Logan v. Denny's

Summarize Case

Related Cases

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 1R²'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 $PHULFDQIHPDOHZKRKDGEHHQHPSOR\HGE\'HIHQGDQWDVD VHUYHUIRUPRUHWKDQWHQ\HDUVILOHGDVHYHQFRXQWFRPSODLQW LQ WKH GLVWULFW FRXUW DOOHJLQJ DPRQJ RWKHU WKLQJV WKDW 'HIHQGDQWYLRODWHGKHUFLYLOULJKWVXQGHU7LWOH9,,RIWKH&LYLO 5LJKWV$FWRIE\HQJDJLQJLQGLVFULPLQDWRU\WUHDWPHQW ZKLFKOHGWR3ODLQWLII¶VFRQVWUXFWLYHGLVFKDUJH2Q-XO\ 'HIHQGDQWILOHGDQDQVZHULQUHVSRQVHWRFRXQWVRQH WZRVL[DQGSDUWRIFRXQWVHYHQRI3ODLQWLII¶VFRPSODLQWDQG 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¶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¶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\VLVZKHWKHU'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\RILWLVIURPWKHVDPHDVVLVWDQWPDQDJHUDQG 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'$5'6´RYHUDOODQGSURYLGHVDKDQGZULWWHQFRPPHQW DSSOLHGWKH)DUDJKHUVWDQGDUGLQUDFHFDVHVVLQFHVKRUWO\DIWHU LQGLFDWLQJDUHDVLQZKLFK3ODLQWLIIQHHGHGWRLPSURYHDVZHOO WKDWFDVHZDVGHFLGHG6HHHJ-DFNVRQY4XDQH[&RUS DVWKHFRPPHQW³VLF@JRRGFXVWRPHUUHODWLRQV )G WK&LU  FLWLQJ)DUDJKHUIRUWKH NHHS XS WKH JRRG VHUYLFH´  -$ DW    3ODLQWLII¶V QH[W SURSRVLWLRQ WKDW ³µVLPSOH WHDVLQJ¶ RIIKDQG FRPPHQWV DQG HYDOXDWLRQGDWHG2FWREHUIURP$VVLVWDQW0DQDJHU LVRODWHGLQFLGHQWV´RUGLQDULO\GRQRWDPRXQWWRGLVFULPLQDWLRQ *LQD +LQGH UDWHV 3ODLQWLII DV ³$%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\ HYDOXDWLRQGDWHG2FWREHURIIURPDGLIIHUHQWDVVLVWDQW UDFLDOLQFKDUDFWHU7KHFRPPHQW³ZHGRQ¶WVHUYHJULWVKHUH´ PDQDJHUUDWHV3ODLQWLIIDV³$%29(67$1'$5'6´ ZKLFK HYHQ /RJDQ DGPLWV ZDV PDGH LQ UHVSRQVH WR KHU TXHVWLRQ DERXW WKH DYDLODELOLW\ RI YDULRXV EUHDNIDVW LWHPV 3ODLQWLII¶VQH[WWZRHYDOXDWLRQVGDWHG$XJXVWDQG 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´  $SSDUHQWO\ XQOLNH LQ 3ODLQWLII¶V SUHYLRXV UDFLDOLQQDWXUH,ZRXOGKROGWKDWWKHGLVWULFWFRXUWGLGQRWHUU HYDOXDWLRQV LW ZDV 0DQDJHU &URVV DQG QRW WKH DVVLVWDQW LQGHWHUPLQLQJWKDWWKHUHFRUGVLPSO\GRHVQRWVXSSRUWVXFKD PDQDJHUZKRODWHUVLJQHGWKHHYDOXDWLRQRQ0DUFK FRQFOXVLRQEXWHYHQLILWGLGWKHVHFRPPHQWVGRQRWULVHWR ZKR DFWXDOO\ FRQGXFWHG WKH HYDOXDWLRQ EHFDXVH &URVV¶ WKHOHYHOUHTXLUHGWRFUHDWHDKRVWLOHZRUNHQYLURQPHQW,Q VLJQDWXUH EHDUV WKH VDPH GDWH DV WKDW RI WKH HYDOXDWLRQ )DUDJKHUY%RFD5DWRQ86  WKH6XSUHPH -DQXDU\,QWHUHVWLQJO\KRZHYHUERWK3ODLQWLIIDQG &RXUW PDGH LW FOHDU WKDW D KRVWLOHZRUNHQYLURQPHQW FODLP WKHDVVLVWDQWPDQDJHUZKRDWWKLVSRLQWZDV/LQGD7D\ORUGLG PXVWEHVXSSRUWHGE\HYLGHQFHRIH[WUHPHFRQGXFWDQGWKDW QRWVLJQWKHHYDOXDWLRQXQWLO0DUFKGHVSLWHWKHIDFW WKH³VWDQGDUGVRIMXGJLQJKRVWLOLW\DUHVXIILFLHQWO\GHPDQGLQJ WKDW WKH HYDOXDWLRQ EHDUV WKH -DQXDU\ GDWH DV GRHV &URVV¶ WRHQVXUHWKDW7LWOH9,,GRHVQRWEHFRPHDµJHQHUDOFLYLOLW\ VLJQDWXUH FRGH¶  3URSHUO\ DSSOLHG WKH\ ZLOO ILOWHU RXW FRPSODLQWV DWWDFNLQJµWKHRUGLQDU\WULEXODWLRQVRIWKHZRUNSODFHVXFKDV ,Q)HEUXDU\RI3ODLQWLIIDQGWKHRWKHUHPSOR\HHVRI WKHVSRUDGLFXVHRIDEXVLYHODQJXDJHJHQGHUUHODWHGMRNHV WKH1RUWK5DQGDOOIDFLOLW\ZHUHQRWLILHGWKDW'HIHQGDQWZDV DQGRFFDVLRQDOWHDVLQJ¶´,GDW$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´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³>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 -$DW 7KHODWWHUFRPPHQWZDVPDGH WKXVHIIHFWHGDWUDQVPRJULILFDWLRQRIWKHVWDQGDUGRIUHYLHZ E\3ODLQWLII¶VPDQDJHU*UHJ0DOORQ,QDGGLWLRQ3ODLQWLII DWOHDVWIRU7LWOH9,,GHIHQGDQWVZKLFKPD\KDYHEHHQVXHGIRU FRQWHQGV WKDW WKH ZKLWH VHUYHUV ZHUH SURYLGHG ZLWK PRUH UDFLDOO\ GLVFULPLQDWRU\ SUDFWLFHV DW RWKHU WLPHV DQG XQGHU KRXUV RI HPSOR\PHQW WKDQ VKH ZDV SURYLGHG DQG WKDW WKH GLIIHUHQWFLUFXPVWDQFHV ZKLWHVHUYHUVFRQWLQXDOO\WROG3ODLQWLIIWKDWWKHLUKRXUVZHUH QRWJRLQJWREHFXWEHFDXVHVKHZDVDOORZHGWRWUDQVIHUWR 7KHPDMRULW\RSLQLRQPDNHVQXPHURXVILQGLQJVRIIDFWLQ +LJKODQG +HLJKWV 0RUHRYHU WR WKH EHVW RI 3ODLQWLII¶V UHDFKLQJLWVFRQFOXVLRQWKDWWKHGLVWULFWFRXUWHUUHGLQJUDQWLQJ NQRZOHGJH QR ZKLWH VHUYHUV WUDQVIHUUHG WR WKH +LJKODQG VXPPDU\MXGJPHQWWR'HQQ\¶V,WILQGVIRUH[DPSOHWKDWWKH +HLJKWVIDFLOLW\IURPWKH1RUWK5DQGDOOIDFLOLW\7KHUHZDV MRE FKDQJH RIIHUHG WR /RJDQ ZDV D GHPRWLRQ WKDW /RJDQ RQO\ RQH RWKHU EODFN VHUYHU EHVLGHV 3ODLQWLII DW +LJKODQG ZRXOG KDYH VXIIHUHG D UHGXFWLRQ LQ VDODU\ LQ WKH QHZ DQG +HLJKWVDQGVKHZDVSDUWWLPH OHVVHUSRVLWLRQWKDWWKHMREFKDQJHZDVKXPLOLDWLQJDQGWKDW 'HQQ\¶VGHVLJQDWLRQRI/RJDQ¶VDVVLJQHGVWDWLRQRQ$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±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¶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 ZHOOVHWWOHGWKHFRXUWPXVWYLHZWKHHYLGHQFHLQWKHUHFRUG 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´ -$DW SURFHHGLQJV , XVH WKH ZRUG ³SXUSRUWHG´ WR XQGHUVFRUH WKH LPSURSULHW\ RI WKH PDMRULW\¶V YHQWXULQJ RXWVLGH WKH UHFRUG LQ WKLV FDVH  /RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶V,QF  ,QKHUDIILGDYLW0DU\-DQHGHOD9HJDWKHPDQDJHUWRZKRP :LWKDOOGXHUHVSHFWWRP\SDQHOFROOHDJXHVYLHZLQJWKH 3RSOLQDVVLJQHGWKHWDVNRIUHYLHZLQJWKH(35ZLWK3ODLQWLII HYLGHQFHLQWKHOLJKWPRVWIDYRUDEOHWR/RJDQGRHVQRWSHUPLW SURYLGHGDQDFFRXQWRIKHUPHHWLQJZLWK3ODLQWLIIGHOD9HJD¶V XVDVDUHYLHZLQJFRXUWWRWDNHMXGLFLDOQRWLFHRIIDFWVRIWKH DIILGDYLWLVFRQVLGHUDEO\VKRUWHUWKDQ3RSOLQ¶VDIILGDYLWDQG W\SHQRWLFHGE\WKHPDMRULW\7KHPDMRULW\RSLQLRQVD\VWKDW SURYLGHVLQUHOHYDQWSDUW ³ZH FDQ WDNH MXGLFLDO QRWLFH WKDW D EXVER\ RU µVHUYLFH DVVLVWDQW¶DV'HIHQGDQWHQWLWOHVLWLVDMREFODVVLILFDWLRQEHORZ  7KH(35SUHSDUHGE\0U3RSOLQVWDWHGWKDWLWZDV WKDW RI D ZDLWHU RU VHUYHU SDUWLFXODUO\ DW WKLV W\SH RI EHLQJLVVXHGGXHWRVHUYLFHUHODWHGSHUIRUPDQFHLVVXHV UHVWDXUDQW´  ,Q P\ YLHZ WKH H[DFW VWDWXV RI D ³VHUYLFH DQG WKDW 0V /RJDQ ZDV EHLQJ JLYHQ WKH RSWLRQ RI DVVLVWDQW´RU³EXVER\´DWWKLVSDUWLFXODU'HQQ\¶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¶VXVH RSSRUWXQLW\WRUHDGLWDQGVLJQLW0V/RJDQUHDGWKH RIMXGLFLDOQRWLFHLJQRUHVWKHUHTXLUHPHQWWKDWWKHSDUWLHVKDYH (35DQGWKHQOHIWZLWKRXWVLJQLQJLW WKH RSSRUWXQLW\ WR EH KHDUG ZLWK UHJDUG WR LW 6HH 5RVH Y +DUWIRUG8QGHUZULWHUV,QV&R)G WK&LU -$DW   ³5XOH H UHTXLUHVWKHGLVWULFWFRXUWWRJLYHDSDUW\ 3ODLQWLII SURYLGHV D PXFK GLIIHUHQW DFFRXQW RI ZKDW DQ RSSRUWXQLW\ WR EH KHDUG LI MXGLFLDO QRWLFH LV WDNHQ´  KDSSHQHGRQ$SULO6SHFLILFDOO\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\DWWKHWLPH3ODLQWLIINQRFNHGRQWKHGRRUDQG VKHVDLGWRGHOD9HJD³0DU\-HDQKHOSPHRXWKHUH E .LQGV RI IDFWV $ MXGLFLDOO\ QRWLFHG IDFW PXVW EH RQH QRW ZKHUHLVVWDWLRQHLJKW´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³\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\¶VEULHIUHIHUVUDWKHUWKH 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¶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¶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\¶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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 VWDWHGUHDVRQZDVQRWWKHDFWXDOUHDVRQDQG 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+LFNV86   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 $PHULFDQ 3ODLQWLII ZDV D PHPEHU RI D 7KDW 'HQQ\¶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¶V  /RJDQY'HQQ\¶V,QF 1R 1R /RJDQY'HQQ\¶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¶VJUDQWRIGHIHQGDQW'HQQ\¶V HYLGHQFHWRGHPRQVWUDWHWKDWWKHZRUNLQJFRQGLWLRQVXQGHU PRWLRQIRUVXPPDU\MXGJPHQWRQSODLQWLII/RJDQ¶V7LWOH9,, ZKLFKVKHODERUHGZHUHVRGLIILFXOWWKDWDUHDVRQDEOHSHUVRQ FODLPRIUDFLDOGLVFULPLQDWLRQEDVHGXSRQDOOHJHGFRQVWUXFWLYH VWDQGLQJLQKHUVKRHVZRXOGKDYHIHOWFRPSHOOHGWRUHVLJQ GLVFKDUJH3ODLQWLIIGRHVQRWFKDOOHQJHRQDSSHDOGLVPLVVDORI DQGWKDW'HIHQGDQWLQWHQGHGWRFDXVH3ODLQWLIIWRUHVLJQRUWKDW KHURWKHUFODLPVLQFOXGLQJVWDWHODZFODLPVEDVHGXSRQWKH KHUUHVLJQDWLRQZDVDUHDVRQDEO\IRUHVHHDEOHFRQVHTXHQFHRI VDPH VHW RI IDFWV DVVHUWHG DV D EDVLV IRU KHU 7LWOH 9,, 'HIHQGDQW¶VDFWLRQV FRQVWUXFWLYHGLVFKDUJH DOOHJDWLRQ  7KH PDMRULW\ DFNQRZOHGJHVWKDWWKHGLVWULFWFRXUW +RZHYHU GHVSLWH LWV DFFXUDWH UHFLWDWLRQ RI WKH ODZ WKH GLVWULFWFRXUWHUUHGLQLWVDQDO\VLVEHFDXVHWKHGLVWULFWFRXUW >$@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 $SULO  LQFLGHQW LQ UHODWLRQ WR 3ODLQWLII¶V FRQVWUXFWLYH GLVFKDUJH FODLP ZH KDYH SURSHUO\ EURXJKW WR WKH IRUH WKH HYLGHQFH DGGXFHG E\ 3ODLQWLII LQ WKLV UHJDUG DQG GHPRQVWUDWHG RXU EHOLHI DV WR ZK\ WKH HYLGHQFH LV VXIILFLHQW WR FUHDWH DQ LQIHUHQFH RI GLVFULPLQDWLRQ LQ WKH PLQGV RI D UHDVRQDEOH MXURU 7KLV DQDO\VLV RI FRXUVH LV SUHFLVHO\ WKH W\SH WKDW ZH DUH UHTXLUHG WR PDNH XQGHU D /0 34;4 UHYLHZ DW WKH VXPPDU\ MXGJPHQW VWDJH 800 'H3LHUR Y &LW\ RI 0DFHGRQLD  )G   WK &LU  QRWLQJ WKDW WKH UHYLHZLQJ FRXUW PXVW UHYLHZ DOO RI WKH IDFWV DQG LQIHUHQFHV GUDZQ WKHUHIURP LQ WKH OLJKW PRVW IDYRUDEOH WR WKH QRQPRYLQJ SDUW\  DQG EULQJLQJ HYLGHQFH DGGXFHG E\ 3ODLQWLII EXW HUURQHRXVO\ GLVUHJDUGHG E\ WKH GLVWULFW FRXUW WR WKH IRUH  FDQQRW DFFXUDWHO\ EH FKDUDFWHUL]HG DV IDFW ILQGLQJ ,Q DGGLWLRQ WKH 6HH ,HUDGL Y 0\ODQ /DEV ,QF  )G   Q G &LU PDMRULW\ LQ QR ZD\ LPSOLHV WKDW 'HIHQGDQW PXVW SUHVHQW WKH HYLGHQFH LQ  WDNLQJ MXGLFLDO QRWLFH RI DUWLFOH LQ WKH 1HZ G@ &LU  LQWROHUDEOHZRUNLQJFRQGLWLRQVDVSHUFHLYHGE\DUHDVRQDEOH SHUVRQ´ DQG WKHHPSOR\HUGLGVR³ZLWKWKHLQWHQWLRQRI  :H DUH DOVR WURXEOHG E\ WKH GLVWULFW FRXUW¶VDSSDUHQW IRUFLQJWKHHPSOR\HHWRTXLW´0RRUHY.XND:HOGLQJ FRPSODFHQF\ UHJDUGLQJ 'HIHQGDQW¶V PLVUHSUHVHQWDWLRQV DV 6\V)G WK&LU ³7RGHWHUPLQHLI ZHOO DV WKH GLVWULFW FRXUW¶V RYHUDOO KDQGOLQJ RI WKH FDVH WKHUHLVDFRQVWUXFWLYHGLVFKDUJHERWKWKHHPSOR\HU¶VLQWHQW 'HIHQGDQW¶VSDVWKLVWRU\RIGLVFULPLQDWRU\FRQGXFWERWKWRLWV DQGWKHHPSOR\HH¶VREMHFWLYHIHHOLQJVPXVWEHH[DPLQHG´,G PLQRULW\SDWURQVDQGHPSOR\HHVDOLNHLVZHOONQRZQLQWKH FLWLQJ +HOG Y *XOI 2LO &R  )G   WK &LU MXULVSUXGHQFH DQG SXEOLF IRUXPV  ([DPSOHV RI KLJKO\   SXEOLFL]HG FDVHV LQYROYLQJ 'HIHQGDQW¶V GLVFULPLQDWRU\ FRQGXFW LQFOXGH WZR  FODVV DFWLRQ VXLWV DOOHJLQJ UDFH 7KH)LIWK&LUFXLWKDVVHWIRUWKDQXPEHURIIDFWRUVWKDWD GLVFULPLQDWLRQXQGHU86&†D±'\VRQY)ODJVWDU FRXUWVKRXOGFRQVLGHUIRUSXUSRVHVRIVDWLVI\LQJWKHILUVWSURQJ &RUS &$ 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¶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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\WZRWLPHVRYHUWKHFRXUVHRIQHDUO\ 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 ZDJHULVLQJWRRUZKLOHVHUYHUVEHJDQDWDERXW 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¶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¶V+RQRU&WU 3ODLQWLII¶VMREUHVSRQVLELOLWLHVZHUHUHGXFHGE\FKDQJLQJKHU 86DW MREIURPWKDWRIVHUYHUWREXVER\$V3ODLQWLIIWHVWLILHGWKH EXVER\VZHDUUXEEHUERRWVPRSIORRUVFOHDUDQGOLIWKHDY\ :HDUHIXUWKHUSHUVXDGHGLQWKLVUHJDUGE\WKHWLPLQJRIWKH GLVKHVDQGFOHDQXSDIWHUSHRSOHZKLOHWKHVHUYHUVZDLWRQ 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\RQ0DUFKDQGWKDWZLWKLQWZRZHHNVVKH 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\EHFDXVHLWZDVDIDVWHUSDFHGEUDQFKDQGXQUHIXWHG 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¶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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 WKHGHIHQGDQWLQWHQGHGIRUWKHSODLQWLIIWRUHVLJQ³>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