Elawyers Elawyers
Washington| Change

Greer v. Mitchell, 98-4330 (2001)

Court: Court of Appeals for the Sixth Circuit Number: 98-4330 Visitors: 1
Filed: Sep. 04, 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 3$8/ : *5((5 ; 3HWLWLRQHU$SSHOODQW    1R Y  !  %(77 W@KH WULDO FRXUWjV GLVSDUDWH $6WDQGDUGRI5HYLHZ WUHDWPHQWRI0U5RWKjVVWDWHPHQWVZDVVRXQIDLUDQGELDVHG DVWRGHQ\0U*UHHUKLVULJKWRIGXHSURFHVVDVJXDUDQWHHGE\ 7KLVFRXUWUHYLHZVDGLVWULFWFR
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 3$8/ : *5((5 ; 3HWLWLRQHU$SSHOODQW    1R Y  !  %(77 W@KH WULDO FRXUWjV GLVSDUDWH $6WDQGDUGRI5HYLHZ WUHDWPHQWRI0U5RWKjVVWDWHPHQWVZDVVRXQIDLUDQGELDVHG DVWRGHQ\0U*UHHUKLVULJKWRIGXHSURFHVVDVJXDUDQWHHGE\ 7KLVFRXUWUHYLHZVDGLVWULFWFRXUWjVOHJDOFRQFOXVLRQVLQD WKH)LIWKDQG)RXUWHHQWK$PHQGPHQWVl+RZHYHUDVDOUHDG\ KDEHDVSURFHHGLQJGHQRYRDQGLWVIDFWXDOILQGLQJVIRUFOHDU QRWHG KLV RQO\ H[DPSOHV RI WKLV ELDV DUH FXOOHG IURP WKH HUURU6HH/XFDVY2j'HD)G WK&LU  WHVWLPRQ\RI0UV0DORQH %HFDXVHSHWLWLRQHUILOHGKLVKDEHDVSHWLWLRQRQ'HFHPEHU UHYLHZRIWKHVWDWHFRXUWjVGHFLVLRQLVJRYHUQHGE\WKH :HDIILUPWKHGLVWULFWFRXUW VWDQGDUGVVHWIRUWKLQWKH$QWLWHUURULVPDQG(IIHFWLYH'HDWK 3HQDOW\ $FW RI  3XE / 1R   6WDW    $('3$ 6HH/LQGKY0XUSK\86  +DUSVWHUY2KLR)G WK&LU  $VDPHQGHG86&† G SURYLGHVDVIROORZV  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  G $QDSSOLFDWLRQIRUDZULWRIKDEHDVFRUSXVRQEHKDOI WRZQ/RFN\RXUGRRUVWRQLJKWDQGLI5LFNFRPHVRYHU RIDSHUVRQLQFXVWRG\SXUVXDQWWRWKHMXGJPHQWRID6WDWH ,jPJRLQJWRKDYHWRNLOOKLPl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m,I\RXNQRZWKHUHDUHSHRSOH>ZKRZHUHLQGHEWWR5RWK@ 86&† G ,Q:LOOLDPVY7D\ORU86 EULQJWKHPLQl  WKH&RXUWH[SODLQHGWKHHIIHFWRIWKLVVHFWLRQLQWKHVH WHUPV %HIRUHWKH2KLR6XSUHPH&RXUWSHWLWLRQHUKDGFRQWHQGHG WKDWWKHVWDWHPHQWm5LFNLVEDFNLQWRZQlIHOOXQGHU2KLR ,QVXP† G  SODFHVDQHZFRQVWUDLQWRQWKH 5XOHRI(YLGHQFH  ZKLFKSURYLGHVDKHDUVD\H[FHSWLRQ SRZHURIDIHGHUDOKDEHDVFRXUWWRJUDQWDVWDWHSULVRQHUjV IRUVWDWHPHQWVWKDWVKRZDQmH[LVWLQJPHQWDOHPRWLRQDORU DSSOLFDWLRQIRUDZULWRIKDEHDVFRUSXVZLWKUHVSHFWWR SK\VLFDOFRQGLWLRQl7KH&RXUWUHMHFWHGWKLVDUJXPHQW FODLPVDGMXGLFDWHGRQWKHPHULWVLQVWDWHFRXUW8QGHU †  G   WKH ZULW PD\ LVVXH RQO\ LI RQH RI WKH 7KHGHFHGHQWVLPSO\GRHVQRWVWDWHWKDWKHZDVDIUDLGRI IROORZLQJ WZR FRQGLWLRQV LV VDWLVILHG  WKH VWDWHFRXUW DQ\RQH,QVRIDUDVWKHUHPD\EH GHULYDWLYHLQIHUHQFHV DGMXGLFDWLRQUHVXOWHGLQDGHFLVLRQWKDW  mZDVFRQWUDU\ IDYRUDEOH WR DSSHOODQW LW PXVW EH DGPLWWHG WKDW WKH\ WRFOHDUO\HVWDEOLVKHG)HGHUDOODZDVGHWHUPLQHGE\ ZRXOGUHTXLUHWKHMXU\WRVSHFXODWHDQGQRWPHUHO\LQIHU WKH 6XSUHPH &RXUW RI WKH 8QLWHG 6WDWHVl RU 6LQFHDSSHOODQWGLGQRWSUHVHQWKLVGHIHQVHXSRQWKHEDVLV  mLQYROYHGDQXQUHDVRQDEOHDSSOLFDWLRQRIFOHDUO\ WKDW 5LFN 0F0LOODQ NLOOHG WKH GHFHGHQW LW FDQQRW EH HVWDEOLVKHG)HGHUDOODZDVGHWHUPLQHGE\WKH6XSUHPH FRQWHQGHGWKDWWKHVWDWHPHQWVZHUHDQ\WKLQJRWKHUWKDQ &RXUW RI WKH 8QLWHG 6WDWHVl  8QGHU WKH mFRQWUDU\ WRl LUUHOHYDQWSRVVHVVLQJDSRWHQWLDOIRUPLVOHDGLQJWKHMXU\ FODXVHDIHGHUDOKDEHDVFRXUWPD\JUDQWWKHZULWLIWKH VWDWH FRXUW DUULYHV DW D FRQFOXVLRQ RSSRVLWH WR WKDW *UHHU2KLR6WGDW1(GDW UHDFKHGE\WKLV&RXUWRQDTXHVWLRQRIODZRULIWKHVWDWH FRXUWGHFLGHVDFDVHGLIIHUHQWO\WKDQWKLV&RXUWKDVRQD 7KH GLVWULFW FRXUW OLNHZLVH UHMHFWHG SHWLWLRQHUjV FODLP VHW RI PDWHULDOO\ LQGLVWLQJXLVKDEOH IDFWV 8QGHU WKH DOWKRXJK RQ VRPHZKDW GLIIHUHQW JURXQGV JLYHQ WKH KDEHDV mXQUHDVRQDEOHDSSOLFDWLRQlFODXVHDIHGHUDOKDEHDVFRXUW FRQWH[W PD\JUDQWWKHZULWLIWKHVWDWHFRXUWLGHQWLILHVWKHFRUUHFW JRYHUQLQJOHJDOSULQFLSOHIURPWKLV&RXUWjVGHFLVLRQVEXW ,WLVDORQJVWDQGLQJSULQFLSOHWKDWIHGHUDOFRXUWVDUHWR XQUHDVRQDEO\ DSSOLHV WKDW SULQFLSOH WR WKH IDFWV RI WKH JLYHGHIHUHQFHWRVWDWHWULDOFRXUWGHFLVLRQVUHJDUGLQJWKH SULVRQHUjVFDVH DSSOLFDWLRQRIVWDWHODZ6SHFLILFDOO\FODLPVEDVHGXSRQ  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  RSLQLRQ RI WKH WULDO FRXUW LV FRPSOHWHO\ GHYRLG RI DQ\ 86DW 2j&RQQRUs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jVUXOLQJVRQ KHDUVD\REMHFWLRQVZHUHVLJQLILFDQWHQRXJKWRLPSOLFDWHWKH $ WKHFODLPUHOLHVRQ &RQIURQWDWLRQ&ODXVH7KHVHREMHFWLRQVRFFXUUHGGXULQJWKH WHVWLPRQ\RI0UV0DORQHDQHLJKERUZLWKZKRP0U5RWK L  D QHZ UXOH RI FRQVWLWXWLRQDO ODZ PDGH KDGGLQHGRQWKHHYHQLQJRIKLVPXUGHU UHWURDFWLYH WR FDVHV RQ FROODWHUDO UHYLHZ E\ WKH 6XSUHPH&RXUWWKDWZDVSUHYLRXVO\XQDYDLODEOHRU 7KHSURVHFXWLRQHOLFLWHGIURP0UV0DORQHWKDW0U5RWK LQWHQGHG WR HYLFW SHWLWLRQHU  +RZHYHU D UHYLHZ RI WKH LL DIDFWXDOSUHGLFDWHWKDWFRXOGQRWKDYHEHHQ UHOHYDQW SRUWLRQ RI WKH WUDQVFULSW UHYHDOV WKDW DOWKRXJK WKH SUHYLRXVO\GLVFRYHUHGWKURXJKWKHH[HUFLVHRIGXH WULDO FRXUW RYHUUXOHG WKH REMHFWLRQ 0UV 0DORQH ZDV GLOLJHQFHDQG LQVWUXFWHGWKDWKHUWHVWLPRQ\PXVWmEHRI\RXURZQSHUVRQDO NQRZOHGJHl % WKHIDFWVXQGHUO\LQJWKHFODLPZRXOGEHVXIILFLHQW WRHVWDEOLVKE\FOHDUDQGFRQYLQFLQJHYLGHQFHWKDWEXWIRU 6HFRQGGXULQJDFRQIHUHQFHLQFKDPEHUVGHIHQVHFRXQVHO FRQVWLWXWLRQDOHUURUQRUHDVRQDEOHIDFWILQGHUZRXOGKDYH LQGLFDWHG WKDW WKH\ ZLVKHG WR SXUVXH WKH IROORZLQJ OLQH RI IRXQGWKHDSSOLFDQWJXLOW\RIWKHXQGHUO\LQJRIIHQVH LQTXLU\ 86&† H :LWKWKHVHSUHFHSWVLQPLQGZHWXUQWR :H NQRZ WKDW 5LWD 0DORQH PDGH D VWDWHPHQW WR DQ WKHYH[LQJGRFWULQHRISURFHGXUDOGHIDXOW LQYHVWLJDWLQJRIILFHUZKHUHLQVKHVWDWHGWKDWVKHNQHZRQ WKHWKoVKHKDGDFRQYHUVDWLRQZLWK5RWKDQG5RWK WROG KHU TXRWH ZRUGV WR WKLV HIIHFW m5LFN LV EDFN LQ  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  %3URFHGXUDO'HIDXOW LLQVWUXFWLRQVWKDWWKHWULDOFRXUWVKRXOGKDYHJLYHQ $VZLWKYLUWXDOO\DOOFDSLWDOFDVHVSHWLWLRQHUFKDOOHQJHVWKH 3HWLWLRQHUFRQFOXGHVE\DUJXLQJWKDWWKHWULDOFRXUWIDLOHGWR GLVWULFWFRXUWj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jV 3HWLWLRQHU FRQWHQGV WKDW WKH WULDO FRXUW UHFHLYHG D YLFWLP 0DXSLQGHFLVLRQVHWVRXWIRXULQTXLULHVWKDWDGLVWULFWFRXUW LPSDFWVWDWHPHQWLQYLRODWLRQRIWKH(LJKWK$PHQGPHQW%XW VKRXOGPDNHZKHQWKHVWDWHDUJXHVWKDWDKDEHDVFODLPKDV VHH 3D\QH Y 7HQQHVVHH  86    RYHUUXOLQJ EHHQ GHIDXOWHG E\ SHWLWLRQHUjV IDLOXUH WR REVHUYH D VWDWH HDUOLHUSUHFHGHQWDQGKROGLQJWKDWYLFWLPLPSDFWVWDWHPHQWV SURFHGXUDOUXOH)LUVWWKHFRXUWPXVWGHWHUPLQHZKHWKHUWKHUH FDQSOD\DUROHLQWKHVHQWHQFLQJSKDVHRIDFDSLWDOWULDO 7KLV LV VXFK D SURFHGXUDO UXOH WKDW LV DSSOLFDEOH WR WKH FODLP DW VWDWHPHQWZDVQHYHUVKRZQWRWKHMXU\DQGQRZKHUHGRHVWKH LVVXHDQGZKHWKHUWKHSHWLWLRQHUGLGLQIDFWIDLOWRIROORZLW WULDO FRXUW UHIHU WR LW DV SOD\LQJ D UROH LQ WKH LPSRVLWLRQ RI 0DXSLQ  )G DW   6HFRQG WKH FRXUW PXVW GHFLGH SHWLWLRQHUjVVHQWHQFH ZKHWKHU WKH VWDWH FRXUWV DFWXDOO\ HQIRUFHG LWV SURFHGXUDO VDQFWLRQ,G7KLUGWKHFRXUWPXVWGHFLGHZKHWKHUWKHVWDWHjV 3HWLWLRQHUILUVWUDLVHGWKLVLVVXHLQKLVGLUHFWDSSHDOWRWKH SURFHGXUDO IRUIHLWXUH LV DQ mDGHTXDWH DQG LQGHSHQGHQWl 2KLR 6XSUHPH &RXUW ZKLFK UHMHFWHG WKH FODLP IRU WKHVH JURXQGRQZKLFKWKHVWDWHFDQUHO\WRIRUHFORVHUHYLHZRID UHDVRQV IHGHUDO FRQVWLWXWLRQDO FODLP  m7KLV TXHVWLRQ ZLOO XVXDOO\ LQYROYHDQH[DPLQDWLRQRIWKHOHJLWLPDWHVWDWHLQWHUHVWVEHKLQG $SSHOODQW DOVRDVVHUWVLQSURSRVLWLRQRIODZQXPEHU WKH SURFHGXUDO UXOH LQ OLJKW RI WKH IHGHUDO LQWHUHVW LQ ILIWHHQWKDWDYLFWLPLPSDFWVWDWHPHQWZDVXWLOL]HGLQWKH FRQVLGHULQJIHGHUDOFODLPVl,G$QGIRXUWKWKHSHWLWLRQHU WULDOFRXUWjVVHQWHQFLQJFRQVLGHUDWLRQVLQYLRODWLRQRIWKH PXVWGHPRQVWUDWHFRQVLVWHQWZLWK:DLQZULJKWY6\NHV UHFHQWSURQRXQFHPHQWFRQWDLQHGLQ%RRWKY0DU\ODQG 86  WKDWWKHUHZDVmFDXVHlIRUKLPWRQHJOHFWWKH  866&W/(GG SURFHGXUDO UXOH DQG WKDW KH ZDV DFWXDOO\ SUHMXGLFHG E\ WKH 7KLVSURSRVLWLRQRIODZZDVQHLWKHUEULHIHGQRUDUJXHG DOOHJHGFRQVWLWXWLRQDOHUURU,GVHHDOVR6FRWWY0LWFKHOO EHIRUHWKHFRXUWRIDSSHDOV,WLVDFFRUGLQJO\ZDLYHGDQG  )G   WK &LU  FHUW GHQLHG  6&W  RXUFRQVLGHUDWLRQWKHUHRILVEDUUHGE\WKHGRFWULQHRIUHV   MXGLFDWD )XUWKHUPRUHHYHQZKHQDSHWLWLRQHUIDLOV WRVKRZFDXVH %\ZD\RIFRPPHQWDU\RQO\ZHQRWHWKDWWKHUHSRUWDW DQG SUHMXGLFH D FRXUW PXVW VWLOO FRQVLGHU ZKHWKHU VSHFLDO LVVXH ZDV SUHSDUHG  +RZHYHU DW QR WLPH ZDV LW HYHU FLUFXPVWDQFHV UHTXLUH WKDW WKDW VKRZLQJ EH ZDLYHG HQWHUHG LQWR HYLGHQFH  ,W ZDV QRW JLYHQ WR WKH MXU\ RU 6SHFLILFDOO\DFRXUWPD\QRWLFHDQRWKHUZLVHGHIDXOWHGFODLP VSHFLILFDOO\ FRPPHQWHG XSRQ LQ WKHLU SUHVHQFH  7KH LI LW FRQFOXGHV WKDW SHWLWLRQHU KDV VKRZQ E\ FOHDU DQG FRQYLQFLQJ HYLGHQFH WKDW EXW IRU FRQVWLWXWLRQDO HUURU QR  7KH 6XSUHPH &RXUW H[SOLFLWO\ RYHUUXOHG %RRWK LQ 3D\QH VXSUD  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  HV\PSDWK\LQVWUXFWLRQ UHDVRQDEOHMXURUZRXOGKDYHIRXQGKLPJXLOW\RIWKHFULPHRU LIWKHFRQVWLWXWLRQDOHUURURFFXUUHGGXULQJWKHSHQDOW\SKDVHRI 7KHFRXUWDOVRWROGWKHMXU\m Z@KHWKHU D VWDWH FRXUW UHVWHG LWV KROGLQJ RQ SURFHGXUDO GHIDXOW VR DV WR EDU IHGHUDO KDEHDV UHYLHZ LV D JXQDQLPLW\LQVWUXFWLRQ TXHVWLRQRIODZWKDWZHUHYLHZGHQRYRl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j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s$ DW    7KH GLVWULFW FRXUW DJUHHG ZLWK WKLV 3HQDOW\3KDVH,QVWUXFWLRQV UHDVRQLQJ0HPRUDQGXPRI2SLQLRQ$XJXVWDW  s$DW  DEXUGHQRISURRILQVWUXFWLRQ 7KHGLVWULFWFRXUWj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jVSHUVRQDOKLVWRU\ 7KH'HIHQGDQWVKDOOKDYHWKHEXUGHQRIJRLQJIRUZDUG DQGFKDUDFWHULQDIDYRUDEOHFRQWH[W/DUU\'HKXVDQH[SHUW ZLWK HYLGHQFH RI DQ\ IDFWRUV LQ PLWLJDWLRQ RI WKH ZKR ZRXOG KDYH GLVSXWHG WKH VWDWHjV HYLGHQFH UHJDUGLQJ LPSRVLWLRQRIWKHVHQWHQFHRIGHDWK EORRG\ IRRWSULQWV IRXQG QHDU WKH YLFWLPjV ERG\ sDPHV (LVHQEHUJ D SV\FKRORJLVW ZKR ZRXOG KDYH WHVWLILHG 1RREMHFWLRQZDVPDGHE\FRXQVHO1RWRQO\GRZHILQGQR FRQFHUQLQJWKHVKRUWFRPLQJVRIWULDOFRXQVHOVjSUHSDUDWLRQIRU HUURUZLWKWKLVLQVWUXFWLRQLWKDVEHHQSURFHGXUDOO\GHIDXOWHG PLWLJDWLRQWULDOFRXQVHOZKRLQGLFDWHWKDWWKHLUQRWHVUHYHDO WKDWFHUWDLQMXURUVH[FXVHGE\WKHSURVHFXWLRQZHUHEODFNDQG EQRQELQGLQJQDWXUHRIMXU\UHFRPPHQGDWLRQ DMXURUZKRVWDWHVWKDWHYLGHQFHRISHWLWLRQHUjVEDFNJURXQG ZRXOGKDYHmEHHQKHOSIXODQGPD\KDYHDIIHFWHGWKHMXU\jV 3HWLWLRQHU REMHFWV WR WKLV LQVWUXFWLRQ m$ MXU\ GHFLVLRQl UHFRPPHQGDWLRQ WR WKH &RXUW WKDW WKH GHDWK SHQDOW\ EH LPSRVHGLVMXVWWKDWDUHFRPPHQGDWLRQDQGLWLVQRWELQGLQJ XSRQWKH&RXUW7KHILQDOGHFLVLRQDVWRZKHWKHUWKHGHDWK SHQDOW\VKDOOEHLPSRVHGXSRQWKH'HIHQGDQWUHVWVXSRQWKH  &RXUWl3HWLWLRQHUFRQWHQGVWKDWWKLVLQVWUXFWLRQUXQVDIRXORI 7KH SRVWFRQYLFWLRQ SHWLWLRQ ZDV ILOHG E\ 6FRWW s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mXQPLVWDNDEO\ 7KHJLVWRI*UHHUjVFODLPLVWKDWKLVUHSUHVHQWDWLRQZDV FOHDUl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jVSRVLWLRQWKDWWKHFRXUW 2FW    s$ DW   FLWDWLRQV RPLWWHG  PXVWSUHFLVHO\SKUDVHLWVLQVWUXFWLRQVWRDSRWHQWLDOMXURUWR $OWKRXJKFRXQVHOFRXOGFHUWDLQO\KDYHUDLVHGDQLQHIIHFWLYH LQFOXGHWKHZRUGmFRQVLGHUl,QRXUYLHZWKHFRXUWIROORZHG DVVLVWDQFH RI FRXQVHO FODLP RQ GLUHFW DSSHDO WKH SUHFLVH WKHFRUUHFWVWDQGDUGLWDWWHPSWHGWRGLVFHUQGXULQJYRLUGLUH DUJXPHQWVDGYDQFHGLQKLVSHWLWLRQIRUSRVWFRQYLFWLRQUHOLHI ZKHWKHUDSURVSHFWLYHMXURUFRXOGIROORZWKHODZZLWKUHVSHFW UHTXLUHVLJQLILFDQWVXSSOHPHQWDWLRQRIWKHWULDOFRXUWUHFRUG WRWKHGHDWKSHQDOW\ 7KH 2KLR &RXUW RI $SSHDOV UHOLHV RQ D VLQJOH XQUHSRUWHG FDVH6WDWHY:D\QH:/ 2KLR&W$SS6HSW )sXU\,QVWUXFWLRQV  WRVXSSRUWLWVVWDWHPHQWWKDWmHYLGHQFHLVQRWRXWVLGH WKH UHFRUG VLPSO\ EHFDXVH LW ZDV QRW UDLVHG LQ WKH RULJLQDO 3HWLWLRQHUUDLVHVQXPHURXVFKDOOHQJHVWRMXU\LQVWUXFWLRQV SURFHHGLQJl ,@IWKHMXU\ILQGVWKH6WDWHGLGSURYHEH\RQGDUHDVRQDEOH DSSHDOl 1HYHUWKHOHVVZKHQWKHUHFRUGUHYHDOVWKDWWKHVWDWH GRXEW WKH DJJUDYDWLQJ IDFWRUV RXWZHLJK WKH PLWLJDWLQJ FRXUWjV UHOLDQFH XSRQ LWV RZQ UXOH RI SURFHGXUDO GHIDXOW LV IDFWRUV\RXZLOOWKHQEHUHTXLUHGWRUHFRPPHQGWRWKH PLVSODFHG ZH DUH UHOXFWDQW WR FRQFOXGH FDWHJRULFDOO\ WKDW &RXUWWKDWWKH'HIHQGDQWUHFHLYHWKHGHDWKVHQWHQFH IHGHUDOKDEHDVUHYLHZRIWKHSXUSRUWHGO\GHIDXOWHGFODLPLV ,I\RXILQG\RXUVHOILQWKDWVLWXDWLRQFRXOG\RXPDNH SUHFOXGHG$VH[SODLQHGEHORZKRZHYHUZHQHHGQRWGHFLGH VXFK D UHFRPPHQGDWLRQ WR WKH &RXUW"  7KDW WKHH[WHQWWRZKLFKLIDQ\IHGHUDOFRXUWVPD\UHDFKWKHPHULWV UHFRPPHQGDWLRQ EHLQJ FRXOG \RX PDNH WKH RIFRQVWLWXWLRQDOFODLPVWKDWDVWDWHFRXUWLPSURSHUO\IRXQGWR UHFRPPHQGDWLRQ WKDW WKH 'HIHQGDQW UHFHLYH WKH GHDWK EH SURFHGXUDOO\ GHIDXOWHG EHFDXVH SHWLWLRQHUjV LQHIIHFWLYH SHQDOW\" DVVLVWDQFHRIDSSHOODWHFRXQVHOFODLPQHFHVVDULO\IRUFHVXVWR UHYLHZWKHSHUIRUPDQFHRIWULDOFRXQVHO 3HWLWLRQHU FRQWHQGV WKDW WKH FRXUW PLVVWDWHV WKH VWDQGDUG %,QHIIHFWLYH$VVLVWDQFHRI$SSHOODWH&RXQVHO ZKLFKVKRXOGEHZKHWKHUDMXURUZRXOGFRQVLGHULPSRVLQJWKH GHDWKSHQDOW\2WKHUMXURUVZHUHOLNHZLVHH[FXVHGIRUFDXVH $VWKHGLVWULFWFRXUWUHFRJQL]HGKRZHYHUSHWLWLRQHUj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jV SHUIRUPDQFH ZDV UHTXLUHG LQ RUGHU WR GHWHUPLQH VWDQGDUGLVZKHWKHUWKHMXURUjVYLHZVZRXOGmSUHYHQWRU ZKHWKHU DSSHOODWH FRXQVHO KDG EHHQ FRQVWLWXWLRQDOO\ VXEVWDQWLDOO\LPSDLUWKHSHUIRUPDQFHRIKLVGXWLHVDVD LQHIIHFWLYH0DSHV)GDW MXURULQDFFRUGDQFHZLWKKLVLQVWUXFWLRQVDQGKLVRDWKl )RU WKDW OLPLWHG UHDVRQ ZH QRZ WXUQ WR SHWLWLRQHUjV :H QRWH WKDW LQ DGGLWLRQ WR GLVSHQVLQJ ZLWK DOOHJDWLRQV WKDW KLV WULDO FRXQVHO UHQGHUHG FRQVWLWXWLRQDOO\ :LWKHUVSRRQjVUHIHUHQFHWRmDXWRPDWLFlGHFLVLRQPDNLQJ LQHIIHFWLYHDVVLVWDQFH,IWULDOFRXQVHOSHUIRUPHGDGHTXDWHO\ WKLVVWDQGDUGOLNHZLVHGRHVQRWUHTXLUHWKDWDMXURUjVELDV RXU LQTXLU\ LV DW DQ HQG E\ GHILQLWLRQ DSSHOODWH FRXQVHO EHSURYHGZLWKmXQPLVWDNDEOHFODULW\l7KLVLVEHFDXVH  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  FDQQRWEHLQHIIHFWLYHIRUDIDLOXUHWRUDLVHDQLVVXHWKDWODFNV 'HIHQVHFRXQVHODVNHGIRUWKHFRXUWWRUHVHUYHUXOLQJXQWLOWKH PHULW MXURUFRXOGDVFHUWDLQZKHWKHUVRPHRQHFRXOGUHSODFHKHU7KH FRXUWGHFOLQHGKRZHYHUDQGH[FXVHGWKHMXURUIRUFDXVH *LYHQWKHH[LJHQFLHVDQGFRPSOH[LW\RIFDSLWDOFDVHVLWLV OLNHO\ WKDW HYHQ H[SHULHQFHG WULDO FRXQVHO ZLOO FRPPLW 7KHVHFRQGMXURU%HYHUO\3HRSOHVSUHVHQWHGDQRWHIURP RYHUVLJKWV2IFRXUVHHUURUVRIWDFWLFVRURPLVVLRQGRQRW D GRFWRU VWDWLQJ m6KH  LV VXIIHULQJ ZLWK K\SHUWHQVLRQ DQG QHFHVVDULO\ PHDQ WKDW FRXQVHO KDV IXQFWLRQHG LQ D VKRXOGQRWEHDVNHGWRVHUYHDVDVSHFLDOMXURUDWWKLVWLPH FRQVWLWXWLRQDOO\GHILFLHQWPDQQHUm>,@WLVDOOWRRHDV\IRUD EHFDXVHRIKHUSK\VLFDOFRQGLWLRQl 0UV3HRSOHjVZRUNHG FRXUW H[DPLQLQJ FRXQVHOjV GHIHQVH DIWHU LW KDV SURYHG IRUWKHGRFWRUZKRSURYLGHGWKHOHWWHU 7KHWULDOFRXUWQRWHG XQVXFFHVVIXOWRFRQFOXGHWKDWDSDUWLFXODUDFWRURPLVVLRQRI RQ WKH UHFRUG WKDW WKH GRFWRU FDOOHG WKH FRXUW DQG mZDV FRXQVHO ZDV XQUHDVRQDEOHl  6WULFNODQG  86 DW  FRQFHUQHG WKDW WKH RIILFH LV QRW UXQQLQJ DV VPRRWKO\ DV KH ,QVWHDGWKLV&RXUWPXVWGHWHUPLQHZKHWKHUFRXQVHOPDGHD ZRXOGSUHIHULWLQ0V3HRSOHjVDEVHQFHl mUHDVRQDEOH GHFLVLRQ WKDW PDNHV SDUWLFXODU LQYHVWLJDWLRQ XQQHFHVVDU\l,GDW 'HIHQVHFRXQVHOTXHVWLRQHG0UV3HRSOHVZKRFRQFHGHG WKDWVKHZDVXQGHUDORWRIVWUHVVDWZRUN6KHDOVRDGPLWWHG 3HWLWLRQHUDOOHJHVWKDWWULDOFRXQVHOFRPPLWWHGVHULRXVHUURUV WKDWVKHZRXOGSUHIHUQRWWRVHUYHIRUERWKKHDOWKDQGUHOLJLRXV GXULQJ WKH JXLOW SKDVH RI KLV WULDO  7KHVH DOOHJHG HUURUV UHDVRQV m, MXVW GRQjW IHHO WKDW , VKRXOG EH LQ MXGJPHQW RI LQFOXGH IDLOXUH WR   FRQWDFW SURVSHFWLYH SURVHFXWLRQ VRPHRQHHOVHUHJDUGOHVVRIWKHFULPHl ZLWQHVVHV LQYHVWLJDWHDOOHJDWLRQVWKDWWKHYLFWLPZDVDIUDLG RIDPDQQDPHGm5LFNl REWDLQDQH[SHUWWRFKDOOHQJHWKH 7KHSURVHFXWRUQRWHGWKDWWKHFRXUWKDGDOUHDG\H[FXVHG FRQFOXVLRQVRIWKHFRURQHU GHWHUPLQHZKHWKHUSHWLWLRQHUjV WZRRWKHUMXURUVIRUK\SHUWHQVLRQ2YHUGHIHQVHFRXQVHOjV DOLEL o WKDW KH ZDV ZDWFKLQJ WKH PRYLH m&KLOGUHQ RI WKH REMHFWLRQWKHFRXUWH[FXVHGWKHMXURUIRUPHGLFDOUHDVRQV &RUQl RQ WHOHYLVLRQ o ZDV FUHGLEOH   FRPPXQLFDWH DGHTXDWHO\ZLWKSHWLWLRQHU REMHFWWRWKHFRQGXFWRIYRLU ,QSHWLWLRQHUjVYLHZm*LYHQWKHWUHDWPHQWRIZKLWHMXURUV GLUH   REMHFW WR SURVHFXWRULDO PLVFRQGXFW   UHTXHVW DQ WKHRQO\ORJLFDOH[SODQDWLRQIRUWKHH[FXVDORI0UV5H\QROGV LQVWUXFWLRQIRUWKHOHVVHULQFOXGHGRIIHQVHRIWKHIW REMHFW DQG0UV3HRSOHVLVWKHLUUDFHRUJHQGHUl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jV PDQ\ UHFHQW GHFLVLRQV YDFDWLQJ GHDWK VHQWHQFHV GXH WR  )G  WK &LU LQHIIHFWLYH DVVLVWDQFH 6HH HJ 6NDJJV Y 3DUNHU 3HWLWLRQHU REMHFWV WR WKH IDFW WKDW WKH MXU\ FRPPLVVLRQHU   $EGXUj5DKPDQ Y %HOO  )G   WK &LU  H[FXVHGDSRWHQWLDOMXURUEHIRUHWKHFRXUWRUFRXQVHOKDGDQ GLVVHQW  &DUWHU Y %HOO  )G  WK &LU   %\UG Y &ROOLQV RSSRUWXQLW\ WR TXHVWLRQ KLP EDVHG XSRQ D OHWWHU IURP DQ  )G   WK &LU  GLVVHQW  FHUW GHQLHG  6&W  HPSOR\HU  (YHQ WKRXJK WKLV SURVSHFWLYH MXURUjV UDFH LV   0DSHV VXSUD 5LFNPDQ Y %HOO  )G  WK &LU   XQNQRZQSHWLWLRQHUFRQWHQGVWKDWmWKHWULDOFRXUWjVIDLOXUHWR *URVHFORVH Y %HOO  )G  WK &LU   $XVWLQ Y %HOO  )G  WK &LU   *OHQQ Y 7DWH  )G  WK &LU    *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  SHWLWLRQHUZDVDOORZHGWRLQWURGXFHSHUVRQDOFKDUDFWHULVWLFVLQ 7KHVH DUJXPHQWV QHHG QRW GHWDLQ XV ORQJ EHFDXVH HYHQ PLWLJDWLRQ GRHV QRW PHDQ WKDW WKH SURVHFXWLRQ PD\ QRW DVVXPLQJ WKDW WULDO FRXQVHO ZDV QRW UHDVRQDEO\ HIIHFWLYH mVWURQJO\DQGIRUFHIXOO\DUJXHWKDWVXFKPHUF\QHHGQRWEH SHWLWLRQHU FDQQRW HVWDEOLVK SUHMXGLFH  7KHUH LV DOPRVW QR H[WHQGHG DQG WKDW WKH MXU\ VKRXOG QRW EH URXVHG WR D FKDQFH WKDW WKH YHUGLFW ZRXOG KDYH EHHQ GLIIHUHQW EXW IRU V\PSDWKHWLFUHDFWLRQl,G FRXQVHOjVDOOHJHGO\GHIHFWLYHSHUIRUPDQFHVLQFHHYLGHQFHRI JXLOW ZDV RYHUZKHOPLQJ  ,Q OLJKW RI WKH IDFWV LQWURGXFHG ,QRXUYLHZWKH2KLR6XSUHPH&RXUWFRUUHFWO\UHVROYHGWKLV GXULQJ WULDO ZH FRQFOXGH WKDW WKHUH LV QR UHDVRQDEOH LVVXH:HDIILUPWKHGHQLDORIUHOLHI SUREDELOLW\ WKDW GLIIHUHQW DFWLRQV RU D GLIIHUHQW VWUDWHJ\ E\ FRXQVHOFRXOGKDYHDOWHUHGWKHYHUGLFW GLPSURSHUFKDUDFWHUL]DWLRQRIPLWLJDWLQJIDFWRUV 7KDWVDLGFRXQVHOjVSHUIRUPDQFHGXULQJWKHSHQDOW\SKDVH 'XULQJWULDOGHIHQVHFRXQVHOLQWURGXFHGHYLGHQFHRIWKUHH SUHVHQWVDPXFKFORVHUTXHVWLRQWKDWZLOOUHTXLUHUHPDQGWR PLWLJDWLQJ IDFWRUV OLVWHG LQ 2KLR 5HY &RGH †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jV FRXUWDSSRLQWHG ODZ\HUV (sXU\6HOHFWLRQ ZHUH H[SHULHQFHG FULPLQDO GHIHQVH DWWRUQH\V DQG DOWKRXJK WKH\ KDG VRPH HLJKW PRQWKV WR JHW UHDG\ IRU 3HWLWLRQHUFRQWHQGVWKHWULDOFRXUWPDGHQXPHURXVHUURUVLQ VHQWHQFLQJ SURFHHGLQJV QHFHVVLWDWHG E\ D YHUGLFW WKDW FRQGXFWLQJYRLUGLUH FRXOGKDUGO\KDYHFRPHDVDVXUSULVHWRWKHPHYLGHQFH  H[FXVLQJWZREODFNMXURUVIRUFDXVH SUHVHQWHG WR WKH VWDWH WULDO FRXUW DW D SRVWVHQWHQFH KHDULQJ VKRZHG WKDW WKH ODZ\HUV PDGH YLUWXDOO\ QR +HILUVWDUJXHVWKDWWKHFRXUWLPSURSHUO\H[FXVHGWZREODFN DWWHPSWWRSUHSDUHIRUWKHVHQWHQFLQJSKDVHRIWKHWULDO IHPDOHSURVSHFWLYHMXURUVIRUFDXVH XQWLODIWHUWKHMXU\UHWXUQHGLWVYHUGLFWRIJXLOW\,WZDV REYLRXVRUVKRXOGKDYHEHHQWKDWWKHVHQWHQFLQJSKDVH 7KH ILUVW MXURU 6DUDK 5H\QROGV ZDV H[FXVHG DIWHU VKH ZDV OLNHO\ WR EH mWKH VWDJH RI WKH SURFHHGLQJV ZKHUH SUHVHQWHGDOHWWHUIURPWKHH[HFXWLYHGLUHFWRURIWKH WKHRWKHUSURVHFXWRU@WROG\RXZHGRQRWVHHNWKH ZLWQHVVHV $XVWLQY%HOO)G WK&LU GHDWKSHQDOW\OLJKWO\:HGRQjWIULYRORXVO\FRPHLQWRD YDFDWLQJ VHQWHQFH EHFDXVH GHIHQVH FRXQVHO GLG QRW FRXUWURRPDVNLQJIRUWKDWSHQDOW\ UHDVRQDEO\ LQYHVWLJDWH WKH IDFWV RI WKH FDVH RU UHDVRQDEO\ GHWHUPLQH WKDW DQ LQYHVWLJDWLRQ ZDV QRW QHFHVVDU\  7KH2KLR6XSUHPH&RXUWFRQVLGHUHGSHWLWLRQHUjVDUJXPHQWV )XUWKHUPRUH ODVW WHUP WKH 6XSUHPH &RXUW IRXQG FRXQVHO DQG FRQFOXGHG m>:@KDWHYHU UHVLGXDO HUURU LQKHUHV LQ WKH FRQVWLWXWLRQDOO\LQHIIHFWLYHIRUIDLOLQJWRORRNLQWRGHIHQGDQWjV PDNLQJRIWKHVWDWHPHQWVDWLVVXHLWZRXOGDSSHDUWKDWVXFK mQLJKWPDULVKFKLOGKRRGlDQGPHQWDOOLPLWDWLRQVLQSUHSDUDWLRQ HUURU ZDV KDUPOHVVl  *UHHU  2KLR 6W G DW   IRUPLWLJDWLRQ:LOOLDPV86DW 1(GDW7KHGLVWULFWFRXUWOLNHZLVHFRQFOXGHGm*LYHQ WKH ODUJHO\ XQGLVSXWHG HYLGHQFH VXSSRUWLQJ *UHHUjV $WWDFKHGWRWKHSHWLWLRQIRUSRVWFRQYLFWLRQUHOLHIZDVDQ FRQYLFWLRQWKLV&RXUWFDQQRWILQGWKDWWKHFXPXODWLYHHIIHFW DIILGDYLW E\ sDPHV (LVHQEHUJ D SV\FKRORJLVW ZKR KDV RIWKHWZRLVVXHVVRLQIHFWHG*UHHUjVWULDOZLWKXQIDLUQHVVDV FRQVXOWHGLQQXPHURXVFULPLQDOFDVHVLQFOXGLQJVRPHIRUW\ WRUHVXOWLQDGHQLDORIKLVGXHSURFHVVULJKWVl0HPRUDQGXP FDSLWDO FDVHV  +H UHYLHZHG SHWLWLRQHUjV ILOH DQG LGHQWLILHG RI2SLQLRQ$XJDW s$DW  VHYHUDODUHDVRILQDGHTXDWHSUHSDUDWLRQIDLOXUHWRLQWHUYLHZ IDPLO\PHPEHUVIDLOXUHWRUHYLHZVFKRROUHFRUGVWKDWZRXOG :HDIILUPWKHGLVWULFWFRXUW UHIOHFW SHWLWLRQHUjV LQWHOOHFWXDO GHYHORSPHQW DQG IDLOXUH WR FDOODQ\PHQWDOKHDOWKH[SHUWV E FRPPHQW WKDW MXU\jV GHFLVLRQ RQ GHDWK RQO\ D UHFRPPHQGDWLRQ )XUWKHUPRUHLQKLVGHSRVLWLRQWULDOFRXQVHO5REHUW%DNHU FRQFHGHGWKDWSUHSDUDWLRQIRUWKHPLWLJDWLRQSKDVHEHJDQDIWHU 'XULQJ FORVLQJ DUJXPHQWV WKH SURVHFXWRU VWDWHG m LH GHFLVLRQ RQ DQG VDYH 3DXOjV OLIH     +H KDG D WRXJK OLIH DQG ZDV GHDWK@ LV UHYLHZDEOH    WKH GHFLVLRQ \RX UHQGHU LV GLVDGYDQWDJHGl  1RQHWKHOHVV GHIHQVH FRXQVHO GLG QRW DXWRPDWLFDOO\UHYLHZDEOHE\WKH6XSUHPH&RXUWl,GDW FRQVLGHUUHTXHVWLQJDSSRLQWPHQWRIDSV\FKRORJLVWEXWLQVWHDG +RZHYHULQWKHFDVHEHIRUHXVWKHSURVHFXWRUjVFRPPHQW UHOLHG XSRQ WKH GRFWRU ZKR ZDV KHOSLQJ WR SUHSDUH WKH UHSUHVHQWVDFRUUHFWVWDWHPHQWRI2KLRODZ6HH2KLR5HY SUREDWLRQUHSRUW$VKLVWHVWLPRQ\UHYHDOV%DNHUKDGOLWWOH &RGH† '  2QGLUHFWDSSHDOWKH2KLR6XSUHPH JUDVSRIWKHGHWDLOVRISHWLWLRQHUjVOLIH,QVWHDGKHUHOLHGXSRQ &RXUW KHOG WKDW WKLV GLVWLQFWLRQ FRUUHFWO\ GLVSRVHG RI WKH WKHSUHVHQWHQFHLQYHVWLJDWLRQZKLFKKHKRSHGmZRXOGEH &DOGZHOOFODLP*UHHU2KLR6WGDW1(GDW KHOSIXO LQ VHQWHQFLQJ  0RVW RI LW WXUQHG RXW WR EH 0RUHRYHUWKLVFRXUWUHFHQWO\UHMHFWHGDVLPLODUFODLPLQ GHWULPHQWDOl  0RUHRYHU WKLV UHOLDQFH RQ WKH VWDWHjV SV\FKRORJLVW ZDV PLVSODFHG  $V 'U .DWKOHHQ 3 6WDIIRUG  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  WHVWLILHGm,OHWWKHsXGJHNQRZWKDW,ZRXOGKDYHWRWDNHD $QG,JXDUDQWHH\RXODGLHVDQGJHQWOHPHQLIWKDWZDV YHU\ OLPLWHG UROH DQG EH DEOH WR DGGUHVV RQO\ WKH RQH LQFRUUHFWLIWKDWZDVDGLVSXWDEOHRSLQLRQWKHVHGHIHQVH PLWLJDWLQJIDFWRUZKLFKZDVVLPLODUWRWKHVDQLW\VWDQGDUG DWWRUQH\VZRXOGKDYHKDGDQRWKHUH[SHUWRUWZRRUWKUHH DQGWKDWWKDWZRXOGKDYHWREHWKHUROHWKDW,ZRXOGWDNHLQWKH RUIRXUWHVWLI\LQWKLVFDVHDQGWHOO\RXWKDWDQGWKHUHLV PDWWHUl  6KH ZHQW RQ WR WHVWLI\ WKDW GHIHQVH FRXQVHO ZDV QRWRQHWKDWFDPHIRUZDUG DZDUHRIKHUOLPLWHGUROH $FFRUGLQJ WR SHWLWLRQHU WKLV FRPPHQWDU\ XQODZIXOO\ 'XULQJ KLV GHSRVLWLRQ %DNHU DOVR VWDWHG m:H KDG EHHQ DWWHPSWHGWRVKLIWWKHEXUGHQRISURRIWRKLP DIWHU3DXOIRUVRPHWLPHWRSURYLGHXVZLWKIDPLO\UHODWLYHV SHRSOHWKDWZRXOGEHRIVRPHEHQHILWWRKLPDQGKHQHYHU 7KLVFLUFXLWKDVH[SOLFLWO\KHOGWKDWm,IDGHIHQGDQWWHVWLILHV JDYHXVDQ\LQIRUPDWLRQDERXWSHRSOHl+RZHYHUKHZHQWRQ DSURVHFXWRUPD\DWWDFNKLVFUHGLELOLW\WRWKHVDPHH[WHQW WRLQGLFDWHWKDWKHNQHZVHYHUDOWKLQJVWKDWPHULWHGIXUWKHU DV DQ\ RWKHU ZLWQHVVl 8QLWHG 6WDWHV Y )UDQFLV  )G LQYHVWLJDWLRQ WKDW DV D \RXQJVWHU SHWLWLRQHU KDG VHHQ KLV   WK &LU   FLWLQJ FDVHV   2I FRXUVH VXFK IDWKHU PXUGHUHG EHIRUH KLV RZQ H\HV WKDW KH KDG PDQ\ FRPPHQWDU\PXVWEHVXSSRUWHGE\UHDVRQDEOHLQIHUHQFHVIURP EURWKHUVDQGVLVWHUVWKDWKHKDGEHHQLQFDUFHUDWHGDVD\RXWK WKH UHFRUG DQG QRW VLPSO\ UHSUHVHQW WKH SURVHFXWRUjV RZQ WKDWKHKDGEHHQLQIRVWHUFDUHWKDWKHVKRWDFRXVLQDWDJH RSLQLRQ  ,G  +HUH WKHUH LV QR GLVSXWH WKDW SHWLWLRQHUjV DQGWKDWKHZDVDOFRKROLF1RQHRIWKHVHOHDGVDSSHDUVWR WHVWLPRQ\FKDQJHG+HQFHWKHmFKDPHOHRQlFRPPHQWIHOO KDYHEHHQSXUVXHGZLWKDQ\WKLQJDSSURDFKLQJYLJRU$VWKLV ZLWKLQWKHERXQGVRISHUPLVVLEOHFRPPHQW FRXUWKDVREVHUYHG :KLOHWKHSURVHFXWRUjVUHPDUNFRQFHUQLQJSHWLWLRQHUjVODFN &HUWDLQO\WULDOFRXQVHOPXVWFRPPLWDVHULRXVHUURUWR RIDQH[SHUWWRUHIXWHWKHFRURQHUjVWHVWLPRQ\PD\KDYHEHHQ EHMXGJHGXQFRQVWLWXWLRQDOO\LQHIIHFWLYH+RZHYHUZKHQ LOODGYLVHG RQH FDQQRW VD\ WKDW mWKH LPSURSULHW\ ZDV VR DFOLHQWIDFHVWKHSURVSHFWRIEHLQJSXWWRGHDWKXQOHVV IODJUDQW WKDW LW UHTXLUH>V@ UHYHUVDO EHFDXVH RQO\ D QHZ WULDO FRXQVHO REWDLQV DQG SUHVHQWV VRPHWKLQJ LQ PLWLJDWLRQ FRXOGFRUUHFWWKHHUURUl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jV KLVWRU\ RU EDFNJURXQG LQGLFDWHVWKDWWKHVHQWHQFHVDUHRWKHUWKDQDSSURSULDWH LPSURSHUFORVLQJDUJXPHQWLQJXLOWSKDVH *UHHU  2KLR 6W G DW   1(G DW  'XULQJKHUFORVLQJDUJXPHQWLQWKHJXLOWSKDVHRIWKHWULDO )XUWKHUPRUH 'U 6WDIIRUGj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mRQO\LQVRIDUDVLW RXUGHFLVLRQZRXOGQRWEHDOWHUHG$PRQJRWKHUWKLQJVWKH EHDUV RQ WKH TXHVWLRQ ZKHWKHU DSSHOODWH FRXQVHO ZDV SURVHFXWRUWROGWKHMXU\ XQFRQVWLWXWLRQDOO\LQHIIHFWLYHLQIDLOLQJWRUDLVHLWl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mVLJQLILFDQW DQG REYLRXVl" 3HWLWLRQHU FRQWHQGV WKLV DUJXPHQW ZDV LPSURSHU  +H DOVR ILQGVIDXOWZLWKWKHIROORZLQJFRPPHQWDU\RQWKHFRURQHUjV  :DV WKHUH DUJXDEO\ FRQWUDU\ DXWKRULW\ RQ WKH WHVWLPRQ\ RPLWWHGLVVXHV" 'U&R[WHVWLILHGLQWKLVFDVH+HLVDQH[SHUWZLWQHVV  :HUH WKH RPLWWHG LVVXHV FOHDUO\ VWURQJHU WKDQ DQG LQ WKLV FDVH DQ H[FHSWLRQDO H[SHUW ZLWQHVV  +LV WKRVHSUHVHQWHG" WHVWLPRQ\ZDVoDQG\RXVDZKLPKHUHRQWKHZLWQHVV VWDQGVD\LWDQGGHPRQVWUDWHLWoWKDWWKHFXWVILUVWRIDOO  :HUHWKHRPLWWHGLVVXHVREMHFWHGWRDWWULDO" ZHUHFDXVHGE\DNQLIHQRWE\JODVV  :HUHWKHWULDOFRXUWjVUXOLQJVVXEMHFWWRGHIHUHQFH  RQDSSHDO"  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO   'LG DSSHOODWH FRXQVHO WHVWLI\ LQ D FROODWHUDO WDQWDPRXQWWRDGXHSURFHVVYLRODWLRQ6HH*DOOY3DUNHU SURFHHGLQJ DV WR KLV DSSHDO VWUDWHJ\ DQG LI VR )G WK&LU  ZHUHWKHMXVWLILFDWLRQVUHDVRQDEOH" ,QRUGHUWRHVWDEOLVKLPSURSHUXVHRISHUHPSWRU\FKDOOHQJHV  :KDWZDVDSSHOODWHFRXQVHOjVOHYHORIH[SHULHQFH D GHIHQGDQW PXVW ILUVW PDNH RXW D SULPD IDFLH FDVH ZKLFK DQGH[SHUWLVH" LQYROYHVVKRZLQJWKDWKHLVDPHPEHURIDFRJQL]DEOHUDFLDO JURXSDQGWKDWWKHSURVHFXWRUKDVXVHGSHUHPSWRU\FKDOOHQJHV  'LGWKHSHWLWLRQHUDQGDSSHOODWHFRXQVHOPHHWDQG WR UHPRYH PHPEHUV RI GHIHQGDQWjV UDFH IURP WKH YHQLUH JRRYHUSRVVLEOHLVVXHV" 2QFHWKLVVKRZLQJKDVEHHQPDGHWKHSURVHFXWRUPXVWRIIHU D UDFHQHXWUDO H[SODQDWLRQ IRU FKDOOHQJLQJ WKH MXURUV mWKH  ,V WKHUH HYLGHQFH WKDW FRXQVHO UHYLHZHG DOO WKH JRYHUQPHQWjV SURIIHUHG UHDVRQ QHHG QRW EH SDUWLFXODUO\ IDFWV" SHUVXDVLYHRUHYHQSODXVLEOHVRORQJDVLWLVQHXWUDOl+DUULV )GDW7KHFRXUWWKHQGHFLGHVZKHWKHUGHIHQGDQW  :HUH WKH RPLWWHG LVVXHV GHDOW ZLWK LQ RWKHU KDV SURYHQ WKDW UDFLDO DQLPXV PRWLYDWHG WKH XVH RI WKH DVVLJQPHQWVRIHUURU" SHUHPSWRU\FKDOOHQJH,QWKLVFDVHWKHSURVHFXWRUZDVQHYHU DIIRUGHGWKHRSSRUWXQLW\WRSURYLGHDUDFHQHXWUDOH[SODQDWLRQ  :DVWKHGHFLVLRQWRRPLWDQLVVXHDQXQUHDVRQDEOH EHFDXVHGHIHQVHFRXQVHOGLGQRWREMHFWWRVSHFLILFVWULNHV RQH ZKLFK RQO\ DQ LQFRPSHWHQW DWWRUQH\ ZRXOG DGRSW" :HDIILUPWKHGLVWULFWFRXUWjVFRQFOXVLRQWKDWWKLVLVVXHKDV EHHQSURFHGXUDOO\GHIDXOWHGEHFDXVHLWZDVQRWUDLVHGXSRQ 0DQLIHVWO\WKLVOLVWLVQRWH[KDXVWLYHDQGQHLWKHUPXVW GLUHFWDSSHDO:KLOHSHWLWLRQHUVHHNVWRHYDGHWKLVUHVXOWE\ LW SURGXFH D FRUUHFW mVFRUHl ZH RIIHU WKHVH LQTXLULHV UDLVLQJ WKH LVVXH LQ WKH FRQWH[W RI LQHIIHFWLYH DVVLVWDQFH RI PHUHO\DVPDWWHUVWREHFRQVLGHUHG DSSHOODWHFRXQVHOZHGHFOLQHKLVLQYLWDWLRQ7KHWULDOUHFRUG 0DSHV)GDW FLWDWLRQVRPLWWHG ,QRXUYLHZ ZRXOG QRW FDXVH FRPSHWHQW DSSHOODWH FRXQVHO WR FRQVLGHU JLYHQ WKH UHFRUG WKH LQHIIHFWLYH DVVLVWDQFH RI WULDO FRXQVHO UDLVLQJD%DWVRQFKDOOHQJHDQGHYHQLIFRXQVHOKDGWKHEHQHILW SUHVHQWHGDmVLJQLILFDQWDQGREYLRXVlFODLPWKDWDFRPSHWHQW RIWKHLQIRUPDWLRQGHYHORSHGGXULQJVXEVHTXHQWSURFHHGLQJV DWWRUQH\LQDFDSLWDOFDVHZRXOGDOPRVWFHUWDLQO\SUHVHQWRQ RXU UHYLHZ RI WKRVH PDWHULDOV FRQYLQFHV XV WKDW DSSHOODWH DSSHDO:KLOHDSSHOODWHDWWRUQH\VVKRXOGDOZD\VDWWHPSWWR FRXQVHOjV GHFLVLRQ QRW WR UDLVH WKH %DWVRQ LVVXH  IHOO ZHOO ZLQQRZRXWWKHLUEHVWLVVXHVIRUSUHVHQWDWLRQWRWKHFRXUWVLQ ZLWKLQ WKH UDQJH RI HIIHFWLYH DVVLVWDQFH DV GHILQHG E\ D FDSLWDO FDVH ZKLFK E\ GHILQLWLRQ LQYROYHV WKH XOWLPDWH 6WULFNODQG VRFLHWDOVDQFWLRQDSSHOODWHDWWRUQH\VPXVWHUURQWKHVLGHRI  XVH RI SHUHPSWRULHV WR VWULNH MXURUV ZKR H[SUHVVHG LQFOXVLRQSDUWLFXODUO\ZKHQDVKHUHWKHUHDSSHDUWRH[LVWD KHVLWDWLRQDERXWGHDWKSHQDOW\ VLJQLILFDQWQXPEHURIIDFWVWRVXSSRUWWKHFODLP 7KHQH[WDOOHJHGLQVWDQFHRImSURVHFXWRULDOPLVFRQGXFWlLV ,Q DGGLWLRQ WR WKH UHODWLYH VWUHQJWK RI WKH LQHIIHFWLYH WKHVWDWHjVGHFLVLRQWRXVHSHUHPSWRU\FKDOOHQJHVWRH[FXVH DVVLVWDQFH FODLP VHYHUDO RWKHU RI WKH IDFWRUV VXJJHVWHG E\ WZRMXURUVZKRH[SUHVVHGKHVLWDWLRQDERXWLPSRVLQJWKHGHDWK 0DSHVIDYRUSHWLWLRQHUjVSRVLWLRQ)LUVWWKHOHJDOYLDELOLW\RI SHQDOW\%RWKPHQLQGLFDWHGGXULQJYRLUGLUHWKDWWKH\FRXOG DQLQHIIHFWLYHDVVLVWDQFHFODLPKDGEHHQILUPO\HVWDEOLVKHGE\ IROORZ WKH FRXUWjV LQVWUXFWLRQV EXW WKDW WKH\ IHOW WKH GHDWK 6WULFNODQG  6HFRQG DW WKH WLPH RI WKH GLUHFW DSSHDO WULDO SHQDOW\VKRXOGEHXVHGVSDULQJO\7KLVLVVXHZDVQRWUDLVHG FRXQVHOKDGQRWWHVWLILHGLQDFROODWHUDOSURFHHGLQJFRQFHUQLQJ  *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  ULJKW WR FRXQVHO ZKHQ PRXQWLQJ FROODWHUDO DWWDFNV XSRQ WULDOVWUDWHJ\7KLUGQHLWKHURISHWLWLRQHUjVDSSHOODWHDWWRUQH\V FRQYLFWLRQVLQVWDWHFRXUW  KDGHYHUSUHSDUHGDGHDWKSHQDOW\DSSHDO$QGIRXUWKWKH RPLWWHG LVVXHV ZHUH QRW GHDOW ZLWK LQ WKH FRQWH[W RI RWKHU :H DIILUP WKDW LVVXH EDVHG XSRQ WKH UHDVRQLQJ RI WKH DVVLJQPHQWVRIHUURU GLVWULFWFRXUW ,QWKHFDVHEHIRUHXVDSSHOODWHFRXQVHOVjIDLOXUHWRUDLVH '3URVHFXWRULDO0LVFRQGXFW LQHIIHFWLYHDVVLVWDQFHRQGLUHFWDSSHDOLVIXUWKHUFRPSOLFDWHG E\ SHWLWLRQHUjV DOOHJDWLRQ RI FRQIOLFW  5REHUW %DNHU DQG 3HWLWLRQHU UDLVHV D QXPEHU RI LVVXHV XQGHU WKH UXEULF RI 5REHUW/RZHU\DFWHGDVFRXUWDSSRLQWHGWULDOFRXQVHO$IWHU SURVHFXWRULDOPLVFRQGXFW WKHYHUGLFW%DNHUDQG/RZHU\ZHUHUHSODFHGE\WZRRWKHU DWWRUQH\V3HWHU&DKRRQDQG5LFKDUG.DVD\1HZFRXQVHO %DWVRQFKDOOHQJH ILOHG WKHLU DSSHOODWH EULHI RQ 0DUFK    2QH PRQWK ODWHUZKLOHWKHDSSHDOZDVVWLOOSHQGLQJ3HWHU&DKRRQMRLQHG $OWKRXJK QRW SURVHFXWRULDO PLVFRQGXFW LQ WKH WUDGLWLRQDO %DNHUjVILUP,QSHWLWLRQHUj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mXQFRQIOLFWHGlFRXQVHORQGLUHFWDSSHDOWKH UXOHHQXQFLDWHGLQ&ROHGLGQRWDSSO\WRKLP:HDJUHHGDQG H[SODLQHGRXUGHFLVLRQLQWKHVHWHUPV  %HFDXVH WKHUH LV DPELJXLW\ VXUURXQGLQJ WKH LVVXH DQG +H GLG KRZHYHU PDNH D PRWLRQ SULRU WR YRLU GLUH DVNLQJ WKH FRXUW WR UHTXLUH WKH VWDWH WR SURYLGH D UHDVRQ HDFK WLPH LW XVHG D SHUHPSWRU\ WR EHFDXVH WKH 6WDWH FDQQRW SRLQW WR D FDVH ILUPO\ VWULNH D EODFN MXURU 7KH SURVHFXWRU UHSOLHG WKDW WKH 2KLR FRGH LPSRVHG HVWDEOLVKLQJ DV RI WKH WLPH RI &RPEVjV DSSHDO WKDW QR VXFK UHTXLUHPHQW DQG WR GR VR mZRXOG ZKROO\ EOXU WKH GLVWLQFWLRQ LQHIIHFWLYHQHVVFODLPVPXVWEHEURXJKWRQGLUHFWDSSHDO EHWZHHQ D FKDOOHQJH IRU FDXVH DQG D SHUHPSWRU\ FKDOOHQJHl 7KH WULDO ZKHQWULDOFRXQVHODOVRVHUYHVDVFRFRXQVHORQDSSHDO FRXUW RYHUUXOHG GHIHQVH FRXQVHOjV PRWLRQ EDVHG XSRQ 2KLR 5HY &RGH ZHDUHXQDEOHWRFRQFOXGHWKDWDILUPO\HVWDEOLVKHGVWDWH †  DQG 2KLR &ULPLQDO 5XOH  7KH WULDO RFFXUUHG RQH \HDU EHIRUH SURFHGXUDOUXOHH[LVWHG,QGHHGDWWKHWLPHRI&RPEVjV DSSHDOZDVILOHGLWZRXOGKDYHEHHQHQWLUHO\UHDVRQDEOH WKH %DWVRQ GHFLVLRQ  WRFRQFOXGHWKDW&RPEVjVQHZFRXQVHOGLGQRWPHHWWKH 7KH MXU\ ZDV FRPSULVHG RI WHQ ZKLWHV DQG WZR EODFNV +RZHYHU VLPSO\ EHFDXVH EODFNV DUH XOWLPDWHO\ VHDWHG RQ D MXU\ GRHV QRW SUHFOXGH &ROH VWDQGDUG RI EHLQJ mLQ QR ZD\ HQMRLQHG IURP D %DWVRQ FKDOOHQJH 8QLWHG 6WDWHV Y +DUULV  )G   WK &LU DVVHUWLQJWKHLQHIIHFWLYHQHVVRIDSSHOODQWjVWULDOFRXQVHOl    *UHHUY0LWFKHOO 1R 1R *UHHUY0LWFKHOO  &ROH1(GDWDQGWKXVWKDWUHVMXGLFDWDZRXOG 8QGHUWKHRSHQLQJFODXVHRI†  H  DIDLOXUHWR QRWDSSO\ GHYHORS WKH IDFWXDO EDVLV RI D FODLP LV QRW HVWDEOLVKHG XQOHVVWKHUHLVODFNRIGLOLJHQFHRUVRPHJUHDWHUIDXOW &RPEV  )G DW   2EYLRXVO\ &RPEV LV IDFWXDOO\ DWWULEXWDEOHWRWKHSULVRQHURUWKHSULVRQHUjVFRXQVHO GLVWLQJXLVKDEOHIURPRXUFDVHEHFDXVHQHLWKHURISHWLWLRQHUjV WZRDSSHOODWHDWWRUQH\VUHSUHVHQWHGKLPDWWULDO:HWKHUHIRUH :LOOLDPV86DW)XUWKHUPRUHm>W@KHTXHVWLRQLV GHFOLQHWRH[WHQG&RPEVWRWKHVLWXDWLRQEHIRUHXVVRDVWR QRWZKHWKHUWKHIDFWVFRXOGKDYHEHHQGLVFRYHUHGEXWLQVWHDG H[FXVHWKHSURFHGXUDOGHIDXOWRIKLVLQHIIHFWLYHDVVLVWDQFHRI ZKHWKHUWKHSULVRQHUZDVGLOLJHQWLQKLVHIIRUWVl,GDW WULDOFRXQVHOFODLP1HYHUWKHOHVVWKHUHPRWHSRVVLELOLW\WKDW DSSHOODWHFRXQVHOPLJKWKDYHIHOWFRQVWUDLQHGLQUDLVLQJWKDW ,Q WKH FDVH EHIRUH XV SHWLWLRQHU SXUVXHG KLV LQHIIHFWLYH FODLPFRXSOHGZLWKWKHFRQFHUQVDOUHDG\GLVFXVVHGFRXQVHO DVVLVWDQFHRIDSSHOODWHFRXQVHOFODLPZLWKSURSHUGLOLJHQFH FDXWLRQZLWKUHVSHFWWRSHWLWLRQHUjVLQHIIHFWLYHDVVLVWDQFHRI UDLVLQJLWILUVWDOEHLWSUHPDWXUHO\LQKLVSHWLWLRQIRUSRVW DSSHOODWHFRXQVHOFODLP FRQYLFWLRQ UHOLHI DQG WKHQ LQ KLV PRWLRQ IRU GHOD\HG UHFRQVLGHUDWLRQ  %RWK RI WKHVH SOHDGLQJV UHTXHVWHG DQ 7KH2KLR&RXUWRI$SSHDOVjRSLQLRQGHQ\LQJSHWLWLRQHUj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jVSHUIRUPDQFHWKDWLV LQ ZKLFK WR HVWDEOLVK ZKHWKHU DSSHOODWH FRXQVHO UHQGHUHG WKDW KLV FRQYLFWLRQ ZRXOG KDYH EHHQ VHW DVLGH E\ WKLV FRQVWLWXWLRQDOO\ LQHIIHFWLYH DVVLVWDQFH ZLWK UHVSHFW WR WKH &RXUW SHQDOW\SKDVHRISHWLWLRQHUjVWULDO 6WDWH Y *UHHU 1R  2KLR &W $SS )HE   &2KLRjV3RVW&RQYLFWLRQ6FKHPH XQUHSRUWHG  sRXUQDO (QWU\ DW  s$ DW   )XUWKHUPRUH SHWLWLRQHU  ZDV QRW DIIRUGHG DQ HYLGHQWLDU\ 3HWLWLRQHU FRQWHQGV WKDW 2KLRjV SRVWFRQYLFWLRQ VFKHPH KHDULQJWRGHYHORSKLVLQHIIHFWLYHDVVLVWDQFHRIFRXQVHOFODLP IDLOVWRSURYLGHGHIHQGDQWVDQDGHTXDWHFRUUHFWLYHSURFHVVIRU E\HLWKHUVWDWHFRXUWVRUWKHGLVWULFWFRXUW:HDUHRIFRXUVH UHYLHZLQJFODLPVRIFRQVWLWXWLRQDOYLRODWLRQV PLQGIXO WKDW WKH $('3$  86& †  H  SHUPLWV D GLVWULFWFRXUWWRKROGDQHYLGHQWLDU\KHDULQJRQO\LQOLPLWHG 7KHGLVWULFWFRXUWFRQFOXGHGWKDWKDEHDVFRUSXVFDQQRWEH FLUFXPVWDQFHV  6HH  86& †  H    +RZHYHU LQ XVHG WR PRXQW FKDOOHQJHV WR D VWDWHjV VFKHPH RI SRVW :LOOLDPVWKH6XSUHPH&RXUWH[SODLQHGWKHVHOLPLWDWLRQVLQD FRQYLFWLRQUHOLHIUHO\LQJXSRQ.LUE\Y'XWWRQ)G PDQQHUWKDWZHUHDGWRIDYRUDQHYLGHQWLDU\KHDULQJLQWKLV  WK&LU  KDEHDVFRUSXVLVQRWWKHSURSHUPHDQVE\ FDVH&RQFHUQLQJWKHVWDWXWHjVFRPPDQGWKDWQRHYLGHQWLDU\ ZKLFK SULVRQHUV VKRXOG FKDOOHQJH HUURUV RU GHILFLHQFLHV LQ KHDULQJVKDOORFFXUZKHQDSHWLWLRQHUKDVmIDLOHGWRGHYHORS VWDWHSRVWFRQYLFWLRQSURFHHGLQJV 0RUHRYHUWKH6XSUHPH WKHIDFWXDOEDVLVRIDFODLPlWKH&RXUWRIIHUHGWKHIROORZLQJ &RXUWKDVKHOGWKDWVWDWHVKDYHQRFRQVWLWXWLRQDOREOLJDWLRQWR LQWHUSUHWDWLRQ SURYLGH SRVWFRQYLFWLRQ UHPHGLHV  6HH 3HQQV\OYDQLD Y )LQOH\86   WKHUHLVQRFRQVWLWXWLRQDO
Source:  CourtListener

Can't find what you're looking for?

Post a free question on our public forum.
Ask a Question
Search for lawyers by practice areas.
Find a Lawyer