJ WR WKH $SULO
VXIIHUHGDFRQVWUXFWLYHGLVFKDUJH3ODLQWLIIKDGWRFRPH LQFLGHQW ZKLFK VHUYHG DV WKH LPSHWXV WR 3ODLQWLII¶V
IRUZDUGZLWKHYLGHQFHWRGHPRQVWUDWHWKDWWKHZRUNLQJ UHVLJQDWLRQ,QVWHDGWKHFRXUWOLPLWHGLWVFRQVLGHUDWLRQWRWKH
FRQGLWLRQV>EHFDXVHRIUDFLDOGLVFULPLQDWLRQ@XQGHUZKLFK YDULRXV FRPPHQWV PDGH WR 3ODLQWLII GXULQJ KHU WHQXUH DW
VKH ODERUHG ZHUH VR GLIILFXOW WKDW D UHDVRQDEOH SHUVRQ +LJKODQG+HLJKWVVXFKDVWKH³JULWV´FRPPHQWWKH³ILUVWRI
VWDQGLQJ LQ KHU VKRHV ZRXOG KDYH IHOW FRPSHOOHG WR WKH PRQWK´ FRPPHQW DQG WKH ³VRPH RI \RXU SHRSOH´
UHVLJQ FRPPHQW DV ZHOO DV RWKHU DFWV VXFK DV 'HIHQGDQW¶V DFW RI
SRVWLQJWKH5HSRUWLQWKHHPSOR\HHVHFWLRQRIWKHUHVWDXUDQW
0DMRULW\2SDW DQG FRQFOXGHG WKDW 3ODLQWLII IDLOHG WR GHPRQVWUDWH WKH
UHTXLUHPHQWVRIDFRQVWUXFWLYHGLVFKDUJH7KHQGHVSLWHWKH
,QWKLV7LWOH9,,DFWLRQ(LOHHQ/RJDQFODLPVWKDWRQFHVKH IDFWWKDWWKHGLVWULFWFRXUWFRPSOHWHO\LJQRUHGHYLGHQFHRIWKH
WUDQVIHUUHGLQWRWKH'HQQ\¶V5HVWDXUDQWLQ+LJKODQG+HLJKWV $SULOLQFLGHQWLQUHODWLRQWR3ODLQWLII¶VSULPDIDFLHFDVH
'HQQ\¶V GLVFULPLQDWHG DJDLQVW KHU DQG VXEMHFWHG KHU WR D WKH FRXUW IRXQG LQ D IRRWQRWH WKDW 'HIHQGDQW¶V SURIIHUHG
KRVWLOHZRUNHQYLURQPHQWEHFDXVHVKHLV$IULFDQ$PHULFDQ UHDVRQIRUWDNLQJLWVGLVFLSOLQDU\DFWLRQ±FKDQJLQJ3ODLQWLII¶V
DQGWKDWEHFDXVHRI'HQQ\¶VWUHDWPHQWRIKHUVKHFRXOGQR MREFODVVLILFDWLRQ±ZDVQRWDSUHWH[WIRUUDFHGLVFULPLQDWLRQ
ORQJHUZRUNWKHUHDQGZDVLQIDFWFRQVWUXFWLYHO\GLVFKDUJHG ,QRWKHUZRUGVWKHFRXUWZDVDZDUHRI'HIHQGDQW¶VFODLPRI
7KH PDMRULW\ RSLQLRQ KROGV WKDW WKH GLVWULFW FRXUW HUUHG LQ 3ODLQWLII¶V SRRU SHUIRUPDQFH LQ UHODWLRQ WR WKH $SULO
JUDQWLQJ'HQQ\¶VPRWLRQIRUVXPPDU\MXGJPHQW%HFDXVH, LQFLGHQW DQG DOORZHG 'HIHQGDQW WR XVH WKLV HYLGHQFH DV D
EHOLHYH WKDW WKH PDMRULW\ RSLQLRQ LV FRQWUDU\ WR ODZ LQ D OHJLWLPDWHQRQGLVFULPLQDWRU\UHDVRQIRULWVDFWLRQVEXWWKH
QXPEHU RI VLJQLILFDQW DQG WURXEOLQJ UHVSHFWV , PXVW FRXUWUHIXVHGWRFRQVLGHUWKHHYLGHQFHDVDEDVLVIRU3ODLQWLII¶V
UHVSHFWIXOO\GLVVHQW FRQVWUXFWLYH GLVFKDUJH FODLP :H ILQG WKH GLVWULFW FRXUW¶V
DQDO\VLV HUURQHRXV DQG LQ FRPSOHWH FRQWUDYHQWLRQ WR WKH
$QDSSHOODWHFRXUWUHYLHZVGHQRYRDGLVWULFWFRXUW¶VRUGHU UHTXLUHPHQW WKDW ZKHQ GHFLGLQJ D PRWLRQ IRU VXPPDU\
JUDQWLQJVXPPDU\MXGJPHQW/LNHWKHGLVWULFWFRXUWZHPXVW
YLHZWKHIDFWVLQWKHOLJKWPRVWIDYRUDEOHWRWKHQRQPRYLQJ
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
MXGJPHQWWKHHYLGHQFH±DOORIWKHHYLGHQFH±EHYLHZHGLQ ³7KH XQLW 'HQQ\¶V FKDLQ D GLYLVLRQ RI $GYDQWLFD
WKHOLJKWPRVWIDYRUDEOHWRWKHQRQPRYLQJSDUW\ 5HVWDXUDQW *URXS DJUHHG WR UHWUDLQ PDQDJHUV DW FRPSDQ\
ORFDWLRQV DIWHU IDFLQJ 86 -XVWLFH 'HSDUWPHQW FKDUJHV RI
+DYLQJ SRLQWHG RXW WKHVH GHILFLHQFLHV DQG HUURUV LQ WKH GLVFULPLQDWRU\KLULQJSUDFWLFHV´
GLVWULFWFRXUW¶VPHPRUDQGXPRSLQLRQZHZLOOQRZDQDO\]H
3ODLQWLII¶V FDVH LQ WKH SURSHU OLJKW $V VWDWHG XQGHU WKH $OWKRXJK ZH UHFRJQL]H WKDW 'HIHQGDQW¶V SDVW UHFRUG RI
FLUFXPVWDQWLDO HYLGHQWLDU\ SDWKZD\ 3ODLQWLII PXVW ILUVW GLVFULPLQDWLRQ LV QRW DW LVVXH KHUH WKH IDFW UHPDLQV WKDW
HVWDEOLVK SURYH DSULPD IDFLH FDVH RI GLVFULPLQDWLRQ XQGHU 'HIHQGDQWLVQRVWUDQJHUWRUDFHGLVFULPLQDWLRQVXLWVDQGWKH
7LWOH9,,6HH-RKQVRQY8QLYRI&LQFLQQDWL)G GLVWULFWFRXUW¶VIDLOXUHWRVHHWKURXJK'HIHQGDQW¶VWDFWLFVDQG
WK &LU 2QH RI WKH HOHPHQWV VKH PXVW UHFRJQL]HWKHPDQ\JHQXLQHLVVXHVRIPDWHULDOIDFWLQWKLVFDVH
GHPRQVWUDWH±WKHHOHPHQWZKLFKWKHGLVWULFWEHOLHYHG3ODLQWLII LVGLVWXUELQJ
IDLOHGWRHVWDEOLVKDQGWKHUHIRUHIRXQGGLVSRVLWLYHLQJUDQWLQJ
VXPPDU\ MXGJPHQW ± LV WKDW 3ODLQWLII VXIIHUHG DQ DGYHUVH &21&/86,21
HPSOR\PHQWDFWLRQ,G3ODLQWLIIPD\HVWDEOLVKDQDGYHUVH
HPSOR\PHQW DFWLRQ E\ GHPRQVWUDWLQJ WKDW VKH ZDV 7KHGLVWULFWFRXUWHUUHGLQJUDQWLQJ'HIHQGDQW¶VPRWLRQIRU
FRQVWUXFWLYHO\GLVFKDUJHG6HH.RFVLVY0XOWL&DUH0JPW VXPPDU\MXGJPHQWZKHUH3ODLQWLIIHVWDEOLVKHGDSULPDIDFLH
)G WK &LU 7R GHPRQVWUDWH D FDVHRIGLVFULPLQDWLRQXQGHU7LWOH9,,DQGFDPHIRUZDUGZLWK
FRQVWUXFWLYH GLVFKDUJH 3ODLQWLII PXVW DGGXFH HYLGHQFH WR VXIILFLHQWHYLGHQFHWRVKRZWKDW'HIHQGDQW¶VDOOHJHGUHDVRQ
IRULWVDFWLRQZDVSUHWH[WXDO:HWKHUHIRUH5(9(56(WKH
GLVWULFW FRXUW¶V RUGHU JUDQWLQJ 'HIHQGDQW¶V PRWLRQ IRU
VXPPDU\MXGJPHQWDQG5(0$1'WKHFDVHIRUWULDO
:H QRWH WKDW WKH GLVVHQW FULWLFL]HV WKH PDMRULW\ IRU LQDSSURSULDWHO\
HQJDJLQJ LQ IDFW ILQGLQJ DV ZHOO DV IRU LPSURSHUO\ UHTXLULQJ 'HIHQGDQW WR
SUHVHQW WKH HYLGHQFH LQ WKH OLJKW PRVW IDYRUDEOH WR 3ODLQWLII +RZHYHU D
UHYLHZ RI WKH PDMRULW\ RSLQLRQ UHYHDOV WKDW WKH GLVVHQW LV ZURQJ RQ ERWK
DFFRXQWV )LUVW DV ZLOO EH VKRZQ EHFDXVH WKH GLVWULFW FRXUW FRPSOHWHO\
IDLOHG WR FRQVLGHU HYLGHQFH RI WKH $SULO LQFLGHQW LQ UHODWLRQ WR
3ODLQWLII¶V FRQVWUXFWLYH GLVFKDUJH FODLP ZH KDYH SURSHUO\ EURXJKW WR WKH
IRUH WKH HYLGHQFH DGGXFHG E\ 3ODLQWLII LQ WKLV UHJDUG DQG GHPRQVWUDWHG
RXU EHOLHI DV WR ZK\ WKH HYLGHQFH LV VXIILFLHQW WR FUHDWH DQ LQIHUHQFH RI
GLVFULPLQDWLRQ LQ WKH PLQGV RI D UHDVRQDEOH MXURU 7KLV DQDO\VLV RI
FRXUVH LV SUHFLVHO\ WKH W\SH WKDW ZH DUH UHTXLUHG WR PDNH XQGHU D /0 34;4
UHYLHZ DW WKH VXPPDU\ MXGJPHQW VWDJH 800 'H3LHUR Y &LW\ RI 0DFHGRQLD
)G WK &LU QRWLQJ WKDW WKH UHYLHZLQJ FRXUW PXVW
UHYLHZ DOO RI WKH IDFWV DQG LQIHUHQFHV GUDZQ WKHUHIURP LQ WKH OLJKW PRVW
IDYRUDEOH WR WKH QRQPRYLQJ SDUW\ DQG EULQJLQJ HYLGHQFH DGGXFHG E\
3ODLQWLII EXW HUURQHRXVO\ GLVUHJDUGHG E\ WKH GLVWULFW FRXUW WR WKH IRUH
FDQQRW DFFXUDWHO\ EH FKDUDFWHUL]HG DV IDFW ILQGLQJ ,Q DGGLWLRQ WKH 6HH ,HUDGL Y 0\ODQ /DEV ,QF )G Q G &LU
PDMRULW\ LQ QR ZD\ LPSOLHV WKDW 'HIHQGDQW PXVW SUHVHQW WKH HYLGHQFH LQ WDNLQJ MXGLFLDO QRWLFH RI DUWLFOH LQ WKH 1HZ 854 F.2d 914, 916 (6th Cir. 1988). GLVWULFW FRXUW FLWLQJ 3HWHUV Y 'HO 5LYHU 3RUW $XWK )G
([DPSOHV RI ZKDW WKH PDMRULW\ EHOLHYHV WR EH 'HIHQGDQW¶V G &LU 8QLWHG 6WDWHV Y 3R]VJDL )G G &LU
PLVUHSUHVHQWDWLRQV RI WKH UHFRUG DUH VHW IRUWK LQIUD
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
&XQQLQJKDPY6HDUV5RHEXFN &R)G WK VKRZ WKDW ³WKH HPSOR\HU GHOLEHUDWHO\ FUHDWH>G@
&LU LQWROHUDEOHZRUNLQJFRQGLWLRQVDVSHUFHLYHGE\DUHDVRQDEOH
SHUVRQ´ DQG WKHHPSOR\HUGLGVR³ZLWKWKHLQWHQWLRQRI
:H DUH DOVR WURXEOHG E\ WKH GLVWULFW FRXUW¶VDSSDUHQW IRUFLQJWKHHPSOR\HHWRTXLW´0RRUHY.XND:HOGLQJ
FRPSODFHQF\ UHJDUGLQJ 'HIHQGDQW¶V PLVUHSUHVHQWDWLRQV DV 6\V)G WK&LU ³7RGHWHUPLQHLI
ZHOO DV WKH GLVWULFW FRXUW¶V RYHUDOO KDQGOLQJ RI WKH FDVH WKHUHLVDFRQVWUXFWLYHGLVFKDUJHERWKWKHHPSOR\HU¶VLQWHQW
'HIHQGDQW¶VSDVWKLVWRU\RIGLVFULPLQDWRU\FRQGXFWERWKWRLWV DQGWKHHPSOR\HH¶VREMHFWLYHIHHOLQJVPXVWEHH[DPLQHG´,G
PLQRULW\SDWURQVDQGHPSOR\HHVDOLNHLVZHOONQRZQLQWKH FLWLQJ +HOG Y *XOI 2LO &R )G WK &LU
MXULVSUXGHQFH DQG SXEOLF IRUXPV ([DPSOHV RI KLJKO\
SXEOLFL]HG FDVHV LQYROYLQJ 'HIHQGDQW¶V GLVFULPLQDWRU\
FRQGXFW LQFOXGH WZR FODVV DFWLRQ VXLWV DOOHJLQJ UDFH 7KH)LIWK&LUFXLWKDVVHWIRUWKDQXPEHURIIDFWRUVWKDWD
GLVFULPLQDWLRQXQGHU86&D±'\VRQY)ODJVWDU FRXUWVKRXOGFRQVLGHUIRUSXUSRVHVRIVDWLVI\LQJWKHILUVWSURQJ
&RUS &$ 1R IURP WKH 8QLWHG 6WDWHV 'LVWULFW RIWKHFRQVWUXFWLYHGLVFKDUJHLQTXLU\
&RXUWLQ0DU\ODQGDQG5LGJHZD\Y)ODJVWDU&RUS&LY1R
IURP WKH 8QLWHG 6WDWHV 'LVWULFW &RXUW IRU WKH :KHWKHUDUHDVRQDEOHSHUVRQZRXOGKDYHIHHOFRPSHOOHG
1RUWKHUQ'LVWULFWRI&DOLIRUQLD±ZKLFK'HIHQGDQWVHWWOHGIRU WR UHVLJQ GHSHQGV RQ WKH IDFWV RI HDFK FDVH EXW ZH
PRUHWKDQILIW\IRXUPLOOLRQGROODUVSXUVXDQWWRWZRFRQVHQW FRQVLGHU WKH IROORZLQJ IDFWRUV UHOHYDQW VLQJO\ RU LQ
GHFUHHV 6HH 6DYDJH Y 'HQQ\¶V ,QF 1R &LY $ FRPELQDWLRQ GHPRWLRQ UHGXFWLRQ LQ VDODU\
:/ DW
(' 3D $SU UHGXFWLRQLQMREUHVSRQVLELOLWLHV UHDVVLJQPHQWWR
XQSXEOLVKHG &KULV :LQVWRQ $GYDQWLFD 3UHVLGHQW 6WHSV PHQLDO RU GHJUDGLQJ ZRUN UHDVVLJQPHQW WR ZRUN
'RZQ6SDUWDQEXUJ+HUDOG-DQDW$7KHVWDWHG XQGHUD\RXQJHUVXSHUYLVRU EDGJHULQJKDUDVVPHQW
SXUSRVH RI WKHVH GHFUHHV LV WR LQVXUH WKDW ³µDOO IXWXUH RUKXPLOLDWLRQE\WKHHPSOR\HUFDOFXODWHGWRHQFRXUDJH
FXVWRPHUVRIFRPSDQ\RZQHGDQGIUDQFKLVHRZQHG'HQQ\¶V WKH HPSOR\HH¶V UHVLJQDWLRQ RU RIIHUV RI HDUO\
5HVWDXUDQWV DUH DFFRUGHG HTXDO WUHDWPHQW DQG VHUYLFH UHWLUHPHQW RU FRQWLQXHG HPSOR\PHQW RQ WHUPV OHVV
UHJDUGOHVV RI UDFH DQGRU FRORU¶´ 6HH 0F&RR Y 'HQQ\¶V IDYRUDEOHWKDQWKHHPSOR\HH¶VIRUPHUVWDWXV
,QF1R&29$ 5'5:/DW
'
.DQ)HE 6DYDJH :/ DW
,Q %URZQ Y %XQJH &RUS )G WK &LU
DGGLWLRQ'HIHQGDQWKDVFRPHXQGHUILUHIRULWVGLVFULPLQDWRU\ DOWHUDWLRQV RPLWWHG TXRWLQJ %DUURZ Y 1HZ 2UOHDQV
KLULQJ SUDFWLFHV DV ZHOO 6HH 5RQ 5XJJOHVV V@ZRUQRUFHUWLILHGFRSLHVRIDOO 7KH GLVVHQW¶V FODLP WKDW WKH PDMRULW\ ³GRHV QRW GLVSXWH DQ\ RI WKH
SDSHUV RU SDUWV WKHUHRI UHIHUUHG WR LQ DQ DIILGDYLW VKDOO EH VSHFLILF LQIRUPDWLRQ WR ZKLFK 'HQQ\¶V EULHI UHIHUV´ LV EDIIOLQJ :H PRVW
DWWDFKHGWKHUHWRRUVHUYHGWKHUHZLWK´)(' 5 &,9 3 H FHUWDLQO\ GLVSXWH 'HQQ\¶V VWDWHPHQWV LQ LWV EULHI WKDW ³0V 7D\ORU ZDUQHG
3ODLQWLII WKDW VKH ZRXOG ILQG WKH +LJKODQG +HLJKWV XQLW WR EH GLIIHUHQW
³7KLVFRXUWKDVUXOHGWKDWGRFXPHQWVVXEPLWWHGLQVXSSRUWRI IURP WKH 1RUWK 5DQGDOO XQLW´ DQG WKDW ³>G@HVSLWH WKHVH ZDUQLQJV 3ODLQWLII
DPRWLRQIRUVXPPDU\MXGJPHQWPXVWVDWLVI\WKHUHTXLUHPHQWV GHFLGHG WR WUDQVIHU WR WKH +LJKODQG +HLJKWV XQLW>@´ 7KH FOHDU DQG H[SUHVV
RI5XOH H RWKHUZLVHWKH\PXVWEHGLVUHJDUGHG´0RRUH LPSOLFDWLRQ RI WKHVH VWDWHPHQWV SDUWLFXODUO\ ZKHQ WDNHQ LQ FRQWH[W ZLWK
Y+ROEURRN)G WK&LU FLWLQJ'ROHY WKH RWKHU VWDWHPHQWV DV TXRWHG DERYH LV WR PLVOHDG WKH FRXUW LQWR EHOLHYLQJ
(OOLRWW7UDYHO 7RXUV,QF )G WK&LU WKDW 'HIHQGDQW DWWHPSWHG WR FDXWLRQ 3ODLQWLII IURP WUDQVIHUULQJ WR
+LJKODQG +HLJKWV EHFDXVH RI WKH IDVWHU SDFH RQ WKH EHOLHI WKDW 3ODLQWLII
ZRXOG QRW EH DEOH WR KDQGOH WKH IDVWHUSDFHG HQYLURQPHQW ,QGHHG WKLV
SUHPLVH VXSSRUWV 'HIHQGDQW¶V WKHRU\ RI WKH FDVH +RZHYHU ZKHQ ZH
H[DPLQHG WKH XQUHIXWHG GHSRVLWLRQ WHVWLPRQ\ ZKLFK 'HIHQGDQW FLWHV LQ
VXSSRUW RI WKLV FRQWHQWLRQ WKH UHFRUG LQGLFDWHV QRW WKDW 3ODLQWLII ZDV
6SHFLILFDOO\ 3RSOLQ DYHUUHG WKDW ³>W@KH (35 SUHSDUHG VWDWHG WKDW LW ³ZDUQHG´ RU FDXWLRQHG DJDLQVW WUDQVIHUULQJ WR +LJKODQG +HLJKWV EHFDXVH
ZDV EHLQJ LVVXHG GXH WR VHUYLFHUHODWHG SHUIRUPDQFH LVVXHV DQG WKDW 0V RI WKH IDVWHUSDFHG HQYLURQPHQW EXW LQVWHDG WKDW VKH ZDV HQFRXUDJHG WR
/RJDQ ZDV EHLQJ JLYHQ WKH RSWLRQ RI PRYLQJ LQWR HLWKHU D +RVWHVV RU WUDQVIHU WR +LJKODQG +HLJKWV EHFDXVH RI LWV IDVWHU SDFH DQG 3ODLQWLII¶V
6HUYLFH $VVLVWDQW SRVLWLRQ> @´ ZKLOH GHOD9HJD DYHUUHG WKDW ³>W@KH (35 DELOLWLHV WR NHHS XS ZLWK WKLV SDFH $OWKRXJK 'HIHQGDQW LV QRW UHTXLUHG WR
SUHSDUHG E\ 0U 3RSOLQ VWDWHG WKDW LW ZDV EHLQJ LVVXHG GXH WR VHUYLFH FDVW WKH HYLGHQFH LQ WKH OLJKW PRVW IDYRUDEOH WR 3ODLQWLII DW WKH VDPH WLPH
UHODWHG SHUIRUPDQFH LVVXHV DQG WKDW 0V /RJDQ ZDV EHLQJ JLYHQ WKH RSWLRQ LW LV QRW DOORZHG WR PLVUHSUHVHQW WKH HYLGHQFH WR VXSSRUW LWV WKHRU\ RI WKH
RI PRYLQJ LQWR D +RVWHVV RU 6HUYLFH $VVLVWDQW SRVLWLRQ´ -$ DW FDVH DV ZH EHOLHYH 'HIHQGDQW KDV GRQH KHUH
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
ZLWKWKHIDVWHUSDFHDW+LJKODQG+HLJKWV6SHFLILFDOO\LQLWV 6WDWH0XW/LIH$VVXUDQFH&RRI$PY'HHU&UHHN
EULHIRQDSSHDO'HIHQGDQWVWDWHVDVIROORZV 3DUN)G WK&LU
$IWHUOHDUQLQJ WKDWWKH1RUWK5DQGDOOXQLWZRXOGEH +HUH EHFDXVH 'HIHQGDQW IDLOHG WR DWWDFK RU SURGXFHWKH
FORVLQJ 3ODLQWLIIVSRNHZLWK-RKQ+DODV]WKH*HQHUDO (35WRZKLFK3RSOLQDQGGHOD9HJDPDNHUHIHUHQFHLQWKHLU
0DQDJHUDWD'HQQ\¶VUHVWDXUDQWORFDWHGRQ:LOVRQ0LOOV DIILGDYLWVWKHDIILGDYLWVPXVWEHGLVUHJDUGHG6HH)HG5
5RDGLQ+LJKODQG+HLJKWV2KLRDERXWWKHSRVVLELOLW\RI &LY 3 H 0RRUH )G DW 7KLV OHDYHV XV ZLWK
WUDQVIHUULQJWRWKDWXQLW3ODLQWLIIDOVRVSRNHZLWK/LQGD GHOD9HJD¶V GHSRVLWLRQ WHVWLPRQ\ WKDW WKH (35 RIIHUHG
7D\ORUKHUPDQDJHUDWWKH1RUWK5DQGDOOXQLWDERXWWKH 3ODLQWLII WKH FKRLFH RI EHFRPLQJ D KRVWHVV RU D EXVER\ WR
SRVVLELOLW\RIDWUDQVIHUWR+LJKODQG+HLJKWV'XULQJWKLV FRQWUDVW ZLWK3ODLQWLII¶VGHSRVLWLRQWHVWLPRQ\WKDWWKH(35
FRQYHUVDWLRQ0V7D\ORUZDUQHG3ODLQWLIIWKDWVKHZRXOG SURYLGHG RQO\ IRU KHU WUDQVIHU WR WKH EXVER\ SRVLWLRQ
ILQGWKH+LJKODQG+HLJKWVXQLWWREHGLIIHUHQWIURPWKH 9LHZLQJWKHHYLGHQFHLQWKHOLJKWPRVWIDYRUDEOHWR3ODLQWLII
1RUWK 5DQGDOO XQLW 6SHFLILFDOO\ 0V 7D\ORU WROG ZHFRQFOXGHIRUSXUSRVHVRIVXPPDU\MXGJPHQWWKDWWKHRQO\
3ODLQWLII WKDW WKH +LJKODQG +HLJKWV XQLW ZDV D ³IDVWHU MRE FODVVLILFDWLRQ RIIHUHG WR 3ODLQWLII ZDV WKDW RI VHUYLFH
HQYLURQPHQW´ZKHUHWKLQJVZHUH³PRUHVWUXFWXUHG´WKDQ DVVLVWDQWRUEXVER\6HH$KOHUV)GDW VWDWLQJWKDW
ZKDW VKH ZDV XVHG WR 7KH UHDVRQ IRU WKH GLIIHUHQFHV DFRXUWPD\QRWPDNHFUHGLELOLW\GHWHUPLQDWLRQVQRUZHLJKWKH
EHWZHHQ WKH WZR XQLWV ZDV WKH IDFW WKDW WKH +LJKODQG HYLGHQFHZKHQUHYLHZLQJDPRWLRQIRUVXPPDU\MXGJPHQW
+HLJKWVXQLWZDVRIPXFK³KLJKHUYROXPH´PHDQLQJWKDW UDWKHU WKH HYLGHQFH PXVW EH YLHZHG LQ WKH OLJKW PRVW
PDQ\PRUHFXVWRPHUVYLVLWHGWKH+LJKODQG+HLJKWVXQLW IDYRUDEOH WR WKH QRQPRYLQJ SDUW\ ZKHUH DOO UHDVRQDEOH
HDFK GD\ WKDQ YLVLWHG WKH 1RUWK 5DQGDOO XQLW 7KLV LQIHUHQFHVLQXUHWRWKDWSDUW\¶VEHQHILW
FUHDWHG JUHDWHU GHPDQGV RQ 6HUYHUV 'HVSLWH WKHVH
ZDUQLQJV3ODLQWLIIGHFLGHGWRWUDQVIHUWRWKH+LJKODQG
+HLJKWV XQLW ZKHUH VKH VWDUWHG ZRUNLQJ LQ 0DUFK RI
'HIHQGDQW¶V%ULHIRQ$SSHDODW FLWDWLRQVWRUHFRUGDQGMRLQW 7KH GLVVHQW PDNHV WKH FODLP WKDW WKH PDMRULW\ LV UDLVLQJ WKH 5XOH
H DUJXPHQW RQ DSSHDO 8:, VSRQWH +RZHYHU 3ODLQWLII UDLVHG WKH 5XOH
DSSHQGL[RPLWWHG HPSKDVLVDGGHG H DUJXPHQW LQ UHIHUHQFH WR WKH (35 DQG WKH DIILGDYLWV LQ TXHVWLRQ ERWK
LQ KHU UHSO\ EULHI DV ZHOO DV DW RUDO DUJXPHQW 7R WKH H[WHQW WKDW 3ODLQWLII
:KHQZHUHIHUHQFHGWKHFLWDWLRQVWRWKHUHFRUGDQGMRLQW PD\ QRW KDYH UDLVHG WKLV DUJXPHQW EHORZ WKLV FRXUW UHFRJQL]HG LQ 0RRUH
DSSHQGL[ DV SURYLGHG E\ 'HIHQGDQW LQ VXSSRUW RI LWV Y +ROEURRN WKDW WKH IDLOXUH RI D SDUW\ WR UDLVH DQ DUJXPHQW EHIRUH WKH
FRQWHQWLRQ WKDW 3ODLQWLII ZDV ³ZDUQHG´ DERXW WKH KLJKHU GLVWULFW FRXUW LV QRW DQ DEVROXWH EDU WR FRQVLGHUDWLRQ RI WKH LVVXH RQ DSSHDO
GHPDQGVWKDWZRXOGEHSODFHGXSRQKHULIVKHWUDQVIHUUHGWR 6HH )G WK &LU FLWLQJ 7DIW %URDG&R Y 8QLWHG
+LJKODQG+HLJKWVDQGWKDWVKHPDGHWKHWUDQVIHUGHVSLWHWKHVH 6WDWHV )G WK &LU 7KH 7DIW FRXUW SURYLGHG DQ
H[WHQVLYH DQDO\VLV RI ZKHQ DQ DSSHOODWH FRXUW PD\ GLVUHJDUG WKH JHQHUDO
³ZDUQLQJV´ZHZHUHJXLGHGWRDVLQJOHGRFXPHQW3ODLQWLII¶V SULQFLSOH WKDW QHZO\ UDLVHG LVVXHV DUH QRW FRQVLGHUHG RQ DSSHDO DQG QRWHG
GHSRVLWLRQWHVWLPRQ\8SRQUHDGLQJWKHWHVWLPRQ\ZHIRXQG WKDW RQH VXFK LQVWDQFH LV ZKHQ ³µ>W@KH LVVXH UDLVHG LV SXUHO\ RQH RI ODZ
WKDWLWLQQRZD\VXSSRUWV'HIHQGDQW¶VFRQWHQWLRQ,QIDFWD UHTXLULQJ QR QHZ RU DPSOLILHG IDFWXDO GHWHUPLQDWLRQ¶´ 6HH 7DIW )G
SODLQ UHDGLQJ RI 3ODLQWLII¶V XQGLVSXWHG WHVWLPRQ\ VWDWHV DW TXRWLQJ %ODFN 0RWRU &R Y &RPP¶U )G WK &LU
LQGLFDWHVWKDW7D\ORUDGYLVHG3ODLQWLIIWRWUDQVIHUWR+LJKODQG +HUH DV VWDWHG VXSUD 'HIHQGDQW DGPLWV WKDW LW KDV QRW SURGXFHG
WKDW (35 DQG FODLPHG DW RUDO DUJXPHQW WKDW WKH (35 KDV EHHQ ORVW RU
+HLJKWV DV RSSRVHG WR *DUILHOG +HLJKWV ± HYHQ WKRXJK WKH PLVSODFHG $V D UHVXOW QR QHZ IDFWXDO GHWHUPLQDWLRQ UHPDLQV UHJDUGLQJ
IRUPHUZDVPXFKIXUWKHUDZD\IURP1RUWK5DQGDOODQGPHDQW 'HIHQGDQW¶V IDLOXUH WR SURGXFH WKLV GRFXPHQW DQG ZH DUH WKXV IUHH WR
FRQVLGHU WKLV SXUHO\ OHJDO LVVXH 6HH LG
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
$FFHSWLQJDVZHPXVWWKDWWKHRQO\RIIHUPDGHWR3ODLQWLII QRJHQXLQHLVVXHRIIDFWUHPDLQHGIRUWULDODVWR'HIHQGDQW¶V
LIVKHZLVKHGWRUHPDLQHPSOR\HGE\'HIHQGDQWZDVWKDWRI WKHRU\'HIHQGDQWEHJLQVLWVEULHIRQDSSHDOZLWKDWDEOHWKDW
VHUYLFHDVVLVWDQWWKHLQTXLU\EHFRPHVZKHWKHUDUHDVRQDEOH FRQWLQXHVRQIRUDERXWWKUHHSDJHVZKHUHLQ'HIHQGDQWWRRN
HPSOR\HH VWDQGLQJ LQ 3ODLQWLII¶V VKRHV ZRXOG KDYH IHOW WKH LQGLYLGXDOL]HG VHFWLRQV IURP HDFK RI 3ODLQWLII¶V
FRPSHOOHG WR UHVLJQ JLYHQ WKLV XOWLPDWXP 6HH .RFVLV SHUIRUPDQFHDSSUDLVDOVRYHUDWHQ\HDUSHULRGDQGVLQJOHGRXW
)GDW %URZQ)GDW7KLVLQTXLU\LQYROYHV WKRVH FDWHJRULHV LQ ZKLFK 3ODLQWLII UHFHLYHG D ³EHORZ
FRQVLGHUDWLRQRIWKHQRQH[FOXVLYHOLVWRIIDFWRUVQRWHGDERYH VWDQGDUGV´ VFRUH 7KLV WDEOH ZKLFK VHWV WKH WRQH IRU
7KHILUVW IDFWRUWRFRQVLGHULVZKHWKHUDUHDVRQDEOHSHUVRQ 'HIHQGDQW¶V³VWDWHPHQWRIIDFWV´KDVDVWURQJLPSDFWRQWKH
ZRXOGKDYHYLHZHGWKHMREFKDQJHDVDGHPRWLRQ6HH%URZQ UHDGHU LQDVPXFK DV RQH SHUFHLYHV D OLWDQ\ RI ³EHORZ
)GDW$OWKRXJKGHOD9HJDVWDWHGLQKHUGHSRVLWLRQ VWDQGDUGV´VFRUHRQDQ\JLYHQSDJH)RUH[DPSOHRQSDJH
WHVWLPRQ\ WKDW VKH GLG QRW EHOLHYH WKDW D MRE FKDQJH IURP IRXU RI 'HIHQGDQW¶V EULHI WKH ³EHORZ VWDQGDUGV´ VFRUH LV
VHUYHU WR EXVER\ ZDV D GHPRWLRQ 3ODLQWLII WHVWLILHG LQ KHU OLVWHGE\'HIHQGDQWWKLUW\WZRWLPHV RYHUWKHFRXUVHRIQHDUO\
GHSRVLWLRQ WKDW VKH FRQVLGHUHG WKH FKDQJH GHJUDGLQJ WKUHHSDJHVWKH³EHORZVWDQGDUGV´VFRUHLVOLVWHGDWRWDORI
&RPPRQVHQVHZRXOGOHDGDUHDVRQDEOHSHUVRQWRFRQFOXGH VHYHQW\WZRWLPHV5HYLHZLQJ'HIHQGDQW¶VEULHIOHDGVRQHWR
WKDWWKHMREFKDQJHZDVDGHPRWLRQEHFDXVH'HIHQGDQWZDV FRQFOXGHWKDW3ODLQWLII¶VRYHUDOOSHUIRUPDQFHDVDVHUYHUKDV
DOOHJHGO\ FKDQJLQJ 3ODLQWLII¶V MRE FODVVLILFDWLRQ DV D EHHQSRRUVLQFHVKHEHJDQKHUHPSOR\PHQWZLWK'HIHQGDQW
GLVFLSOLQDU\PHDVXUHIRUKHUSRRUSHUIRUPDQFH,WWKHUHIRUH
ORJLFDOO\IROORZVWKDW'HIHQGDQWZDVQRWRIIHULQJ3ODLQWLIID +RZHYHU ZKHQ ZH UHYLHZHG 3ODLQWLII¶V SHUIRUPDQFH
EHWWHUSRVLWLRQRUHYHQDODWHUDOSRVLWLRQ$WRUDODUJXPHQW DSSUDLVDOVLQWKHUHFRUGZHZHUHOHIWZLWKDPXFKGLIIHUHQW
'HIHQGDQWFODLPHGWKDW3ODLQWLIIIDLOHGWRFRPHIRUZDUGZLWK LPSUHVVLRQRI3ODLQWLII¶VVNLOOV$VLOOXVWUDWHGLQWKLVRSLQLRQ
DQ\ HYLGHQFH VXFK DV WKH MRE GHVFULSWLRQ RI D EXVER\ WR WKHVH YHU\ VDPH SHUIRUPDQFH DSSUDLVDOV WKDW 'HIHQGDQW
VXSSRUW KHU FRQWHQWLRQ WKDW PRYLQJ WR WKLV SRVLWLRQ ZRXOG FKDUDFWHUL]HV DV EHLQJ ³EHORZ VWDQGDUGV´ ZHUH LQ VRPH
KDYHEHHQGHJUDGLQJ+RZHYHUZHFDQWDNHMXGLFLDOQRWLFH LQVWDQFHV JORZLQJ 2QO\ RQH RI WKH PDQ\ SHUIRUPDQFH
WKDWDEXVER\RU³VHUYLFHDVVLVWDQW´DV'HIHQGDQWHQWLWOHVLWLV DSSUDLVDOVSURYLGHGLQWKHDSSHQGL[LQGLFDWHVDQRYHUDOOVFRUH
D MRE FODVVLILFDWLRQ EHORZ WKDW RI D ZDLWHU RU VHUYHU RI ³EHORZ VWDQGDUGV´ 7KH RWKHU SHUIRUPDQFH DSSUDLVDOV
SDUWLFXODUO\DWWKLVW\SHRIUHVWDXUDQW$OWKRXJKWKLV&RXUWKDV LQGLFDWH DQ RYHUDOO VFRUH RI ³DW VWDQGDUGV´ RU ³DERYH
RSLQHG WKDW D GHPRWLRQ LQ LWVHOI GRHV QRW FRQVWLWXWH D VWDQGDUGV´DQGVHYHUDORIWKHDSSUDLVDOVEHDUFRPSOLPHQWDU\
FRQVWUXFWLYHGLVFKDUJHVHH:LOVRQY)LUHVWRQH7LUH 5XEEHU UHPDUNVDVWR3ODLQWLII¶VDELOLWLHVVXFKDV3ODLQWLII³LVQRWZHDN
&R )G WK &LU WKH GHPRWLRQ LV LQ DQ\ DUHDV 6KH LV FRPSHWHQW LQ VHUYLFH WHDP ZRUN DQG
VLJQLILFDQWZKHQFRXSOHGZLWKWKHRWKHUIDFWRUV RWKHU DVSHFWV RI WKH MRE FRGH VHUYHU´ -$ DW
7KHVHFRPPHQWVDOVRLQFOXGHVWDWHPHQWVVXFKDV³2YHUDOO
1H[W ZH FRQVLGHU ZKHWKHU 3ODLQWLII ZRXOG KDYH WDNHQ D \RX¶UHGRLQJJUHDW±.HHSLWXS´ -$DW DQG³*RRG
UHGXFWLRQ LQ VDODU\ E\ WUDQVIHUULQJ WR WKH EXVER\ SRVLWLRQ MRE :H QHHG \RX PRUH´ -$ DW 'HIHQGDQW
GHOD9HJD VWDWHG LQ KHU GHSRVLWLRQ WHVWLPRQ\ WKDW VHUYLFH FRQVSLFXRXVO\ IDLOV WR PDNH PHQWLRQ RI WKHVH IDYRUDEOH
DVVLVWDQWVVWDUWHGDWPLQLPXPZDJHZLWKWKHPD[LPXPKRXUO\ RYHUDOOVFRUHVDQGFRPPHQWVLQLWVEULHIWKHUHE\PLVOHDGLQJ
ZDJHULVLQJWRRU ZKLOHVHUYHUVEHJDQDWDERXW WKH &RXUW DV WR 3ODLQWLII¶V RYHUDOO UDWLQJ DV D VHUYHU ZKLOH
SHUKRXUDQGUHDFKHGDPD[LPXPKRXUO\UDWHRI HPSOR\HGE\'HIHQGDQW
SOXV WLSV %HFDXVH EXVER\V ZHUH SDLG PRUH SHU KRXU
GHOD9HJD EHOLHYHG WKH MREV ZHUH WKH VDPH LQ WHUPV RI 'HIHQGDQW FRQWLQXHV WR PLVFKDUDFWHUL]H WKH UHFRUG LQ DQ
FRPSHQVDWLRQ+RZHYHUGHOD9HJD¶VDYHUPHQWLVEDVHGRQ HIIRUWWRVXSSRUWLWVFRQWHQWLRQWKDW3ODLQWLIIFRXOGQRWNHHSXS
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
ZHUHQRWJRLQJWREHFXWDVDUHVXOWRI3ODLQWLII¶VHPSOR\PHQW VSHFXODWLRQ LQDVPXFK 'HIHQGDQW IDLOHG WR PDUVKDO DQ\
WKDW'HIHQGDQWEHJDQWRDOOHJHWKDW3ODLQWLIIFRXOGQRWNHHSXS HYLGHQFHDVWRKRZPXFKPRQH\3ODLQWLIIPDGHLQWLSVLQDQ
ZLWKWKHSDFH,QDGGLWLRQ3ODLQWLIIZDVWKHRQO\EODFNVHUYHU DYHUDJH GD\ RU KRZ PXFK PRQH\ DQ\ VHUYHU ZRUNLQJ IRU
WR WUDQVIHU WR +LJKODQG +HLJKWV RQO\ RQH RWKHU VHUYHU DW 'HIHQGDQWPDNHVRQWKHDYHUDJH%HFDXVH3ODLQWLIIZRXOG
+LJKODQG+HLJKWVZDVEODFN DQGWKHRWKHUVHUYHUVUHFHLYHG ORVHWKHDELOLW\WRPDNHWLSVDVDEXVER\LWLVUHDVRQDEOHWR
EHWWHUKRXUVDQGVHFWLRQVWKDQ3ODLQWLII8QGHUWKHVHIDFWVD FRQFOXGHWKDWVKHZRXOGKDYHVXIIHUHGDUHGXFWLRQLQVDODU\E\
UHDVRQDEOH SHUVRQ FRXOG FRQFOXGH WKDW 'HIHQGDQW WRRN FKDQJLQJWRWKLVMREFODVVLILFDWLRQ
FDOFXODWHGHIIRUWVWRSRUWUD\3ODLQWLIIDVEHLQJDSRRUVHUYHU
DQG KXPLOLDWHG 3ODLQWLII LQWR UHVLJQLQJ EHFDXVH VKH ZDV D 6LPLODUO\ D FRPPRQ VHQVH XQGHUVWDQGLQJ WKLV W\SH RI
EODFNVHUYHUZKRZDVDFWXDOO\YHU\JRRGDWKHUMREDQGSRVHG UHVWDXUDQW ZRXOG OHDG D UHDVRQDEOH SHUVRQ WR EHOLHYH WKDW
DWKUHDWWRKHUZKLWHFRXQWHUSDUWV6HH6W0DU\¶V+RQRU&WU 3ODLQWLII¶VMREUHVSRQVLELOLWLHVZHUHUHGXFHGE\FKDQJLQJKHU
86DW MREIURPWKDWRIVHUYHUWREXVER\$V3ODLQWLIIWHVWLILHGWKH
EXVER\VZHDUUXEEHUERRWVPRSIORRUVFOHDUDQGOLIWKHDY\
:HDUHIXUWKHUSHUVXDGHGLQWKLVUHJDUGE\WKHWLPLQJRIWKH GLVKHVDQGFOHDQXSDIWHUSHRSOH ZKLOHWKHVHUYHUVZDLWRQ
HYHQWVLQTXHVWLRQ6SHFLILFDOO\LWLVXQGLVSXWHGWKDWDIWHUWHQ FXVWRPHUVDQGGHOLYHUIRRGWRWKHP0RUHRYHU'HIHQGDQW
VXFFHVVIXO\HDUVRIHPSOR\PHQWZLWK'HIHQGDQWDVDVHUYHU DGPLWWHG WKDW LW ZDV FKDQJLQJ 3ODLQWLII¶V MRE FODVVLILFDWLRQ
3ODLQWLIIEHJDQZRUNLQJDVDVHUYHUDWWKH+LJKODQG+HLJKWV EHFDXVH RI 'HIHQGDQW¶V DOOHJHG SHUFHSWLRQ RI 3ODLQWLII QRW
IDFLOLW\RQ0DUFK DQGWKDWZLWKLQWZRZHHNVVKH EHLQJDEOHWRVDWLVIDFWRULO\SHUIRUPDVDVHUYHUDQGWKHGXWLHV
UHFHLYHGDQ³DERYHVWDQGDUGV´SHUIRUPDQFHHYDOXDWLRQDQGD RIDEXVER\ZHUHOHVVWKDQWKRVHRIDVHUYHU
SD\LQFUHDVHW@KHWLWOHUHIHUVWR DQG WKDWWKHVWDWHGUHDVRQZDVLQVXIILFLHQWWRH[SODLQWKH
µ6HFWLRQ
ZKLFKLVWKHEDVLVIRUGLVFKDUJHDVDPHQWDOFDVH´ GHIHQGDQW¶V DFWLRQ 6HH :KHHOHU )G DW ³$
$OWKRXJK WKH XVH RI WKLV WHUP PD\ EH FRLQFLGHQWDO DQ UHDVRQFDQQRWEHSURYHGWREHµDSUHWH[WIRUGLVFULPLQDWLRQ¶
LQIHUHQFH RI LQWHQGHG KXPLOLDWLRQ FDQ EH GUDZQ ZKHUH XQOHVV LW LV VKRZQ ERWK WKDW WKH UHDVRQ ZDV IDOVH DQG WKDW
'HIHQGDQWFRXOGKDYHXVHGVHYHUDORWKHUPHWKRGVRUILFWLWLRXV GLVFULPLQDWLRQZDVWKHUHDOUHDVRQ´6W0DU\¶V+RQRU&WU
VHFWLRQQXPEHUVDVDPHDQVWRGUDZ3ODLQWLIIWRWKHPDQDJHU¶V 86DW
RIILFHEHIRUHKHUVKLIW,QVWHDG'HIHQGDQWHQJDJHGLQDIRUP
RIVXVSHFWWULFNHU\ZKLFKLQLWVHOIZRXOGSODFH3ODLQWLIILQD 'HIHQGDQWFRQWHQGVWKDWLWVGLVFLSOLQDU\DFWLRQWDNHQDJDLQVW
KXPLOLDWHG VWDWH VXFK WKDW 3ODLQWLII ZRXOG EH HYHQ PRUH 3ODLQWLIIZDVQHFHVVDU\EDVHGRQDOOHJHGFRPSODLQWVWKDWLW
YXOQHUDEOH DQG WKHUHIRUH OLNHO\ WR UHVLJQ ZKHQ GHOD9DJD UHFHLYHGIURPFXVWRPHUVUHJDUGLQJ3ODLQWLII¶VSHUIRUPDQFH
GHOLYHUHGWKHQHZV WKH5HSRUWDQG3RSOLQ¶VREVHUYDWLRQRI3ODLQWLII+RZHYHU
OLNHWKH(35'HIHQGDQWKDVIDLOHGWRSURGXFHDQ\RIWKHVH
,QDGGLWLRQRQFHLQWKHRIILFH3ODLQWLIIZDVWRWDOO\EOLQG DOOHJHGFXVWRPHUFRPSODLQWVRUDQ\HYLGHQFHWKDW3ODLQWLII
VLGHGE\ZKDWGHOD9HJDKDGWRVD\$FFRUGLQJWR3ODLQWLII ZDV FRXQVHOHG DERXW WKHP EHIRUH WKH $SULO LQFLGHQW
XVXDOO\VHUYHUVZHUH³ZULWWHQXS´IRUSRRUVKRSSHUUHSRUWV 3ODLQWLIIRQWKHRWKHUKDQGKDVFRPHIRUZDUGZLWKVXIILFLHQW
DQGVKHKDGQHYHUKHDUGRIDQ\RWKHUVHUYHUEHLQJGHPRWHGIRU HYLGHQFHWRHVWDEOLVKWKDW'HIHQGDQW¶VSURIIHUHGUHDVRQIRUKHU
VXFKDUHSRUW)XUWKHUPRUHGHOD9HJDGLGQRWH[SODLQWKDWWKLV GLVFKDUJH±KHUSRRUSHUIRUPDQFHGXHWRLQDELOLW\WRZRUNDW
MRE FKDQJH ZDV WHPSRUDU\ QRU ZDV GHOD9HJD UHFHSWLYH WR DIDVWHUSDFHGIDFLOLW\±ZDVDSUHWH[WIRUUDFHGLVFULPLQDWLRQ
3ODLQWLII¶VRIIHUWRJHWIXUWKHUWUDLQLQJ$FFHSWLQJ3ODLQWLII¶V )RU H[DPSOH 3ODLQWLII DGGXFHG QXPHURXV IDYRUDEOH
YHUVLRQRIWKHHYHQWVDVZHPXVWDWWKLVVWDJHZHFRQFOXGH SHUIRUPDQFH DSSUDLVDOV IURP WKH 1RUWK 5DQGDOO IDFLOLW\ DV
WKDWDUHDVRQDEOHSHUVRQVWDQGLQJLQ3ODLQWLII¶VVKRHVZRXOG ZHOODVXQUHIXWHGWHVWLPRQ\WKDWKHUPDQDJHUDW1RUWK5DQGDOO
KDYH IHOW HPEDUUDVVHG DQG KXPLOLDWHG DW WKH SURVSHFW RI HQFRXUDJHG 3ODLQWLII WR WUDQVIHU WR WKH +LJKODQG +HLJKWV
KDYLQJ WR EXV WDEOHV IRU WKH VHUYHUV ZLWK ZKRP VKH RQFH IDFLOLW\EHFDXVHLWZDVDIDVWHUSDFHGEUDQFK DQGXQUHIXWHG
ZRUNHG±SDUWLFXODUO\ZKHQDOOEXWRQHRIWKHVHUYHUVZHUH WHVWLPRQ\WKDWWKHPDQDJHUDW+LJKODQG+HLJKWV-RKQ+DODV]
&DXFDVLDQ ZKR DW RQH WLPH PDQDJHG WKH 1RUWK 5DQGDOO IDFLOLW\ WROG
3ODLQWLII WKDW KH ZRXOG EH KRQRUHG WR KDYH KHU WUDQVIHU WR
7KLVOHDGVWRWKHILQDOUHOHYDQWIDFWRUZKHWKHU'HIHQGDQW +LJKODQG+HLJKWV6KHDOVRDGGXFHGWKHXQUHIXWHGFODLPWKDW
RIIHUHG 3ODLQWLII FRQWLQXHG HPSOR\PHQW RQ WHUPV OHVV VKHUHFHLYHGDIDYRUDEOHSHUIRUPDQFHUHYLHZDQGSD\LQFUHDVH
IDYRUDEOH WKDQ WKH HPSOR\HH¶V IRUPHU VWDWXV $JDLQ LW LV VKRUWO\DIWHUDUULYLQJDW+LJKODQG+HLJKWV,WZDVQRWXQWLO
FRPSOHWHO\ UHDVRQDEOH WR FRQFOXGH WKDW FOHDULQJ GLVKHV PDQDJHPHQWDQGWKHRWKHUVHUYHUVEHJDQPDNLQJGLVSDUDJLQJ
ZLSLQJERRWKVDQGWDEOHVPRSSLQJIORRUVDQGFOHDQLQJXS FRPPHQWV DQG PDGH WKHLU IHHOLQJV NQRZQ WKDW WKHLU KRXUV
/RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF
WK &LU FDXWLRQLQJ WKDW WKH ³VLPLODUO\ DIWHUFXVWRPHUVIRUPLQLPXPZDJHLVDOHVVIDYRUDEOHMREWKDQ
VLWXDWHG´LQTXLU\VKRXOGQRW³LQYLWHDFRPSDULVRQEHWZHHQWKH EHLQJDVHUYHUIRUDQKRXUO\UDWHDQGWLSV$FFRUGLQJO\ZKHQ
HPSOR\PHQW VWDWXV RI WKH SODLQWLII DQG RWKHU HPSOR\HHV LQ YLHZLQJ WKHVH IDFWRUV LQ FRPELQDWLRQ ZH ILQG WKDW
HYHU\VLQJOHDVSHFWRIWKHLUHPSOR\PHQW ´UDWKHUWKHLQTXLU\ 'HIHQGDQW¶V DFW RI FRQGLWLRQLQJ 3ODLQWLII¶V FRQWLQXHG
VKRXOGIRFXVRQZKHWKHUWKHSODLQWLII¶VHPSOR\PHQWVWDWXVLV HPSOR\PHQWRQKHUEHFRPLQJDEXVER\FUHDWHGDQLQWROHUDEOH
³VLPLODULQDOORIWKHUHOHYDQWDVSHFWV´ ,QRWKHUZRUGVRQFH ZRUN FRQGLWLRQ VXFK WKDW D UHDVRQDEOH SHUVRQ VWDQGLQJ LQ
3ODLQWLIIWUDQVIHUUHGWRWKH+LJKODQG+HLJKWVIDFLOLW\VKHZDV 3ODLQWLII¶VVKRHVZRXOGKDYHIHOWFRPSHOOHGWRUHVLJQ6HH
LQWKHVDPHSRVLWLRQDVKHUZKLWHFRXQWHUSDUWV LQGHHGVKH 0RRUH)GDW
ZDV KHOG WR WKH VDPH SHUIRUPDQFH VWDQGDUGV DV KHU ZKLWH
FRXQWHUSDUWV +RZHYHU TXHVWLRQV RI IDFW UHPDLQ DV WR $OWKRXJK ZH EHOLHYH WKDW WKH $SULO LQFLGHQW ZDV
ZKHWKHUVKHZDVWUHDWHGOHVVIDYRUDEO\WKDQWKHQRQPLQRULW\ VXIILFLHQWWRPHHWWKHILUVWSURQJRIWKHFRQVWUXFWLYHGLVFKDUJH
VHUYHUV LQTXLU\ZHDUHIXUWKHUSHUVXDGHGLQWKLVUHJDUGLQDVPXFKDV
WKH $SULO LQFLGHQW FDPH RQ WKH KHHOV RI 3ODLQWLII
)RUH[DPSOH3ODLQWLIIFODLPVWKDWLQKHUPRUHWKDQWHQ\HDUV H[SHULHQFLQJGLVSDUDJLQJFRPPHQWVDQGDOOHJHGLQFLGHQWVRI
RIHPSOR\PHQWZLWK'HIHQGDQWDOWKRXJKVKHKDGVHHQRWKHU XQIDLUWUHDWPHQW6HH-DFNVRQY4XDQH[ )G
VHUYHUV ³ZULWWHQ XS´ IRU XQIDYRUDEOH 0\VWHU\ 6KRSSHU WK&LU QRWLQJWKDWDFODLPIRUUDFHGLVFULPLQDWLRQ
5HSRUWVVKHNQHZRIQRRWKHUVHUYHUVZKRZHUHUHTXLUHGWR PXVWEHYLHZHGXQGHUWKHWRWDOLW\RIWKHFLUFXPVWDQFHV $V
EHFRPH EXVER\V LI WKH\ ZLVKHG WR FRQWLQXH ZLWK WKHLU VWDWHGVKRUWO\DIWHUWUDQVIHUULQJWR+LJKODQG+HLJKWV3ODLQWLII
HPSOR\PHQW,QDGGLWLRQDVLGHIURPRQHRWKHUVHUYHUZKR FODLPV WKDW VKH EHJDQ H[SHULHQFLQJ FRPPHQWV IURP
ZDV HPSOR\HG SDUWWLPH 3ODLQWLII ZDV WKH RQO\ $IULFDQ PDQDJHPHQWDQGFRZRUNHUVVXFKDV³:HGRQ¶WVHUYHµJULWV¶
$PHULFDQVHUYHUDQGVKHFODLPVWKDWWKHZKLWHVHUYHUVZHUH KHUH ´ ³3ODLQWLII@WRTXLW´,WLVFRPSOHWHO\ JHQXLQHLVVXHRIIDFWIRUWULDOWKDWQRQPLQRULW\FRZRUNHUV
IRUHVHHDEOH WKDW D UHDVRQDEOH SHUVRQ ZRXOG KDYH UHVLJQHG ZHUHWUHDWHGPRUHIDYRUDEO\WKDQ3ODLQWLIILQDVPXFKDVWKH
XQGHU WKHVH FLUFXPVWDQFHV 6HH LG ILQGLQJ WKDW WKH FRZRUNHUV WR ZKRP 3ODLQWLII PDNHV UHIHUHQFH ZHUH QRW
GHIHQGDQW¶VDFWRILQFUHDVLQJO\LVRODWLQJWKHSODLQWLIIDQGQRW VHUYHUV ZKR WUDQVIHUUHG IURP RWKHU IDFLOLWLHV :H DUH QRW
FRPPXQLFDWLQJ ZLWK KLP DIWHU WKH SODLQWLII ILOHG DQ ((2& SHUVXDGHG E\ 'HIHQGDQW¶V FODLP EHFDXVH RQFH 3ODLQWLII
FRPSODLQWZDVVXIILFLHQWHYLGHQFHIRUDMXU\WRFRQFOXGHWKDW WUDQVIHUUHGWRWKH+LJKODQG+HLJKWVIDFLOLW\VKHERUHWKHVDPH
WKHGHIHQGDQWLQWHQGHGIRUWKHSODLQWLIIWRUHVLJQ ³>G@D\DIWHU MREWLWOHDQGZDVUHTXLUHGWRSHUIRUPWKHVDPHGXWLHVIRUWKH
GD\ ZHHN DIWHU ZHHN RI LVRODWLRQ ZRXOG OHDG KLP WR VDPHPDQDJHUVDVWKHVHUYHUVZKRKDGDOUHDG\ZRUNHGWKHUH
EHOLHYHWKDWKHZDVQRORQJHUZDQWHG´ ,QGHHG'HIHQGDQW¶V 6HH(UFHJRYLFKY*RRG\HDU7LUH 5XEEHU&R)G
