United States v. Butler

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

81,7(' 67$7(6 2) $0(5,&$ ;
3ODLQWLII$SSHOOHH 

 1R
Y 
!

526/<1 %87/(5 
'HIHQGDQW$SSHOODQW 
1
$SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
IRUWKH(DVWHUQ'LVWULFWRI0LFKLJDQDW$QQ$UERU
1Rn*HRUJH&6WHHK'LVWULFWsXGJH
$UJXHG0D\
'HFLGHGDQG)LOHGsXO\
%HIRUH0(55,77s21(6DQG&/$<&LUFXLWsXGJHV
BBBBBBBBBBBBBBBBB
&2816(/
$5*8('1&'HGD\/D5HQH%HWKHVGD0DU\ODQGIRU
$SSHOODQW  sHQQLIHU s 3HUHJRUG $66,67$17 81,7('
67$7(6 $77251(< 'HWURLW 0LFKLJDQ IRU $SSHOOHH
21%5,()1&'HGD\/D5HQH%HWKHVGD0DU\ODQGIRU
$SSHOODQW5RQDOG::DWHUVWUHHW$66,67$1781,7('
67$7(6$77251(<'HWURLW0LFKLJDQIRU$SSHOOHH


 8QLWHG6WDWHVY%XWOHU 1R

&/$< s GHOLYHUHG WKH RSLQLRQ RI WKH FRXUW LQ ZKLFK
s21(6 s MRLQHG  0(55,77 s SS  GHOLYHUHG D
VHSDUDWHGLVVHQWLQJRSLQLRQ
BBBBBBBBBBBBBBBBB
23,1,21
BBBBBBBBBBBBBBBBB
&/$<&LUFXLWsXGJH'HIHQGDQW5RVO\Q%XWOHUDSSHDOV
IURPWKHMXGJPHQWRIFRQYLFWLRQDQGVHQWHQFHHQWHUHGE\WKH
GLVWULFWFRXUWRQsDQXDU\IRURQHFRXQWRIFRQVSLUDF\
WRGLVWULEXWHFRFDLQHLQYLRODWLRQRI86&†DVZHOO
DV RQH FRXQW RI SRVVHVVLRQ ZLWK LQWHQW WR GLVWULEXWH D
FRQWUROOHGVXEVWDQFHLQYLRODWLRQRI86&†D
IROORZLQJDMXU\WULDO6SHFLILFDOO\'HIHQGDQWFKDOOHQJHVRQ
DSSHDO WKH GLVWULFW FRXUWjV RUGHU GHQ\LQJ KHU PRWLRQ WR
VXSSUHVVWKHHYLGHQFHHQWHUHGRQsXO\DVZHOODVWKH
DPHQGHGRUGHUHQWHUHGRQsXO\)RUWKHUHDVRQVVHW
IRUWKEHORZZH5(9(56(WKHGLVWULFWFRXUWjVRUGHUGHQ\LQJ
'HIHQGDQWjVPRWLRQWRVXSSUHVVWKHHYLGHQFHDQG9$&$7(
'HIHQGDQWjVMXGJPHQWRIFRQYLFWLRQDQGVHQWHQFH
%$&.*5281'
3URFHGXUDO+LVWRU\
'HIHQGDQW DQG KHU WKUHH FRGHIHQGDQWV &OHPDQW
(]HNZHPED$PREL2ELRKDDQG2JH8NRKDZHUHLQGLFWHG
IRU FRQVSLUDF\ WR GLVWULEXWH FRFDLQH  86& †  DQG
SRVVHVVLRQ ZLWK WKH LQWHQW WR GLVWULEXWH FRFDLQH  86&
†DRQsDQXDU\7KHLQGLFWPHQWVDURVHRXW
RIZDUUDQWOHVVVHDUFKHVDQGVHL]XUHVE\WKHSROLFHDIWHUWKH
VWRSRIGHIHQGDQWVjYHKLFOHVLQWKH'HWURLWPHWURSROLWDQDUHD
RQsDQXDU\
0RWLRQVWRVXSSUHVVWKHIUXLWVRIWKHVHDUFKHVDQGVHL]XUHV
ZHUHILOHGE\DOOGHIHQGDQWVDQGDQHYLGHQWLDU\KHDULQJZDV
KHOG EHIRUH 8QLWHG 6WDWHV 'LVWULFW sXGJH sRKQ )HLNHQV RQ
$SULO  DQG $SULO    $W WKH FRQFOXVLRQ RI WKH
KHDULQJ WKH FRXUW HQFRXUDJHG WKH SDUWLHV WR ILOH DGGLWLRQDO
1R 8QLWHG6WDWHVY%XWOHU 

PHPRUDQGDWKDWWKH\EHOLHYHGWREHSHUWLQHQWWRWKHUHVROXWLRQ
RIWKHPRWLRQVDQGERWKSDUWLHVWKHUHDIWHUILOHGVXSSOHPHQWDO
PHPRUDQGD  2Q sXO\   sXGJH )HLNHQV LVVXHG DQ
RSLQLRQDQGRUGHUGHQ\LQJGHIHQGDQWVjPRWLRQVWRVXSSUHVV
LQFOXGLQJ WKH PRWLRQ EURXJKW E\ 'HIHQGDQW ZKLFK LV WKH
VXEMHFWRIWKLVDSSHDO7KHSDUWLHVVRXJKWUHFRQVLGHUDWLRQRI
WKHRSLQLRQDQGRUGHUDQGWKHGLVWULFWFRXUWWKHUHDIWHULVVXHG
DQDPHQGHGRSLQLRQRQsXO\
2Q 2FWREHU  'HIHQGDQW ZDV FRQYLFWHG E\ D MXU\
EHIRUH8QLWHG6WDWHV'LVWULFWsXGJH*HRUJH6WHHKWRZKRP
KHUFDVHKDGEHHQUHDVVLJQHG'HIHQGDQWWKHQILOHGWKLVWLPHO\
DSSHDO
)DFWV
2QsDQXDU\0DULR%XUQVD0LFKLJDQ6WDWH3ROLFH
RIILFHU DVVLJQHG WR D )HGHUDO %XUHDX RI ,QYHVWLJDWLRQ
VSRQVRUHG GUXJ LQWHUGLFWLRQ WDVN IRUFH ZDV RQ GXW\
PRQLWRULQJDEXVVWDWLRQLQ'HWURLWLQDQDWWHPSWWRLQWHUGLFW
WKH IORZ RI QDUFRWLFV FRPLQJ LQWR RU OHDYLQJ WKH VWDWH  $W
DSSUR[LPDWHO\  SP DQ LQERXQG EXV IURP &KLFDJR
DUULYHGDQGDPDQFDUU\LQJDEOXHGXIIOHEDJZKLFKDSSHDUHG
WREHOLJKWO\SDFNHGGLVHPEDUNHGIURPWKHEXV2IILFHU%XUQV
DORQJZLWKDIHOORZRIILFHUDSSURDFKHGWKHPDQDQGLGHQWLILHG
WKHPVHOYHV DV SROLFH RIILFHUV ZKR URXWLQHO\ SDWURO WKH EXV
VWDWLRQ WR LQYHVWLJDWH WKH WUDQVSRUWDWLRQ RI GUXJV DQG GUXJ
PRQH\$WWKHRIILFHUjVUHTXHVWWKHPDQSURGXFHGDWLFNHW
ZKLFKLQGLFDWHGWKDWKHKDGWUDYHOHGIURP+RXVWRQ7H[DVWR
&KLFDJR,OOLQRLVDMRXUQH\RIDERXWWZHQW\ILYHWRWKLUW\
KRXUV'HVSLWHWKHOHQJWKRIWKHMRXUQH\WKHPDQWROGWKH
RIILFHUVWKDWKHZRXOGEHVWD\LQJLQ'HWURLWIRURQO\DERXWD
GD\ EHFDXVH KH KDG WR UHWXUQ WR VFKRRO  :KHQ DVNHG KLV
SXUSRVHIRUYLVLWLQJ'HWURLWWKHPDQUHSOLHGWKDWKHZDVKHUH
WRYLVLWDIULHQGZKRPKHKHVLWDWLQJO\QDPHGRQO\DVm6DPl
7KHPDQDOVRSUHVHQWHGD7H[DVLGHQWLILFDWLRQFDUGLGHQWLI\LQJ
KLPVHOIDV2JH8NRKD8NRKDFRQVHQWHGWRDVHDUFKRIWKH
GXIIHOEDJWKDWKHZDVFDUU\LQJ7KHVHDUFKUHYHDOHGRQO\
WRLOHWULHVWZRDFFRXQWLQJERRNVDQGDOHDWKHUMDFNHW$/DZ
(QIRUFHPHQW,QIRUPDWLRQ1HWZRUN/(,1FKHFNZDVGRQHRQ
 8QLWHG6WDWHVY%XWOHU 1R 1R 8QLWHG6WDWHVY%XWOHU 

8NRKDZKLFKUHYHDOHGWKDWKHKDGEHHQDUUHVWHGLQ+RXVWRQ 7KXVWKHUHZDVFRQVHQWDVIRXQGE\WKH'LVWULFW&RXUWIRU
WKHSULRU\HDUIRUPDULMXDQDSRVVHVVLRQ,GDW WKHGHOD\LQDOORZLQJWKHGHIHQGDQWWROHDYHDQGWKHUHZDV
SUREDEOH FDXVH IRU WKH VHDUFK RI WKH sHHS &KHURNHH
8NRKD ZDV SHUPLWWHG WR OHDYH WKH EXV VWDWLRQ E\ FDE DW $FFRUGLQJO\ , ZRXOG DIILUP WKH MXGJPHQW RI WKH 'LVWULFW
DSSUR[LPDWHO\SPEXWZDVIROORZHGE\WKHWDVNIRUFH &RXUW
RIILFHUVWRDKRWHOm0DUYLQjV*DUGHQV,QQlmWKH,QQlZKHUH
KHFKHFNHGLQDQGZHQWWRKLVURRP7KH,QQLVORFDWHGRQ
1RUWKZHVWHUQ +LJKZD\ LQ 6RXWKILHOG 0LFKLJDQ  2IILFHU
%XUQVFKHFNHGZLWKWKHGHVNFOHUNDWWKHKRWHODQGOHDUQHG
WKDW8NRKDKDGSDLGIRURQHQLJKWGRXEOHRFFXSDQF\DQGKDG
JLYHQDQDGGUHVVGLIIHUHQWIURPWKDWZKLFKKHKDGJLYHQZKHQ
TXHVWLRQHGDWWKHEXVVWDWLRQ7KHRIILFHUVIRXQGLWVXVSLFLRXV
WKDW8NRKDKDGWUDYHOHGIRUWZHQW\QLQHKRXUVRQDEXVIURP
7H[DVWRYLVLWDIULHQGIRURQO\RQHGD\EHIRUHUHWXUQLQJWR
7H[DVWKDW8NRKDKDGJLYHQWKHGHVNFOHUNDGLIIHUHQWODVW
QDPHDQGWKDWKHKDGSDLGIRUWKHURRPLQFDVK$VVXFKDW
DSSUR[LPDWHO\SPWKHRIILFHUVHVWDEOLVKHGVXUYHLOODQFH
RQ8NRKDjVKRWHOURRP
$W DSSUR[LPDWHO\  DP RQ sDQXDU\   DIWHU
KDYLQJREVHUYHGQRDFWLYLW\IURP8NRKDjVURRPWKHRIILFHUV
WHPSRUDULO\VXVSHQGHGWKHLUVXUYHLOODQFHXQWLODERXWDP
ZKHQWKHVXUYHLOODQFHZDVUHHVWDEOLVKHG1RWKLQJUHPDUNDEOH
RFFXUUHGXQWLODERXWDPZKHQDJUHHQ&KHFNHU&DE
DUULYHG DW WKH KRWHO GULYHQ E\ D PDQ ODWHU LGHQWLILHG DV
&OHPHQW(]HNZHPEDZLWK'HIHQGDQW5RVO\Q%XWOHUVHDWHGLQ
WKHEDFNVHDW%RWK(]HNZHPEDDQG'HIHQGDQWJRWRXWRIWKH
FDEDQGZHQWWRDVLGHGRRURIWKH,QQZKHUHWKH\ZHUHPHWE\
8NRKD:KHQWKH\HQWHUHGWKH,QQ'HIHQGDQWZDVFDUU\LQJ
DEODFNOHDWKHUSXUVHEXWZKHQ(]HNZHPEDDQG'HIHQGDQW
OHIWWKHKRWHODERXWWZHQW\ILYHPLQXWHVODWHU'HIHQGDQWZDV
FDUU\LQJDEODFNOHDWKHUSXUVHDORQJZLWKDZKLWHSODVWLFEDJ
(]HNZHPED JRW LQWR WKH GULYHUjV VHDW RI WKH FDE ZKLOH
'HIHQGDQW JRW LQWR WKH EDFN VHDW RI WKH FDE DQG WKH WZR
GHSDUWHG
6KRUWO\WKHUHDIWHUDWDSSUR[LPDWHO\SP8NRKDOHIW
WKH,QQDQGZDVFDUU\LQJDEODFNJDUPHQWEDJLQDGGLWLRQWR
WKH EOXH GXIIHO EDJ WKDW KH ZDV FDUU\LQJ DW WKH DLUSRUW  $
SHUVRQZKRZDVODWHULGHQWLILHGDV$PREL2ELRKDGURYHXSLQ
 8QLWHG6WDWHVY%XWOHU 1R 1R 8QLWHG6WDWHVY%XWOHU 

BBBBBBBBBBBBBBBBB DJUHHQ)RUG(VFRUWDQG8NRKDJRWLQWRWKHSDVVHQJHUVHDWRI
WKHFDUDQGWKHWZRPHQGHSDUWHG
',66(17
BBBBBBBBBBBBBBBBB ,Q WKH PHDQWLPH 0LFKLJDQ 6WDWH 3ROLFH 'HWHFWLYH
/LHXWHQDQW/DZUHQFH+HLQVDOVRDSDUWRIWKHWDVNIRUFHDQG
0(55,77&LUFXLWsXGJHGLVVHQWLQJ,GLVDJUHHZLWKWKH IRUFH DJHQW 'RQDOG )DUDJR IROORZHG WKH &KHFNHU &DE LQ
&RXUWjVRSLQLRQLQWZRUHVSHFWV)LUVW,FHUWDLQO\GRQRWILQG ZKLFK(]HNZHPEDDQG'HIHQGDQWKDGGHSDUWHG/LHXWHQDQW
FOHDUO\ HUURQHRXV WKH 'LVWULFW &RXUWjV ILQGLQJ WKDW WKH +HLQV FRQWDFWHG WKH GLVSDWFK RIILFHU RI WKH ORFDO SROLFH
GHIHQGDQWFRQVHQWHGWRDFFRPSDQ\WKHSROLFHRIILFHUVWRWKH GHSDUWPHQW 5HGIRUG 7RZQVKLS WR HIIHFW D VWRS RI WKH FDE
SROLFH VWDWLRQ  ,W VHHPV WR PH WKDW WKH 'LVWULFW &RXUW ZDV EHFDXVHmWKHUHZDVD GUXJ LQYHVWLJDWLRQJRLQJRQDQG>KH@
FRUUHFW LQ FRQFOXGLQJ WKDW WKH GHIHQGDQW WULHG WR DOOD\ ZDQWHGWKDWYHKLFOHVWRSSHGl/LHXWHQDQW+HLQVWHVWLILHGWKDW
VXVSLFLRQE\EHLQJFRRSHUDWLYHZLWKWKHSROLFH2EYLRXVO\ KHREVHUYHGWKHFDEPRYHIURPRQHODQHWRDQRWKHUZLWKRXW
VKH NQHZ VKH ZDV JXLOW\ RI VPXJJOLQJ FRFDLQH DQG KDG LW VLJQDOLQJKRZHYHUWKLVDOOHJHGWUDIILFLQIUDFWLRQZDVQRWWKH
KLGGHQLQWKHJDPHSDFNDJHLQKHUSRVVHVVLRQEXWVKHWKRXJKW UHDVRQWKDW/LHXWHQDQW+HLQVFRQWDFWHGWKH5HGIRUG7RZQVKLS
WKDW VKH FRXOG GHFHLYH WKH RIILFHUV LI VKH DSSHDUHG WR SROLFH
FRRSHUDWHLQDOOUHVSHFWVLQFOXGLQJFRQVHQWLQJWRDFFRPSDQ\
WKH RIILFHUV WR WKH SROLFH VWDWLRQ DQG DQVZHULQJ WKHLU $W DSSUR[LPDWHO\  SP 5HGIRUG 7RZQVKLS 3ROLFH
TXHVWLRQV,QIDFWKHUVWUDWHJ\DOPRVWZRUNHG,WZRXOGKDYH 2IILFHUV(ULF*LOOPDQDQG(GZDUG+DQLVKVWRSSHGWKHFDE
ZRUNHG LI WKH SROLFH KDG QRW IRXQG FRFDLQH ZUDSSHG LQ D %RWKRIILFHUVWHVWLILHGWKDWWKHRQO\LQIRUPDWLRQWKH\UHFHLYHG
VLPLODUJDPHER[LQWKHSRVVHVVLRQRIKHUFRQIHGHUDWHDVVKH ZDV WKDW WKH IHGHUDO WDVN IRUFH ZDQWHG D YHKLFOH VWRSSHG
ZDV MXVW DERXW WR OHDYH  $FFRUGLQJO\ , ZRXOG DIILUP WKH EHFDXVH LW ZDV EHOLHYHG WR EH mLQYROYHG LQ QDUFRWLF
'LVWULFW&RXUWjVILQGLQJRIIDFWWKDWWKHGHIHQGDQWFRQVHQWHG WUDIILFNLQJl RU mQDUFRWLFV DFWLYLWLHVl  1HLWKHU RIILFHU ZDV
WRWKHULGHWRWKHSROLFHVWDWLRQDQGWRWKHLQWHUURJDWLRQDWWKH DVNHGWRORRNRXWIRURUREVHUYHGDQ\WUDIILFYLRODWLRQVE\WKH
SROLFHVWDWLRQ FDE  2IILFHU *LOOPDQ GHDOW SULQFLSDOO\ ZLWK WKH GULYHU
(]HNZHPEDDQG2IILFHU+DQLVKGHDOWZLWK'HIHQGDQW
6HFRQG WKH RIILFHUV KDG SUREDEOH FDXVH WR VHDUFK WKH
GHIHQGDQWjV sHHS &KHURNHH DIWHU WKH\ OHDUQHG WKDW WKH 2IILFHU+DQLVKWHVWLILHGWKDWKHDSSURDFKHG'HIHQGDQWWROG
GHIHQGDQWjVFRQIHGHUDWHKDGDJDPHSDFNDJHVLPLODUWRWKH KHUWKDWWKHRIILFHUVKDGEHHQLQVWUXFWHGWRVWRSWKHYHKLFOH
RQH GHIHQGDQW KDG DQG WKDW LQVLGH WKDW JDPH SDFNDJH ZDV EHFDXVH LW ZDV VXVSHFWHG DV EHLQJ LQYROYHG LQ mQDUFRWLFV
IRXQG WZR DQG RQHKDOI NLORJUDPV RI FRFDLQH  2QFH WKH\ DFWLYLWLHVlDQG DVNHG 'HIHQGDQW WR VWHS RXW RI WKH FDE
NQHZ WKDW WKH WZR SHRSOH GHIHQGDQW DQG GHIHQGDQWjV 'HIHQGDQWWROG2IILFHU+DQLVKWKDWWKHFDEKDGSLFNHGKHUXS
FRQIHGHUDWHZHUHFDUU\LQJJDPHVRIDVLPLODUW\SHDQGWKDW DW7HOHJUDSKDQG7ZHOYH0LOH5RDGVDQGWKDWVKHKDGMXVW
WKHFRQIHGHUDWHKDGFRFDLQHLQKLVJDPHSDFNDJHWKHSROLFH ERXJKW D JDPH DW WKH m7R\V58Vl VWRUH  2IILFHU +DQLVK
WKHQKDGSUREDEOHFDXVHWREHOLHYHWKDWGHIHQGDQWjVJDPHDOVR REVHUYHG WKDW 'HIHQGDQW KDG D SXUVH DQG D ZKLWH SODVWLF
SUREDEO\ FRQWDLQHG FRFDLQH  7KH\ KDG SUREDEOH FDXVH WR VKRSSLQJEDJQH[WWRKHULQWKHFDE2IILFHU+DQLVKVWDWHG
EHOLHYHWKDWWKHWZRZHUHHQJDJHGLQDVLPLODUW\SHRIUXVH WKDW'HIHQGDQWFRQVHQWHGWRDVHDUFKRIKHUSXUVHDQGKHUEDJ
7KHDXWRPRELOHH[FHSWLRQWRWKHZDUUDQWUHTXLUHPHQWFOHDUO\ $OWKRXJK KH IRXQG D VKULQNZUDSSHG KLV@KDQGVRQ>(]HNZHPED@
WRKDYHKLPKDYHDVHDWLQWKHEDFNRIWKHFDUDWZKLFKSRLQW
>(]HNZHPED@ XVHG DQ DPRXQW RI IRUFH WR SXVK >2IILFHU
*LOOPDQ@DZD\DQGGLGQRWZDQWWRJHWLQWKHEDFNRIWKHFDUl
$VWUXJJOHWKHQHQVXHGLQDQDWWHPSWWRJHW(]HNZHPEDLQWKH
EDFNRIWKHSDWUROFDUZKLFK2IILFHU*LOOPDQGHVFULEHGDV
IROORZV
7KHUHZDVQRIRUFHDJDLQVWPHDWWKDWSRLQWRWKHUWKDQ
KLP XVLQJ ZKDW , ZRXOG FDOO GHIHQVLYH IRUFH  +H MXVW
GLGQjWZDQWWRGRZKDW,ZDQWHGKLPWRGRDWWKDWWLPH
+H ZDV QRW EHLQJ YLROHQW WRZDUG PH  , ZDV WU\LQJ WR
VHFXUHKLPDQGDWWKDWSRLQWDUUHVWKLPIRULQWHUIHULQJ
2IILFHU +DQLVK DVVLVWHG 2IILFHU *LOOPDQ LQ WKH HQVXLQJ
VWUXJJOHDQGDWRQHSRLQW(]HNZHPEDSXVKHG2IILFHU+DQLVK
LQWR WUDIILF DORQJ 7HOHJUDSK 5RDG  $FFRUGLQJ WR 2IILFHU
*LOOPDQ$JHQW)DUDJRDUULYHGRQWKHVFHQHDWDERXWWKDWWLPH
DQGWKHWKUHHRIILFHUVZHUHDEOHWRVXEGXH(]HNZHPEDDQG
SODFHKLPLQWKHSDWUROFDU(]HNZHPEDZDVFKDUJHGZLWK
 8QLWHG6WDWHVY%XWOHU 1R 1R 8QLWHG6WDWHVY%XWOHU 

'HIHQGDQWDQGVHL]HGWKHZKLWHEDJIURPKHUsHHS&KHURNHH UHVLVWLQJ DQG DVVDXOW DQG EDWWHU\ RQ DQ RIILFHU DQG SODFHG
WKH\SURSHUO\DFWHGRQUHDVRQDEOHVXVSLFLRQ$OWKRXJKLWLV XQGHU DUUHVW   (]HNZHPED ZDV EOHHGLQJ IURP KLV OLS RU
WUXH WKDW WKH RIILFHUV FRQGXFWLQJ WKH VWRS KDG UHDVRQDEOH IRUHKHDGIURPLQMXULHVKHPD\KDYHVXVWDLQHGZKHQKLVIDFH
VXVSLFLRQ WR VWRS WKH YHKLFOHV EDVHG XSRQ WKH LQIRUPDWLRQ VWUXFNWKHJURXQGGXULQJWKHVWUXJJOHZLWKWKHRIILFHUV
IURPWKHRIILFHUVFRQGXFWLQJVXUYHLOODQFHVHH+HQVOH\
86 DW  LW LV HTXDOO\ DV WUXH WKDW WKH GHWHQWLRQ RI WKH 2IILFHU*LOOPDQDQG2IILFHU+DQLVKWKHQVHDUFKHGWKHFDE
SHUVRQV VWRSSHG FRXOG QRW H[WHQG SDVW mFKHFNLQJ RXW WKH EHOLHYLQJ WKDW WKH\ ZHUH ORRNLQJ IRU QDUFRWLFV VSHFLILFDOO\
VXVSLFLRXVFLUFXPVWDQFHVWKDWOHGWRWKHRULJLQDOVWRSl mFUDFN FRFDLQHl EXW IRXQG QRWKLQJ  2IILFHU *LOOPDQ WRRN
6HH2EDVD)GDWVHHDOVR+D\HV86DW (]HNZHPEDWRWKH5HGIRUG3ROLFH6WDWLRQ2IILFHU+DQLVK
 %HUNHPHU  86 DW   +HUH 2IILFHU +DQLVK WHVWLILHG WKDW 'HIHQGDQW DJUHHG WR DFFRPSDQ\ KLP WR WKH
DGPLWWHG WKDW DIWHU KH TXHVWLRQHG 'HIHQGDQW VHDUFKHG KHU SROLFH VWDWLRQ WR DQVZHU VRPH TXHVWLRQV KRZHYHU KH
SXUVH DQG EDJ DQG SDWWHG KHU GRZQ QRWKLQJ OHG KLP WR DFNQRZOHGJHG WKDW DW QR WLPH EHIRUH HQWHULQJ WKH SROLFH
EHOLHYH WKDW 'HIHQGDQW ZDV LQYROYHG LQ GUXJ DFWLYLW\ VWDWLRQGLGKHLQIRUP'HIHQGDQWWKDWVKHZDVIUHHWROHDYH
7KHUHIRUH DQ\ IXUWKHU GHWHQWLRQ RI 'HIHQGDQW EH\RQG WKLV :KLOH DW WKH VWDWLRQ 2IILFHU +DQLVK UHWXUQHG 'HIHQGDQWjV
SRLQW ZDV LQ YLRODWLRQ RI WKH )RXUWK $PHQGPHQW DQG WKH SXUVHDQGZKLWHSODVWLFEDJFRQWDLQLQJWKHERDUGJDPHDQG
GLVWULFW FRXUW HUURQHRXVO\ FRQFOXGHG WKDW WKH RIILFHUV ZHUH KDG'HIHQGDQWVLWLQWKHOREE\XQWLOWKHDJHQWVFDPHWRWDONWR
OHJDOO\DOORZHGWRDUUHVW'HIHQGDQWDQGVHL]HKHUEDJEDVHG KHU'HIHQGDQWDVNHGWRPDNHDWHOHSKRQHFDOODQG2IILFHU
XSRQUHDVRQDEOHVXVSLFLRQ$JDLQLWLVZHOOHVWDEOLVKHGWKDW +DQLVKDOORZHG'HIHQGDQWWRGRVR
m>Z@KHQDGHWHQWLRQULVHVWRWKHOHYHORIDIXOOIOHGJHGDUUHVW
   WKH )RXUWK $PHQGPHQW GHPDQGV WKDW WKH VHL]XUH EH $ERXWILYHPLQXWHVODWHU/LHXWHQDQW+HLQVDUULYHGDWWKH
VXSSRUWHGE\SUREDEOHFDXVHl6HH*DUGHQVKLUH)GDW VWDWLRQ DQG WRRN 'HIHQGDQW LQWR D SULYDWH URRP RII RI WKH
 OREE\ ZKLFK 2IILFHU +DQLVK GHVFULEHG DV mDQ LQWHUYLHZ
URRPlFRQWDLQLQJDWDEOHDQGDFRXSOHRIFKDLUV/LHXWHQDQW
)XUWKHUPRUH LQ LWV DPHQGHG RSLQLRQ WKH GLVWULFW FRXUW +HLQVDQG'HIHQGDQWKDGDERXWDILIWHHQWRWZHQW\PLQXWH
HUURQHRXVO\IRXQGWKDWWKHSROLFHRIILFHUVKDGSUREDEOHFDXVH FRQYHUVDWLRQLQZKLFK/LHXWHQDQW+HLQVLGHQWLILHGKLPVHOI
DVZHOODV'HIHQGDQWjVFRQVHQWWRVHDUFK'HIHQGDQWjVsHHS H[SODLQHGmZKDWZDVJRLQJRQlDQGDVNHG'HIHQGDQWIRUKHU
&KHURNHH2XUDQDO\VLVQHHGQRWUHDFKWKLVSRLQWLQDVPXFKDV FRRSHUDWLRQLQWKHLQYHVWLJDWLRQ$V/LHXWHQDQW+HLQVDQG
WKHFRQWLQXHGGHWHQWLRQRI'HIHQGDQWSDVWWKHSXUSRVHRIWKH 'HIHQGDQW ZHUH H[LWLQJ WKH LQWHUYLHZ URRP 'HIHQGDQWjV
LQLWLDOVWRSZDVLOOHJDO,QDQ\HYHQWWKHUHFRUGLVQRWFOHDU QLHFH &DURO %XWOHU ZDV HQWHULQJ WKH SROLFH VWDWLRQ
WKDWFRQVHQWZDVJLYHQWRVHDUFK'HIHQGDQWjVYHKLFOHZKHUH /LHXWHQDQW+HLQVVWDWHGWKDWDWWKLVSRLQWLWKDGEHHQDERXW
'HIHQGDQWjVQLHFHWHVWLILHGWKDWWKHRIILFHUVmGHPDQGHGlWKDW RQHKDOI KRXU VLQFH 'HIHQGDQW KDG EHHQ EURXJKW LQWR WKH
VKHXQORFNWKHsHHSDIWHUWKHRIILFHUVXQVXFFHVVIXOO\WULHGWR SROLFHVWDWLRQ
RSHQWKHYHKLFOHWKHPVHOYHVDQGWKHUHLVQRWKLQJWRLQGLFDWH
WKDWFRQVHQWZDVQRQHWKHOHVVYROXQWDULO\JLYHQE\'HIHQGDQW %XWOHUWHVWLILHGIRU'HIHQGDQWDWWULDODQGVWDWHGWKDWVKH
RUKHUQLHFH6HH:LOOLDPV)GDW,QDGGLWLRQ KDGUHFHLYHGDFDOOIURP'HIHQGDQWDVNLQJ%XWOHUWRSLFNKHU
RQFHWKHRIILFHUVOHDUQHGWKDWWKH%DOGHUGDVKJDPHIRXQGLQ
8NRKDjV SRVVHVVLRQ KDG FRFDLQH FRQFHDOHG LQVLGH WKHUHE\
DUJXDEO\SURYLGLQJSUREDEOHFDXVHWREHOLHYHWKDWWKHL@IWKHFRQVHQWLVQRW
RIILFHUVLQIRUPHG%XWOHUWKDW'HIHQGDQWFRXOGQRWOHDYHIRU VXIILFLHQWO\DQDFWRIIUHHZLOOWRSXUJHWKHSULPDU\WDLQWRIWKH
DERXWILIWHHQPLQXWHV%XWOHUOHIWDWWKDWSRLQWZLWKWKHEDJ LOOHJDOGHWHQWLRQ>WKHHYLGHQFH@PXVWEHVXSSUHVVHGDVµIUXLW
DSSDUHQWO\WRJHWDEHYHUDJH RIWKHSRLVRQRXVWUHHjl0RUHRYHURQFHSRVLWLRQHGLQWKH
EDFNRIWKHSDWUROFDU'HIHQGDQWZDVXQDEOHWRYROXQWDULO\
,Q WKH PHDQWLPH 6RXWKILHOG 3ROLFH RIILFHUV KDG EHHQ OHDYHHYHQLILQFOLQHGWRGRVR6HH5LFKDUGVRQ)GDW
UHTXHVWHGWRVWRSWKHJUHHQ(VFRUWLQZKLFK8NRKDKDGOHIWWKH 
,QQ  7KH YHKLFOH ZDV VHDUFKHG DQG WZR DQG RQHKDOI
NLORJUDP EORFNV RI FRFDLQH ZHUH UHFRYHUHG IURP D $OWKRXJKZHEDVHRXUKROGLQJRQWKHSUHPLVHWKDWWKHVWRS
m%DOGHUGDVKlJDPHIRXQGLQDSLHFHRIOXJJDJHLQWKHFDU EHFDPHLOOHJDORQFH'HIHQGDQWZDVSODFHGLQWRWKHEDFNRIWKH
%DFNDWWKH5HGIRUG3ROLFHVWDWLRQ/LHXWHQDQW+HLQVOHDUQHG SDWUROFDUZHQRWHWKDWWKHRIILFHUVjDFWLRQVRIWUDQVSRUWLQJ
DERXWWKHFRFDLQHUHFRYHUHGIURPWKH%DOGHUGDVKJDPHDQG 'HIHQGDQWWRWKHSROLFHVWDWLRQIRUWKHSXUSRVHRIGHWDLQLQJ
UHFDOOHG WKH $@VHDUFKZKLFK
+RZHYHU%XWOHUWHVWLILHGWKDWVKHWROGWKHRIILFHUVWKDWVKH LV UHDVRQDEOH DW LWV LQFHSWLRQ PD\ YLRODWH WKH )RXUWK
KDGWDNHQWKHEDJKRPHWRZKLFKWKHRIILFHUVUHSOLHGWKDWWKH\ $PHQGPHQWE\YLUWXHRILWVLQWROHUDEOHLQWHQVLW\DQGVFRSHl
ZDQWHGWRFKHFNKHUYHKLFOH%XWOHUIXUWKHUWHVWLILHGWKDWXSRQ 7HUU\86DW7KDWLVH[DFWO\ZKDWKDSSHQHGLQWKH
UHDFKLQJWKHYHKLFOHWKHRIILFHUVWULHGXQVXFFHVVIXOO\WRRSHQ FDVH DW KDQG DQG WKH GLVWULFW FRXUW HUUHG LQ FRQFOXGLQJ
WKHGRRUVRWKH\GHPDQGHGWKDWVKHXQORFNWKHYHKLFOHZKLFK RWKHUZLVH
VKHGLG%XWOHUVWDWHGWKDWVKHGLGQRWFRQVHQWWRWKHHQWU\RU
VHDUFKRIWKHYHKLFOHVKHRQO\FRPSOLHGZLWKWKHRUGHU7KH 7KH GLVWULFW FRXUW IRXQG WKDW EHFDXVH WKH RIILFHUV ZKR
WKHGHIHQGDQW@LQWKHEDFNRI RI WKH VWRS H[FHHGHG WKH ERXQGV SHUPLWWHG XQGHU 7HUU\ Y
WKH SROLFHFDUWKH\ZHQWEH\RQGWKHERXQGVRI7HUU\ 2KLR86:HDJUHH
3ODFLQJ >WKH GHIHQGDQW@ LQ WKH SROLFH FUXLVHU QRW RQO\
FRQVWLWXWHG D VHL]XUH DV PHQWLRQHG HDUOLHU EXW DOVR :HUHYLHZDGLVWULFWFRXUWjVIDFWXDOILQGLQJVRQDPRWLRQWR
FURVVHG WKH OLQH LQWR DQ DUUHVW  >7KH GHIHQGDQW@ ZDV VXSSUHVVIRUFOHDUHUURUKRZHYHUDGLVWULFWFRXUWjVDSSOLFDWLRQ
PRYHGIURPKLVFDUWRDQRWKHUORFDWLRQDQGKLVIUHHGRP RIWKHODZWRWKHIDFWVLVUHYLHZHGGHQRYR6HH8QLWHG6WDWHV
RIPRYHPHQWZDVVHYHUHO\UHVWULFWHG Y7KRPDV)GWK&LU

6HH8QLWHG6WDWHVY5LFKDUGVRQ)GWK&LU m6WRS DQG IULVNl FDVHV DUH XOWLPDWHO\ JRYHUQHG E\ WKH
 6XSUHPH&RXUWjVGHFLVLRQLQ7HUU\ZKHUHWKH&RXUWKHOGDV
IROORZV
7KHGLVWULFWFRXUWjVKROGLQJWKDW'HIHQGDQWFRQVHQWHGWRVLW
LQWKHSDWUROFDUDQGWREHWUDQVSRUWHGWRWKHSROLFHVWDWLRQLV >:@KHUH D SROLFH RIILFHU REVHUYHV XQXVXDO FRQGXFW
QRW VXSSRUWHG E\ WKH IDFWV  &RQVHQW LV MXGJHG XQGHU WKH ZKLFKOHDGVKLPUHDVRQDEO\WRFRQFOXGHLQOLJKWRIKLV
WRWDOLW\RIWKHFLUFXPVWDQFHV6HH6FKQHFNORWKY%XVWDPRQWH H[SHULHQFHWKDWFULPLQDODFWLYLW\PD\EHDIRRWDQGWKDW
86m&RQVHQWPXVWEHSURYHGE\FOHDU WKHSHUVRQVZLWKZKRPKHLVGHDOLQJPD\EHDUPHGDQG
DQGSRVLWLYHWHVWLPRQ\DQGPXVWEHXQHTXLYRFDOVSHFLILFDQG SUHVHQWO\GDQJHURXVZKHUHLQWKHFRXUVHRILQYHVWLJDWLQJ
LQWHOOLJHQWO\ JLYHQ XQFRQWDPLQDWHG E\ DQ\ GXUHVV DQG WKLVEHKDYLRUKHLGHQWLILHVKLPVHOIDVDSROLFHPDQDQG
FRHUFLRQl8QLWHG6WDWHVY:LOOLDPV)G PDNHV UHDVRQDEOH LQTXLULHV DQG ZKHUH QRWKLQJ LQ WKH
WK&LU,QWKLVFDVHWKHJRYHUQPHQWIDLOHGWRPHHW LQLWLDO VWDJHV RI WKH HQFRXQWHU VHUYHV WR GLVSHO KLV
WKLVEXUGHQLQFODLPLQJWKDW'HIHQGDQWFRQVHQWHGWRVLWWLQJLQ UHDVRQDEOH IHDU IRU KLV RZQ RU RWKHUVj VDIHW\ KH LV
WKHSROLFHFDUWUDYHOLQJWRWKHSROLFHVWDWLRQUHPDLQLQJDWWKH HQWLWOHGIRUWKHSURWHFWLRQRIKLPVHOIDQGRWKHUVLQWKH
VWDWLRQ DQG DQVZHULQJ TXHVWLRQV  &OHDUO\ XSRQ VHHLQJ DUHD WR FRQGXFW D FDUHIXOO\ OLPLWHG VHDUFK RI WKH RXWHU
(]HNZHPEDEHLQJSK\VLFDOO\IRUFHGLQWRWKHSROLFHFDUE\WKH FORWKLQJ RI VXFK SHUVRQV LQ DQ DWWHPSW WR GLVFRYHU
RIILFHUVLWLVKDUGWRLPDJLQHWKDW'HIHQGDQWZRXOGQRWKDYH ZHDSRQVZKLFKPLJKWEHXVHGWRDVVDXOWKLP
IHOW FRHUFHG WR UHPDLQ LQ 2IILFHU +DQLVKjV SDWURO FDU DQG
 8QLWHG6WDWHVY%XWOHU 1R 1R 8QLWHG6WDWHVY%XWOHU 

86DW,QRWKHUZRUGVXQGHU7HUU\ZKHQDSROLFH 7KH 6XSUHPH &RXUW H[SODLQHG WKH SRLQW DW ZKLFK DQ
RIILFHU UHDVRQDEO\ FRQFOXGHV WKDW FULPLQDO DFWLYLW\ PD\ EH LQYHVWLJDWLYH GHWHQWLRQ WULJJHUV WKH IXOO SURWHFWLRQ RI WKH
DIRRWWKHRIILFHUPD\EULHIO\VWRSWKHVXVSLFLRXVSHUVRQDQG )RXUWK$PHQGPHQWDVIROORZV
PDNHmUHDVRQDEOHLQTXLULHVlDLPHGDWFRQILUPLQJRUGLVSHOOLQJ
KLVVXVSLFLRQVDQGPD\FRQGXFWDSDWGRZQIRUZHDSRQV,G 7KHUHLVQRGRXEWWKDWDWVRPHSRLQWLQWKHLQYHVWLJDWLYH
,Q 0LQQHVRWD Y 'LFNHUVRQ  86    WKH SURFHVV SROLFH SURFHGXUHV FDQ TXDOLWDWLYHO\ DQG
6XSUHPH&RXUWIXUWKHUKHOGWKDWmSROLFHRIILFHUVPD\VHL]H TXDQWLWDWLYHO\EHVRLQWUXVLYHZLWKUHVSHFWWRDVXVSHFWjV
QRQWKUHDWHQLQJ FRQWUDEDQG GHWHFWHG GXULQJ D SURWHFWLYH IUHHGRPRIPRYHPHQWDQGSULYDF\LQWHUHVWVDVWRWULJJHU
SDWGRZQVHDUFKRIWKHVRUWSHUPLWWHGE\7HUU\>@VRORQJ WKH IXOO SURWHFWLRQ RI WKH )RXUWK DQG )RXUWHHQWK
DV WKH RIILFHUVj VHDUFK VWD\V ZLWKLQ WKH ERXQGV PDUNHG E\ $PHQGPHQWV$QGRXUYLHZFRQWLQXHVWREHWKDWWKHOLQH
7HUU\>@l WKHUHE\ HVWDEOLVKLQJ WKH VRFDOOHG mSODLQIHHOl LVFURVVHGZKHQWKHSROLFHZLWKRXWSUREDEOHFDXVHRUD
H[FHSWLRQWRDZDUUDQW ZDUUDQW IRUFLEO\ UHPRYH D SHUVRQ IURP KLV KRPH RU
RWKHUSODFHLQZKLFKKHLVHQWLWOHGWREHDQGWUDQVSRUW
7KH EUHYLW\ DQG OLPLWHG QDWXUH RI 7HUU\W\SH VWRSV KDYH KLPWRWKHSROLFHVWDWLRQZKHUHKHLVGHWDLQHGDOWKRXJK
EHHQ UHSHDWHGO\ DIILUPHG  6HH 8QLWHG 6WDWHV Y 2EDVD  EULHIO\ IRU LQYHVWLJDWLYH SXUSRVHV  :H DGKHUH WR WKH
)GWK&LU7KDWLVWRVD\m>Z@KHQSROLFH YLHZWKDWVXFKVHL]XUHVDWOHDVWZKHUHQRWXQGHUMXGLFLDO
DFWLRQVJREH\RQGFKHFNLQJRXWWKHVXVSLFLRXVFLUFXPVWDQFHV VXSHUYLVLRQ DUH VXIILFLHQWO\ OLNH DUUHVWV WR LQYRNH WKH
WKDWOHGWRWKHRULJLQDOVWRSWKHGHWHQWLRQEHFRPHVDQDUUHVW WUDGLWLRQDOUXOHWKDWDUUHVWVPD\FRQVWLWXWLRQDOO\EHPDGH
WKDWPXVWEHVXSSRUWHGE\SUREDEOHFDXVHl,G,QVKRUWXSRQ RQO\RQSUREDEOHFDXVH
PDNLQJWKHVWRS
+D\HV Y )ORULGD  86    FLWDWLRQV
WKHRIILFHUPD\DVNWKHGHWDLQHHDPRGHUDWHQXPEHURI RPLWWHGHPSKDVLVDGGHG
TXHVWLRQVWRGHWHUPLQHKLVLGHQWLW\DQGWRWU\WRREWDLQ
LQIRUPDWLRQ FRQILUPLQJ RU GLVSHOOLQJ WKH RIILFHUjV $SSO\LQJ WKHVH )RXUWK $PHQGPHQW MXULVSUXGHQWLDO
VXVSLFLRQV%XWWKHGHWDLQHHLVQRWREOLJDWHGWRUHVSRQG SULQFLSOHVWRWKHFDVHDWKDQGZHKROGWKDWWKHGLVWULFWFRXUW
$QGXQOHVVWKHGHWDLQHHjVDQVZHUVSURYLGHWKHRIILFHU HUUHGLQGHQ\LQJ'HIHQGDQWjVPRWLRQWRVXSSUHVVWKHHYLGHQFH
ZLWK SUREDEOH FDXVH WR DUUHVW KLP KH PXVW WKHQ EH ZKHUHXSRQOHDUQLQJ'HIHQGDQWjVLGHQWLW\DQGWKDWVKHZDV
UHOHDVHG QRW DUPHG RU FDUU\LQJ FRQWUDEDQG DV GHWHUPLQHG E\ WKH
SDWGRZQ VHDUFK WKH 5HGIRUG 3ROLFH RIILFHUV XQUHDVRQDEO\
%HUNHPHUY0F&DUW\86IRRWQRWHV VHL]HG 'HIHQGDQW E\ SODFLQJ KHU LQ WKH SROLFH FDU DQG
RPLWWHG  m:KHQ D GHWHQWLRQ ULVHV WR WKH OHYHO RI D IXOO TXHVWLRQLQJKHUIXUWKHUWUDQVSRUWLQJKHUWRWKHSROLFHVWDWLRQ
IOHGJHGDUUHVWWKH)RXUWK$PHQGPHQWGHPDQGVWKDWWKH GHWDLQLQJ 'HIHQGDQW ZKLOH DW WKH SROLFH VWDWLRQ DQG
VHL]XUHEHVXSSRUWHGE\SUREDEOHFDXVHl6HH*DUGHQVKLUHY TXHVWLRQLQJ KHU IXUWKHU RQFH WKHUH  $OWKRXJK WKH RIILFHUV
6FKXEHUW  )G   WK &LU   $ mVHL]XUHl SURSHUO\UHOLHGXSRQWKHEXOOHWLQIURP/LHXWHQDQW+HLQVZKLFK
RFFXUV IRU SXUSRVHV RI WKH )RXUWK $PHQGPHQW ZKHQ WKH LQGLFDWHGWKDW(]HNZHPEDDQG'HIHQGDQWZHUHVXVSHFWHGDV
SROLFH GHWDLQ DQ LQGLYLGXDO XQGHU FLUFXPVWDQFHV ZKHUH D EHLQJLQYROYHGLQGUXJWUDIILFNLQJVRDVWRMXVWLI\WKHLQLWLDO
UHDVRQDEOHSHUVRQZRXOGIHHOWKDWKHRUVKHLVQRWDWOLEHUW\WR VWRSRIWKHFDEVHH8QLWHG6WDWHVY+HQVOH\86
OHDYH6HH8QLWHG6WDWHVY0HQGHQKDOO86 RQFH'HIHQGDQWLGHQWLILHGKHUVHOIDQVZHUHG
 WKHRIILFHUjVTXHVWLRQVDQGFRQVHQWHGWRWKHSDWGRZQZKLFK
GLGQRWUHYHDODQ\WKLQJVXVSLFLRXVWKHRIILFHUVZHUHUHTXLUHG