NGS American v. Jefferson
NGS American v. Jefferson
Opinion
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*6 $0(5,&$1 ,1& ; 3ODLQWLII$SSHOODQW 1R Y ! 0,&.(< s())(5621 UHSUHVHQWDWLYHRI(VWDWHRI %HUQHWWDsHIIHUVRQ'HFHDVHG $1'5(: s())(5621DQG 67(3+$1 /$0%PLQRUVE\ WKHLUJXDUGLDQ0LFNH\ sHIIHUVRQ DQG0,&.(< s())(5621LQGLYLGXDOO\ 'HIHQGDQWV$SSHOOHHV 1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH(DVWHUQ'LVWULFWRI0LFKLJDQDW'HWURLW 1R n%HUQDUG$)ULHGPDQ'LVWULFWsXGJH $UJXHG 'HFHPEHU 'HFLGHGDQG)LOHG sXO\
1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R
%HIRUH %2**6DQG68+5+(,15,&+&LUFXLWsXGJHV DQG32/67(5 'LVWULFWsXGJH BBBBBBBBBBBBBBBBB &2816(/ $5*8(' 5RQDOG6/RQJKRIHU+21,*0$10,//(5 6&+:$57= &2+1 'HWURLW 0LFKLJDQ IRU $SSHOODQW sRQDWKDQ 0 3DYVQHU /$: 2)),&(6 2) 6+(/'21 s 6&+/(6,1*(5 )W /DXGHUGDOH )ORULGD IRU $SSHOOHH 21%5,() 5RQDOG6/RQJKRIHU5D\PRQG0.HWKOHGJH +21,*0$1 0,//(5 6&+:$57= &2+1 'HWURLW 0LFKLJDQ IRU $SSHOODQW sRQDWKDQ 0 3DYVQHU /$: 2)),&(62)6+(/'21s6&+/(6,1*(5)W/DXGHUGDOH )ORULGDIRU$SSHOOHH BBBBBBBBBBBBBBBBB 23,1,21 BBBBBBBBBBBBBBBBB %2**6&LUFXLWsXGJH1*6$PHULFDQ,QF m1*6l LV D0LFKLJDQEDVHGWKLUGSDUW\DGPLQLVWUDWRURIWKH)OLQW,QN &RUSRUDWLRQ (PSOR\HHV *URXS 0HGLFDO %HQHILW 3ODQ mWKH 3ODQl LQ)ORULGD0LFNH\sHIIHUVRQjVZLIH%HUQHWWDUHFHLYHG VHUYLFHV DV D EHQHILFLDU\ XQGHU WKH 3ODQ 6KH GLHG LQ WKH KRVSLWDOWZRZHHNVDIWHUJLYLQJELUWKWRWKHsHIIHUVRQVjVRQRI D FRQGLWLRQ WKDW 0LFNH\ sHIIHUVRQ FODLPV ZDV UHDGLO\ GHWHFWDEOHDQGWUHDWDEOH2Q1RYHPEHU sHIIHUVRQ VHUYHG1*6DQGWKHKHDOWKFDUHSURYLGHUVZKRKHFODLPVZHUH UHVSRQVLEOH IRU KLV ZLIHjV GHDWK ZLWK D SUHVXLW 1RWLFH RI ,QWHQWWR,QLWLDWH/LWLJDWLRQDVUHTXLUHGE\)ORULGDVWDWHODZLQ
7KH +RQRUDEOH 'DQ $DURQ 3ROVWHU 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU WKH 1RUWKHUQ 'LVWULFW RI 2KLR VLWWLQJ E\ GHVLJQDWLRQ 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
PHGLFDOPDOSUDFWLFHODZVXLWV7KHQRWLFHLQIRUPHG1*6RI WKH LPPLQHQW VXLW IRU IDLOXUH WR PRQLWRU DQG WUHDW DSSURSULDWHO\IDLOXUHWRGLDJQRVHWKHSDWLHQWjVWUXHFRQGLWLRQ DQGIRUGLVFRXUDJLQJWKHKHDOWKFDUHSURYLGHUVIURPLQFXUULQJ FRVWVIRUQHFHVVDU\WUHDWPHQW $SSDUHQWO\ HQHUJL]HG E\ WKDW QRWLFH 1*6 EURXJKW VXLW DJDLQVWsHIIHUVRQLQIHGHUDOFRXUWLQ0LFKLJDQRQ'HFHPEHU VHHNLQJ D GHFODUDWLRQ WKDW DQ\ VWDWHFRXUW FODLPV ZRXOGEHSUHHPSWHGXQGHU 86&WKH(PSOR\HH 5HWLUHPHQW ,QFRPH 6HFXULW\ $FW SUHHPSWLRQ SURYLVLRQ sHIIHUVRQILOHGVXLWLQ'DGH&RXQW\)ORULGDFRXUWLQsDQXDU\ %HFDXVH)ORULGDODZUHTXLUHVD GD\ZDLWLQJSHULRG EHWZHHQJLYLQJQRWLFHDQGILOLQJVXLWLQPHGLFDOPDOSUDFWLFH FDVHV 1*6 EURXJKW VXLW LQ IHGHUDO FRXUW EHIRUH sHIIHUVRQ FRXOGOHJDOO\ILOHKLVVWDWHFRXUWDFWLRQsHIIHUVRQPRYHGWR GLVPLVV 1*6jV DFWLRQ IRU ODFN RI SHUVRQDO MXULVGLFWLRQ EHFDXVHKHOLYHVLQ)ORULGDDQGKDVQRWLHVWR0LFKLJDQ1*6 UHVSRQGHG WKDW WKH (5,6$ QDWLRQZLGH VHUYLFH RI SURFHVV SURYLVLRQ VXIILFHV WR HVWDEOLVK SHUVRQDO MXULVGLFWLRQ LQ DQ DFWLRQ WR HQIRUFH (5,6$jV SUHHPSWLRQ SURYLVLRQ 7KH
m$IWHU FRPSOHWLRQ RI SUHVXLW LQYHVWLJDWLRQ SXUVXDQW WR DQG SULRU WR ILOLQJ D FODLP IRU PHGLFDO PDOSUDFWLFH D FODLPDQW VKDOO QRWLI\ HDFK SURVSHFWLYH GHIHQGDQW RI LQWHQW WR LQLWLDWH OLWLJDWLRQ IRU PHGLFDO PDOSUDFWLFHl ) /$ 67$7 $11 :HVW m1R VXLW PD\ EH ILOHG IRU D SHULRG RI GD\V DIWHU QRWLFH LV PDLOHG WR DQ\ SURVSHFWLYH GHIHQGDQWl ) /$ 7$7 6 $11 D :HVW $OWHUQDWLYHO\ sHIIHUVRQ FRXOG KDYH ILOHG VXLW DV VRRQ DV 1*6 QRWLILHG KLP LQ ZULWLQJ WKDW LW UHMHFWHG KLV FODLP EXW VLQFH 1*6 ILOHG VXLW LQ IHGHUDO FRXUW RQ WKH VDPH GD\ LW QRWLILHG sHIIHUVRQ WKDW LW ZDV UHMHFWLQJ KLV FODLP WKDW RSWLRQ ZDV HIIHFWLYHO\ IRUHFORVHG $00 ) /$ ,9 5 & 3 G
(5,6$jV QDWLRQZLGH VHUYLFH RI SURFHVV SURYLVLRQ 86& H VWDWHV m:KHUH DQ DFWLRQ XQGHU WKLV VXEFKDSWHU LV EURXJKW LQ D GLVWULFW FRXUW RI WKH 8QLWHG 6WDWHV LW PD\ EH EURXJKW LQ WKH GLVWULFW ZKHUH WKH SODQ LV DGPLQLVWHUHG ZKHUH WKH EUHDFK WRRN SODFH RU ZKHUH D GHIHQGDQW UHVLGHV RU PD\ EH IRXQG DQG SURFHVV PD\ EH VHUYHG LQ DQ\ RWKHU GLVWULFW ZKHUH D GHIHQGDQW UHVLGHV RU PD\ EH IRXQGl 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
GLVWULFWFRXUWKHOGDKHDULQJDQGRUGHUHGVXSSOHPHQWDOEULHILQJ MXULVGLFWLRQ RYHU sHIIHUVRQ WKDW LW ZRXOG QHHG LQ RUGHU WR RQDQLVVXHUDLVHGWKHUHLQ%RWKSDUWLHVFRPSOLHGDQG1*6 GHFLGH WKH XQGHUO\LQJ (5,6$ SUHHPSWLRQ TXHVWLRQ RQ WKH DOVR ILOHG DQ $PHQGHG &RPSODLQW VHHNLQJ DQ LQMXQFWLRQ PHULWV7KDWTXHVWLRQZLOOKDYHWREHGHFLGHGLQVWDWHFRXUW EDUULQJ SURVHFXWLRQ RI sHIIHUVRQjV VWDWHFRXUW FODLPV LQ RUSHUKDSVLQDIHGHUDOIRUXPWKDWKDVSHUVRQDOMXULVGLFWLRQ DGGLWLRQWRGHFODUDWRU\UHOLHI RYHUsHIIHUVRQ:KHWKHURUQRWWKLVFDVHPD\SURFHHGWRD GHFLVLRQRQWKHPHULWVLQVWDWHFRXUWZLOOGHSHQGXSRQZKHWKHU ,QD6HSWHPEHU RUGHUWKHGLVWULFWFRXUWKHOGWKDW sHIIHUVRQjV FODLPV DUH FRPSOHWHO\ SUHHPSWHG DQG WKXV H GRHVQRWDSSO\WR1*6jVFDVHDQGGLVPLVVHGLW UHPRYDEOH ZKHWKHUSUHHPSWLRQLVMXVWDGHIHQVH DQGWKXV IRUODFNRISHUVRQDOMXULVGLFWLRQ7KHTXHVWLRQSUHVHQWHGRQ QRWDEDVLVIRUUHPRYDO RUZKHWKHUWKH\DUHQRWSUHHPSWHGDW DSSHDO LV ZKHWKHU WKH GLVWULFW FRXUW HUUHG LQ GHFLGLQJ WKDW DOO6HH,QUH86+HDOWKFDUH,QF )G G&LU (5,6$jVQDWLRQZLGHVHUYLFHRISURFHVVSURYLVLRQ GRHV QRW :KLFKHYHULVWKHFDVHDQDFWLRQIRULQMXQFWLYHDQG VXIILFHWRHVWDEOLVKSHUVRQDOMXULVGLFWLRQRYHUsHIIHUVRQLQWKLV GHFODUDWRU\UHOLHILQ0LFKLJDQIHGHUDOGLVWULFWFRXUWWRGHFLGH FDVH1*6DVVHUWVWKDWLWLVDILGXFLDU\DQGWKDWLWVDFWLRQ WKHUHPRYDOTXHVWLRQLVLQDSSURSULDWH VHHNLQJ LQMXQFWLYH DQG GHFODUDWRU\ UHOLHI KDV EHHQ EURXJKW XQGHU D WRHQIRUFH 86&ZKLFKVWDWHV 7KHGLVWULFWFRXUWFRUUHFWO\GHWHUPLQHGWKDWLWODFNVSHUVRQDO WKDW(5,6$mVKDOOVXSHUVHGHDQ\DQGDOO6WDWHODZVLQVRIDUDV MXULVGLFWLRQLQWKLVFDVHWKRXJKWKHFRPSOHWHUHDVRQLVDELW WKH\ PD\ QRZ RU KHUHDIWHU UHODWH WR DQ\ HPSOR\HH EHQHILW PRUHFRPSOLFDWHGWKDQWKDWJLYHQE\WKHGLVWULFWFRXUW1*6 SODQ l 86& D sHIIHUVRQ UHVSRQGV WKDW DVVHUWV WKDW SHUVRQDO MXULVGLFWLRQ H[LVWV E\ ZD\ RI D 1*6jVVWDWXVDVDQ(5,6$ILGXFLDU\DQGWKHH[LVWHQFHRIDQ QDWLRQZLGHVHUYLFHRISURFHVVSURYLVLRQLQWKHVWDWXWHXQGHU HPSOR\HH EHQHILW SODQ JRYHUQHG E\ (5,6$ KDYH QRW EHHQ ZKLFK LW EULQJV LWV DFWLRQ +RZHYHU WKH DFWLRQ 1*6 KDV SURYHQsHIIHUVRQDOVR GHQLHVWKDW D DXWKRUL]HV EURXJKWSXUSRUWVWRHQIRUFHWKHSUHHPSWLRQSURYLVLRQRIWKDW 1*6jV DFWLRQ DQG QRWHV WKDW 1*6 KDV UDLVHG WKH (5,6$ VDPHVWDWXWH7KHSUHHPSWLRQSURYLVLRQLWVHOIGRHV SUHHPSWLRQLVVXHLQLWVPRWLRQWRGLVPLVVWKH)ORULGDODZVXLW QRWFUHDWHDIHGHUDOFDXVHRIDFWLRQ(QIRUFLQJSUHHPSWLRQ ZKLFKWKHVWDWHFRXUWKDVVWD\HGSHQGLQJWKHUHVROXWLRQRIWKLV PD\ EHFRPH D IHGHUDO FDXVH RI DFWLRQ XQGHU VRPH DSSHDO FLUFXPVWDQFHV EXW QRW KHUH 0LFNH\ sHIIHUVRQ KDV GRQH QRWKLQJWRYLRODWH(5,6$E\ILOLQJVXLWLQ)ORULGDVWDWHFRXUW 7KLVFRXUWUHYLHZVGHQRYRWKHGLVWULFWFRXUWjVGLVPLVVDOIRU VR1*6$PHULFDQjVDFWLRQDJDLQVWKLPFDQQRWEHFRQVWUXHG ODFNRISHUVRQDOMXULVGLFWLRQ6HH1DWLRQZLGH0XW/LIH,QV WR HQIRUFH(5,6$7KHUHIRUHWKHMXGJPHQWRIWKHGLVWULFW &RY7U\J,QWjO,QV&R )G WK&LU FRXUWLV$)),50(' 6LQFH ZH XOWLPDWHO\ FRQFOXGH WKDW WKH GLVWULFW FRXUW ODFNHG MXULVGLFWLRQRYHUsHIIHUVRQZHPHUHO\DVVXPHIRUSXUSRVHVRI DQDO\VLV WKDW 1*6 LV D ILGXFLDU\ DQG WKDW (5,6$ JRYHUQV sHIIHUVRQjVEHQHILWSODQ%HFDXVHZHDJUHHZLWKWKHGLVWULFW FRXUW WKDW 1*6jV DFWLRQ LQ QR ZD\ HQIRUFHV DQ (5,6$ SURYLVLRQ DQG LV QRW mDQ DFWLRQ XQGHU WKLV VXEFKDSWHUl WR ZKLFKSHUVRQDOMXULVGLFWLRQPLJKWDWWDFKZHDIILUP , $VDQLQLWLDOPDWWHUZHQRWHWKDWIHGHUDOFRXUWVIURZQXSRQ GHFODUDWRU\MXGJPHQWDFWLRQVEURXJKWIRUSURFHGXUDOIHQFLQJ 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
(YHQ LI 1*6 LV ULJKW WKDW WKH VWDWH ODZ XSRQ ZKLFK SXUSRVHV6HH$OOVWDWH,QV&RY0HUFLHU )G sHIIHUVRQ EDVHV KLV VXLW LV SUHHPSWHG E\ WKDW RQO\ WK&LU OLVWLQJµSURFHGXUDOIHQFLQJjDQGSURYLGLQJµDQ SURYLGHV1*6DGHIHQVHWREHUDLVHGLQVWDWHFRXUWQRWDEDVLV DUHQD IRU D UDFH IRU UHV MXGLFDWDj DV IDFWRUV WR FRQVLGHU LQ IRUIHGHUDOMXULVGLFWLRQDQGWKXVQRWDEDVLVIRUUHPRYDO GHFOLQLQJWRUHQGHUDSUD\HGIRUGHFODUDWLRQ )DFWRUV(WF ,QF Y 3UR $UWV ,QF )G G &LU 5HPRYDODQGSUHHPSWLRQDUHWZRGLVWLQFWFRQFHSWVm7KH m:KHQWKHGHFODUDWRU\MXGJPHQWDFWLRQKDVEHHQWULJJHUHGE\ IDFW WKDW D GHIHQGDQW PLJKW XOWLPDWHO\ SURYH WKDW D DQRWLFH>RIVXLW@OHWWHUWKLVHTXLWDEOHFRQVLGHUDWLRQPD\EHD SODLQWLIIjVFODLPVDUHSUHHPSWHGlnIRUH[DPSOHXQGHU IDFWRULQWKHGHFLVLRQWRDOORZWKHODWHUILOHGDFWLRQWRSURFHHG D nmGRHVQRWHVWDEOLVKWKDWWKH\DUHUHPRYDEOH WR MXGJPHQW LQ WKH SODLQWLIIVj FKRVHQ IRUXPl 6WXUJH Y WRIHGHUDOFRXUWl7KHIHGHUDOSUHHPSWLRQGHIHQVHLQVXFK 'LYHUVLILHG7UDQVS&RUS)6XSS 6'1< QRQUHPRYDEOHFDVHVZRXOGEHGHFLGHGLQVWDWHFRXUWDQG GLVPLVVLQJ ZLWKRXW SUHMXGLFH DQ DFWLRQ ILOHG E\ ZRXOG EH VXEMHFW WR UHYLHZ RQ FHUWLRUDUL LQ WKH 86 XQGHUZULWHUVVHHNLQJGHFODUDWLRQRIQROLDELOLW\XQGHUDQRLO 6XSUHPH&RXUW VSLOOFOHDQXSSROLF\ZKHUHWKHFRQWUDFWRUVjJLYLQJQRWLFHRI VXLWLQVWDWHFRXUWWRWKHXQGHUZULWHUVWULJJHUHGWKHDFWLRQjV :DUQHU)GDWFLWLQJ&DWHUSLOODU,QFY:LOOLDPV ILOLQJDQGWKHFODLPVZHUHHVVHQWLDOO\GHIHQVHVDVVHUWDEOHLQ 86 VHHDOVR=XQLJDY%OXH&URVVDQG VWDWHFRXUW 'UHVVHU,QGXV,QFY,QVXUDQFH&RRI1RUWK %OXH6KLHOGRI0LFK)G WK&LU $P)6XSS 1'7H[ QRWLQJWKDWWKH DSSO\LQJ:DUQHU ,QJHUVROO5DQG&RY0F&OHQGRQ 'HFODUDWRU\sXGJPHQW$FWDIIRUGVDQHZIRUPRIUHOLHIZKHUH 86 KROGLQJ D VWDWH ODZ FODLP WR KDYH EHHQ QHHGHGQRWDQHZFKRLFHRIWULEXQDOVRUWKHDELOLW\WRGUDZ FRPSOHWHO\SUHHPSWHGXSRQWDNLQJWKHFDVHE\FHUWLRUDULIURP LQWR IHGHUDO FRXUWV WKH DGMXGLFDWLRQ RI FDXVHV SURSHUO\ WKH7H[DV6XSUHPH&RXUW FRJQL]DEOHE\VWDWHFRXUWV HPSKDVLVDGGHG )LUVW)HG6DY /RDQ$VVjQRI%RZOLQJ*UHHQ.\Y0F5H\QROGV ) 7KXV LQ QR ZD\ ZRXOG 1*6jV VXLW IRU LQMXQFWLYH DQG 6XSS :' .\ QRWLQJ WKDW WKH GHFODUDWRU\UHOLHImWRHQIRUFHlHYHUMXVWLI\HQMRLQLQJ 'HFODUDWRU\sXGJPHQW$FWGRHVQRWSHUPLWDSDUW\WRLQYRNH WKHVWDWHSURFHHGLQJ,QGHHGWKHVWDWHSURFHHGLQJLVZKHUH WKHMXULVGLFWLRQRIWKHIHGHUDOFRXUWVE\VLPSO\FRPPHQFLQJ WKH (5,6$ SUHHPSWLRQ TXHVWLRQ ZLOO RUGLQDULO\ EH DGHFODUDWRU\MXGJPHQWDFWLRQEHIRUHWKHRWKHUSDUW\LVDEOHWR GHWHUPLQHG (YHQ LI sHIIHUVRQjV VWDWH FRXUW DFWLRQ LV FRPPHQFHLWVQRQUHPRYDEOHFRHUFLYHDFWLRQLQVWDWHFRXUW FRPSOHWHO\ SUHHPSWHG E\ (5,6$ VR WKDW D VWDWH FRXUWjV 6HHJHQHUDOO\$&+$5/(6 $ :5,*+7 (7 $/)('(5$/ LQVLVWHQFHXSRQKHDULQJWKHFODLPZRXOGEHDMXULVGLFWLRQDO 35$&7,&( $1' 352&('85( GHG s$0(6 HUURUDQGQRWPHUHO\DIDLOXUHWRDSSO\WKHFRUUHFWFDVHODZ :0 0225( (7 $/ 0225(j6 )('(5$/ 35$&7,&( 1*6jV FODLP LQ IHGHUDO FRXUW ZRXOG QRW EH DQ DFWLRQ mWR >@ GHG HQIRUFHl,WZRXOGEHDQDFWLRQWRHQIRUFHWKHLPSOLFLW SUHHPSWLRQRI D $QGHYHQWKHQVHHNLQJUHPRYDO ,QHVVHQFH1*6VHHNVDIHGHUDOIRUXPIRUGHWHUPLQDWLRQRI ZRXOGEHWKHSURSHUZD\IRU1*6WRGHIHQGLWVULJKWVXQGHU WKH (5,6$ SUHHPSWLRQ LVVXH LQ WKH XQGHUO\LQJ VWDWHFRXUW IHGHUDOODZ FDVH (YHQ LI 1*6 ZHUH HQWLWOHG WR D IHGHUDO IRUXP DV D PDWWHU RI ODZ LWV PDQQHU RI YLQGLFDWLQJ WKDW ULJKW LV QRW ,,, LPPDWHULDO 5HPRYDO LV WKH VWDQGDUG PHWKRG WR VHHN WKH KHDULQJRIDIHGHUDOFODLPLQDIHGHUDOUDWKHUWKDQDVWDWHFRXUW 1*6jVFXUUHQWDFWLRQLVQRWEURXJKWXQGHU(5,6$ 7KH 1*6SXUSRUWVWRHQIRUFH(5,6$SUHHPSWLRQYLDLWVDFWLRQIRU QDWLRQZLGH VHUYLFH RI SURFHVV SURYLVLRQ LV WKXV QRW LQMXQFWLYHDQGGHFODUDWRU\UHOLHIEXWVXFKUHOLHIFRXOGRQO\ LPSOLFDWHGDQGWKHGLVWULFWFRXUWGLGQRWKDYHWKHSHUVRQDO 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
HYHU EH DSSURSULDWH ZKHQ UHPRYDO LV PDQGDWRU\ LI WKHQ :DUQHUY)RUG0RWRU&R)G WK&LU 7KXV 1*6 HIIHFWLYHO\ VHHNV D UHPRYDO GHWHUPLQDWLRQ LQ D HQ EDQF 7KH (5,6$ SURYLVLRQ WKDW 1*6 SXUSRUWV WR EH IRUXPRWKHUWKDQmWKHGLVWULFWFRXUWRIWKH8QLWHG6WDWHVIRU HQIRUFLQJLVDSURYLVLRQWKDWWKLVFRXUWKDVGHWHUPLQHG WKHGLVWULFWDQGGLYLVLRQZLWKLQZKLFK>WKHVWDWHFRXUW@DFWLRQ mGRHV QRW FUHDWH D IHGHUDO FDXVH RI DFWLRQ LWVHOIl ,ELG ,W LVSHQGLQJlLQFRQWUDYHQWLRQRIWKHIHGHUDOUHPRYDOVWDWXWH ZRXOGWKXVEHDQRPDORXVLIDQDFWLRQWRHQIRUFHZHUH 86& D 7KDWLVSURFHGXUDOIHQFLQJWDNHQWRWKH DIHGHUDOFDXVHRIDFWLRQ*LYHQWKDWsHIIHUVRQjVEULQJLQJD H[WUHPH $OWKRXJK WKH (LJKWK &LUFXLW KDV HQWHUWDLQHG D VWDWHFRXUWVXLWGRHVQRWYLRODWH1*6jVDFWLRQWREORFN GHFODUDWRU\ DFWLRQ VLPLODU WR WKH RQH EURXJKW E\ 1*6 WKDWVXLWFDQQRWHQIRUFH SHUVRQDOMXULVGLFWLRQZDVQRWDWLVVXHWKHUHWKHFRXUWZDVWKH VDPH LQ ZKLFK UHPRYDO ZRXOG EH VRXJKW DQG WKH FRXUW )RU VLPLODU UHDVRQV WKH 6HYHQWK &LUFXLW KDV KHOG WKDW D GHWHUPLQHG WKDW WKH SODLQWLIIjV DFWLRQ GLG QRW UHSUHVHQW mDQ ILGXFLDU\jVGHFODUDWRU\VXLWGRHVQRWHQIRUFH(5,6$,QWKDW LPSURSHUXVHRIWKHGHFODUDWRU\MXGJPHQWWRVHHNDIDYRUDEOH FDVH DQ HPSOR\HU VRXJKW D GHFODUDWRU\ MXGJPHQW WKDW DQ IRUXPl3UXGHQWLDO,QV&RRI$PY'RH)G HPSOR\HHZDVQRWHQWLWOHGWRDGLVDELOLW\SHQVLRQJRYHUQHGE\ WK&LU m'RH,,l %XWVHH,QWHUQDWLRQDO$VVRFRI (5,6$7KHHPSOR\HHVRXJKWDFRXQWHUGHFODUDWLRQWKDWKH (QWUHSUHQHXUVRI$PY$QJRII)G WK&LU ZDVVRHQWLWOHG$OWKRXJKLWGHHPHGWKHHPSOR\HU DVSODQ UHIXVLQJ WR LVVXH D GHFODUDWRU\ MXGJPHQW DIWHU DQ DGPLQLVWUDWRU DILGXFLDU\IRUSXUSRVHVRI D WKH XQVXFFHVVIXO UHPRYDO DWWHPSW DQG KROGLQJ WKDW mWKH FRXUWQRWHGWKDWWKHILGXFLDU\ZDVmQRWVHHNLQJWRµHQIRUFHj 'HFODUDWRU\sXGJPHQW$FWLVQRWWREHXVHGWREULQJWRWKH DQ\ SURYLVLRQ RI (5,6$ RU WKH 3ODQ >7KH HPSOR\HH@ D IHGHUDOFRXUWVDQDIILUPDWLYHGHIHQVHZKLFKFDQEHDVVHUWHGLQ ZRXOGEHSHQVLRQHU>ZD@VQjWYLRODWLQJWKH3ODQRU(5,6$VR DSHQGLQJVWDWHDFWLRQl WKHUH >ZDV@ QRWKLQJ WR µHQIRUFHj DJDLQVW KLPl 0DVVH\ )HUJXVRQ)GDW7KHVDPHPD\EHVDLGRI1*6jV :LWKRXW SUHWHQGLQJ WR GLYLQH WKH PRWLYHV RI 1*6 LQ VXLWLQWKLVFDVHsHIIHUVRQKDVQRWYLRODWHGWKH3ODQRU(5,6$ EULQJLQJWKLVDFWLRQZKHUHLWGLGWKLVFRXUWPD\QHYHUWKHOHVV E\PHUHO\ILOLQJVXLWVRWKHUHLVQRWKLQJIRU1*6WRHQIRUFH WDNHQRWHWKDWDUXOHSHUPLWWLQJWKHDFWLRQFRXOGIUXVWUDWHD XQGHUWKHDHJLVRI D SODLQWLIIjVFKRLFHRIIRUXPDQGHQFRXUDJHIRUXPVKRSSLQJ UDFHVWRWKHFRXUWKRXVHQHHGOHVVOLWLJDWLRQRFFDVLRQLQJZDVWH )ORULGDVWDWHFRXUWVDUHFRPSHWHQWWRGHFLGHZKHWKHU(5,6$ RIMXGLFLDOUHVRXUFHVGHOD\LQWKHUHVROXWLRQRIFRQWURYHUVLHV KDV SUHHPSWHG sHIIHUVRQjV VWDWH ODZ FODLPV 1HLWKHU WKH DQG PLVXVH RI MXGLFLDO SURFHVV WR KDUDVV DQ RSSRQHQW LQ QDWLRQZLGHVHUYLFHRISURFHVVSURYLVLRQ H QRUWKH OLWLJDWLRQ1*6LQWLPDWHVWKDW&RQJUHVVKDVDOUHDG\SHUPLWWHG (5,6$SUHHPSWLRQSURYLVLRQSUHFOXGHVVWDWHFRXUW DQ\VXFKLOOHIIHFWVEHFDXVH(5,6$SURYLGHVIRULQMXQFWLYH DGMXGLFDWLRQRID(5,6$SUHHPSWLRQGHIHQVH6WDWH UHOLHI H[SOLFLWO\ DQG GHFODUDWRU\ UHOLHI LPSOLFLWO\ 7KH FRXUWVODFNMXULVGLFWLRQWRDGMXGJH(5,6$FDVHVRQWKHPHULWV H[WHQWRIVXFKSURYLVLRQUHPDLQVWREHGHWHUPLQHGEXWZH DQG WKXV UHPRYDO LV PDQGDWRU\ RQO\ ZKHQ WKH VWDWH ODZ H[SHFW&RQJUHVVZRXOGPRUHFOHDUO\LQGLFDWHWKDWDVWDWXWH FODLPVDUHFRPSOHWHO\SUHHPSWHGXQGHU6HH:DUQHU LPSLQJHVRQUHPRYDOMXULVGLFWLRQWKDQLWKDVLQ(5,6$jVWH[W )GDW 3DUUDYsRKQ$OGHQ/LIH,QV&R)6XSS HVSHFLDOO\ZKHUHDQLQWHUSUHWDWLRQDOORZLQJVXFKLPSLQJHPHQW G 6')OD ,I(5,6$GRHVQRWSURKLELW UDLVHVIXUWKHUTXHVWLRQVDERXWWKHVFRSHRIWKH$QWL,QMXQFWLRQ WKHILOLQJRISUHHPSWHGFODLPVLQVWDWHFRXUWWKHQLQMXQFWLYH $FWDQGDEVWHQWLRQXQGHU<RXQJHUDQGLWVSURJHQ\6HH DQGGHFODUDWRU\UHOLHIDJDLQVWWKRVHVWDWHFRXUWSURFHHGLQJVLV 86& <RXQJHUY+DUULV86 VHH QRWDYDLODEOHXQGHU(5,6$ 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
SUHYHQW DQ DZDUG DJDLQVW LW XQGHU SUHHPSWHG )ORULGD ODZl DOVRsXLGLFHY9DLO86 H[WHQGLQJ<RXQJHU 1*6jVEULHIDW 7KHTXHVWLRQLQ7KLRNROZDVZKHWKHUWKH WRDOOIHGHUDOFLYLOSURFHHGLQJV SODLQWLIIjVDFWLRQIRUGHFODUDWRU\DQGLQMXQFWLYHUHOLHIFDPH XQGHU D 7KHGLVWULFWFRXUWKDGGHWHUPLQHGWKDWLW 6RPH FRXUWV KDYH WDNHQ WKH DEVWHQWLRQ URXWH WR WKZDUW ODFNHG MXULVGLFWLRQ WR GHFLGH ZKHWKHU (5,6$ SUHHPSWHG D SURFHGXUDOIHQFLQJLQWKH(5,6$FRQWH[W6HH3UXGHQWLDO,QV VWDWHWD[ODZ7KLVFRXUWUHYHUVHGKROGLQJWKDWWKHGLVWULFW &RRI$PY'RH)G WK&LU m'RH,l FRXUW KDG MXULVGLFWLRQ XQGHU D 7KLRNRO LV QRW DQG 'RH ,, )G DW KROGLQJ WKDW WKH 'HFODUDWRU\ FRQWUROOLQJ DV WR ZKHWKHU WKH LQVWDQW DFWLRQ FRPHV XQGHU s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s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sXGJPHQW $FW ZKLFK RQO\ H[WHQGV D QHZ UHPHG\ WR FDVHV & &RPSOHWH 3UHHPSWLRQ DQG 6XLWV WR (QIRUFH WKH DOUHDG\ mZLWKLQ >D FRXUWjV@ MXULVGLFWLRQl DV D EDVLV IRU WKH 3UHHPSWLYH(IIHFWRI GLVWULFW FRXUWjV MXULVGLFWLRQ RYHU sHIIHUVRQ 86& D *LYHQWKHVWULFWXUHVRIWKH'HFODUDWRU\sXGJPHQW 2QLWVIDFHGRHVQRWSURKLELWILOLQJDVWDWHODZFODLP $FW 1*6jV GHFODUDWRU\ DFWLRQ PD\ SURFHHG LI DW DOO RQO\ SUHHPSWHGE\(5,6$LQVWDWHFRXUWQRUGRHVLWVHHPUHDGLO\ DIWHUHVWDEOLVKLQJSHUVRQDOMXULVGLFWLRQXQGHU(5,6$+HQFH HQIRUFHDEOHE\LQMXQFWLYHRUGHFODUDWRU\UHOLHI$VWKHGLVWULFW GHVSLWHSRVVLEOHSURFHGXUDOIHQFLQJLQWKLVFDVHWKH%ULOOKDUW FRXUW QRWHG PDQ\ RWKHU SDUWV RI WKH (5,6$ VWDWXWH OHQG DEVWHQWLRQVROXWLRQXVHGLQRWKHUZLVHDQDORJRXV'HFODUDWRU\ WKHPVHOYHVWRUHDG\HQIRUFHPHQWE\LQMXQFWLRQRUGHFODUDWRU\ DFWLRQ >0@DQ\ mSURYLVLRQV RI WKLV VXEFKDSWHUl >LQFOXGLQJ DQG @ OHQG WKHPVHOYHV WR %4 SURFHHG WKLV DFWLRQ UHTXHVWLQJ LQMXQFWLYH DQG GHFODUDWRU\ UHOLHI mHQIRUFHPHQWl LQ DQ DFWLRQ EURXJKW XQGHU 86& DJDLQVW D VWDWH FRXUW SURFHHGLQJ ZRXOG KDYH WR IDOO XQGHU H[FHSWLRQV WR D EHFDXVH WKH\ SODFH VSHFLILF GXWLHV RQ ERWK WKH $QWL,QMXQFWLRQ $FW DQG <RXQJHU 6HH 0LWFKXP Y )RVWHU
VSHFLILFSHUVRQV6HFWLRQ D E\FRQWUDVWGRHVQRW 86 6HH JHQHUDOO\ (5:,1 & +(0(5,16.< ('(5$/ ) s85,6',&7,21 DQG G HG +RZHYHU WKLV DFWLRQ DSSHDUV WR PHHW H[FHSWLRQV WR QHLWKHU ,Q SDUWLFXODU ZH GR QRW UHDG 0RUHRYHU VWDWH FRXUWV FOHDUO\ KDYH FRQFXUUHQW MXULVGLFWLRQ (5,6$jV DXWKRUL]DWLRQ RI LQMXQFWLYH UHOLHI DV H[SUHVVO\ DXWKRUL]LQJ RYHU(5,6$FDVHVWKDWDUHQRWFRPSOHWHO\SUHHPSWHG6HH LQMXQFWLRQV RI VWDWH FRXUW SURFHHGLQJV 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
sXGJPHQW$FWFDVHVLVQRWDYDLODEOHWRXV6HH%ULOOKDUWY SURFHGXUDO IHQFLQJ DQG FLUFXPYHQWLQJ D SODLQWLIIjV FKRVHQ ([FHVV,QV&RRI$P86 IRUXP +RZHYHU WR WKH H[WHQW WKDW WKH *XOI /LIH FRXUW LQWHUSUHWV &RQJUHVVj SXUSRVH WR PHDQ WKDW ILGXFLDULHV PD\ ,, QHYHULQYRNH H EHFDXVHLWLVWKHUHIRUXVHRQO\E\ EHQHILFLDULHVDQGSDUWLFLSDQWVZHUHVSHFWIXOO\GLVDJUHH7KH 3HUVRQDO MXULVGLFWLRQ XQGHU H GHSHQGV XSRQ WHUPVRIWKHVWDWXWHGRQRWUHTXLUHWKDWOLPLWHGDUHDGLQJDQG VXEMHFWPDWWHUMXULVGLFWLRQXQGHU D ,I H ZH QHHG QRW DEVROXWHO\ EDU ILGXFLDULHV IURP LQYRNLQJ DSSOLHVWRWKLVFDVHWKHQWKHGLVWULFWFRXUWDUJXDEO\KDGSURSHU H LQRUGHUWRVD\WKDWWKHVXLWKHUHGRHVQRWHQIRUFH MXULVGLFWLRQ RYHU sHIIHUVRQ EHFDXVH KLV PLQLPXP FRQWDFWV (5,6$6HFWLRQ H DOORZVVXLWWREHEURXJKWmLQWKH ZLWK WKH 8QLWHG 6WDWHV PLJKW VXIILFH WR HVWDEOLVK SHUVRQDO GLVWULFW ZKHUH WKH SODQ LV DGPLQLVWHUHGl m RU ZKHUH D MXULVGLFWLRQ,ILWGRHVQRWDSSO\WKHQWKHGLVWULFWFRXUWGLG GHIHQGDQWUHVLGHVlZKLFKVXJJHVWVWKDWDOOVXLWVQHHGQRWEH EURXJKWLQWKHGHIHQGDQWEHQHILFLDU\SDUWLFLSDQWjVIRUXP 86& H HPSKDVLVDGGHG 7KHVWDWXWHGRHVQRW OLPLWQDWLRQZLGHVHUYLFHRISURFHVVRQO\WRVXLWVEURXJKWE\ &RQWUDU\ WR 1*6j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jVDUJXPHQWWKDWLQMXQFWLYH )G Q WK &LU m3ODLQWLIIV FRQWHQG WKDW ZH DQG GHFODUDWRU\ UHOLHI DUH JHQHUDOO\ DYDLODEOH XQGHU WKDW DGRSWHG WKH QDWLRQDO FRQWDFWV WHVW LQ >.QRZOHV@ .QRZOHV PHUHO\ VHFWLRQ $V 1*6 SRLQWV RXW D mKDV EHHQ VWDQGV IRU WKH QDUURZ SURSRVLWLRQ WKDW XQGHU WKH IDFWV DQG FLUFXPVWDQFHV LQWHUSUHWHG DV FUHDWLQJ D FDXVH RI DFWLRQ IRU D GHFODUDWRU\ SUHVHQWHG LQ WKDW FDVH > 86&@ Y D DXWKRUL]HG WKH GLVWULFW FRXUW MXGJPHQWl7KLRNRO )GDWFLWLQJ)UDQFKLVH7D[ WR H[HUFLVH DQG HQIRUFH LWV VXESRHQD SRZHU ZRUOGZLGHl 0RUHRYHU WKH (LJKWK &LUFXLW KDV LPSOLHG WKDW (5,6$jV QDWLRQZLGH VHUYLFH RI SURFHVV %RDUGRI&DOLIY&RQVWUXFWLRQ/DERUHUV9DFDWLRQ7UXVWIRU SURYLVLRQ ZRXOG QRW HVWDEOLVK SHUVRQDO MXULVGLFWLRQ LQ FLUFXPVWDQFHV 6&DOLI86Q VHHDOVR(,&(ONLQV VLPLODU WR WKLV FDVH 6HH 'RH ,, )G DW m3UXGHQWLDO ZDV MXVWLILHG )6XSS HQWHUWDLQLQJDQDFWLRQIRULQMXQFWLYHDQG LQ VHHNLQJ GHFODUDWRU\ UHOLHI LQ WKH RQO\ IRUXP LQ ZKLFK sDQH 'RH ZDV GHFODUDWRU\ UHOLHI WR GHWHUPLQH ZKHWKHU (5,6$ SUHHPSWV D VXEMHFW WR SHUVRQDO MXULVGLFWLRQl HPSKDVLV DGGHG VHH DOVR 3DQDPD Y VWDWHODZ )LUHVWRQH)G HQWHUWDLQLQJDQDFWLRQIRU %&&, +ROGLQJV )G WK &LU KROGLQJ LQ WKH LQMXQFWLYHDQGGHFODUDWRU\UHOLHIWRGHWHUPLQHZKHWKHU(5,6$ FRQWH[W RI 5,&2jV QDWLRQZLGH VHUYLFH RI SURFHVV SURYLVLRQ WKDW m>D@ GHIHQGDQWjV µPLQLPXP FRQWDFWVj ZLWK WKH 8QLWHG 6WDWHV GR QRW SUHHPSWVDQ$NURQFLW\WD[RIJHQHUDODSSOLFDWLRQ %XWMXVW DXWRPDWLFDOO\ VDWLVI\ WKH GXH SURFHVV UHTXLUHPHQWV RI WKH )LIWK EHFDXVH D GHFODUDWRU\ DFWLRQ PD\ EH SHUPLVVLEOH LQ VRPH $PHQGPHQWl FLUFXPVWDQFHV XQGHU D WR HQIRUFH (5,6$ 7KDW VDLG WKH ZHLJKW RI 6L[WK &LUFXLW SUHFHGHQW VXSSRUWV DFFHSWDQFH SUHHPSWLRQGRHVQRWPHDQWKDW1*6jVGHFODUDWRU\DFWLRQLV RI WKH QDWLRQDO FRQWDFWV DSSURDFK 6HH +DLOH Y +HQGHUVRQ 1DWjO %DQN RQHWRHQIRUFH(5,6$SUHHPSWLRQ )G WK &LU DGRSWLQJ WKH QDWLRQDO FRQWDFWV DSSURDFK IRU WKH QDWLRQZLGH VHUYLFH RI SURFHVV SURYLVLRQ LQ WKH IHGHUDO UHFHLYHUVKLS VWDWXWH 86& DQG 8QLWHG /LEHUW\ /LIH ,QV &R Y 5\DQ $QDORJL]LQJWR7KLRNRO1*6VWDWHVWKDWLWVLQMXQFWLYHDQG )G WK &LU FLWLQJ +DLOH WR DFFHSW QDWLRQDO GHFODUDWRU\ DFWLRQV DUH DSSURSULDWH XQGHU D mWR FRQWDFWV XQGHU WKH QDWLRQZLGH VHUYLFH RI SURFHVV SURYLVLRQ LQ WKH 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
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jVJRDORIHQKDQFLQJWKHDFFRXQWDELOLW\RIEHQHILWSODQV HQMRLQDQ\DFWRUSUDFWLFHZKLFKYLRODWHVDQ\SURYLVLRQRI WR EHQHILFLDULHV 7KH (OHYHQWK &LUFXLW UHDG WKH OHJLVODWLYH WKLVVXEFKDSWHURUWKHWHUPVRIWKHSODQRU % WRREWDLQ KLVWRU\WRSURVFULEHVXFKDFRXQWHULQWXLWLYHLQWHUSUHWDWLRQRI RWKHU DSSURSULDWH HTXLWDEOH UHOLHI L WR UHGUHVV VXFK WKHVWDWXWH m:HUHZHWRDGRSW*XOI/LIHjVYLHZWKHVZRUG YLRODWLRQ RU LL WR HQIRUFH DQ\ SURYLVLRQV RI WKLV WKDW&RQJUHVVLQWHQGHGSDUWLFLSDQWVEHQHILFLDULHVWRZLHOGLQ VXEFKDSWHURUWKHWHUPVRIWKHSODQ>@ DVVHUWLQJ WKHLU ULJKWV FRXOG LQVWHDG EH WXUQHG DJDLQVW WKRVH ZKRPLWZDVGHVLJQHGWRDLGl,GDW6LPLODUO\WKH 86& D 1*6DUJXHVWKDWDVWUDLJKWIRUZDUG 1LQWK &LUFXLW KDV QRWHG WKDW m>L@I D GLVWULFW FRXUW JHQHUDOO\ UHDGLQJRI D $ DQG D % LL DXWKRUL]HV ZHUHFRPSHOOHGWRKHDUDQ(5,6$LQVXUHUjVGHFODUDWRU\VXLW LWV DFWLRQ WR HQMRLQ D VXLW WKDW YLRODWHV WKH VXEFKDSWHUjV WKH LQVXUHU ZRXOG EH DEOH WR FLUFXPYHQW WKH EHQHILFLDU\jV SUHHPSWLRQSURYLVLRQ DQGWRHQIRUFHWKDWSURYLVLRQ FKRLFH RI D VWDWH IRUXP LQ HYHU\ RUGLQDU\ FDVH RQ WKH /LNHZLVHLWFRQWHQGVWKDW D % LL DXWKRUL]HVLWV LQVXUDQFHFRQWUDFWl7UDQVDPHULFD2FFLGHQWDO/LIH)G DW6RZKLOHDILGXFLDU\PD\EULQJDFWLRQVDJDLQVWLWV RZQSODQjVEHQHILFLDULHVIRUYLRODWLQJSODQWHUPVsHIIHUVRQLV 6HFXULWLHV ([FKDQJH $FW RI *LYHQ WKLV OLQH RI SUHFHGHQW ZH OLNHO\ ULJKWWKDW1*6jVDFWLRQLVRQOHVVVROLGIRRWLQJ ZRXOG KDYH WR ILQG SHUVRQDO MXULVGLFWLRQ LQ WKLV FDVH LI 1*6jV DFWLRQ WUXO\ ZHUH EURXJKW XQGHU (5,6$ 6HH %HOODLUH *HQ +RVS Y %OXH &URVV DQG
6WLOO *XOI /LIH DQG :LQVWHDG GR GHILQH WKH VFRSH RI %OXH 6KLHOG RI 0LFK )G WK &LU LQWHUSUHWLQJ D SUHFHGHQW DNLQ WR 8QLWHG /LEHUW\ DV ELQGLQJ WKH FRXUW WR KROG WKDW H GLIIHUHQWO\ *XOI /LIH KROGV WKDW D ILGXFLDU\ (5,6$jV QDWLRQZLGH VHUYLFH RI SURFHVV SURYLVLRQ DOVR VDWLVILHV GXH FDQQRW EULQJ DQ DFWLRQ WR GHWHUPLQH ZKDW LW RZHV D SURFHVV EXW QRWLQJ D mIDLO>XUH@ WR DSSUHKHQG KRZ SHUVRQDO MXULVGLFWLRQ FDQ EHQHILFLDU\ EHFDXVH GRLQJ VR GRHV QRW HQIRUFH DQ (5,6$ EH VHSDUDWHG IURP GXH SURFHVV E\ &RQJUHVVLRQDO HQDFWPHQW RI QDWLRQZLGH SURYLVLRQRUWKHWHUPVRIWKHSODQ$VWKDWFRXUWSRLQWVRXW VHUYLFH RI SURFHVV SURYLVLRQVl %HFDXVH ZH XOWLPDWHO\ FRQFOXGH WKDW
ILGXFLDULHV DUH QRW PHQWLRQHG LQ D % ZKLFK 1*6j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jV VXJJHVWLRQ LQ GLFWD LW ZRXOG QRW HQIRUFH (5,6$jV ZKHUHDV (5,6$ LV QRW $00 6L[ &OLQLFV +ROGLQJ &RUS ,, Y &DIFRPS 6\V SXUSRVH WR DOORZ VXFK GHFODUDWRU\ DFWLRQV DJDLQVW ,QF )G UHVHUYLQJ WKH TXHVWLRQ ZKHWKHU (5,6$ EHQHILFLDULHV HVSHFLDOO\ LQVRIDU DV LW RSHQV WKH GRRU WR H[SUHVVO\ DXWKRUL]HV LQMXQFWLRQV DJDLQVW VWDWH FRXUW SURFHHGLQJV DQG GHFLGLQJ WKH FDVH RQ RWKHU JURXQGV 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
GHFODUDWRU\DFWLRQDVDSSURSULDWHHTXLWDEOHUHOLHIWRHQIRUFH VXLW LQ WKLV FLUFXLW E\ LQFOXGLQJ D QDWLRQZLGH VHUYLFH RI WKHSUHHPSWLRQSURYLVLRQRIWKHVXEFKDSWHU$VVXPLQJ1*6 SURFHVV SURYLVLRQ LQ (5,6$ :H GLVDJUHH 7R WKH H[WHQW LV D ILGXFLDU\ WKH TXHVWLRQ QDUURZV WR ZKHWKHU VHHNLQJ OHJLVODWLYH KLVWRU\ LV UHOLDEOH LW GRHV QRW FRQWUDGLFW RXU LQMXQFWLYH DQG GHFODUDWRU\ UHOLHI DJDLQVW D VWDWH FRXUW WRUW UHDGLQJRIWKHVWDWXWRU\WH[W DFWLRQ HQIRUFHV (5,6$jV SUHHPSWLRQ SURYLVLRQ 'HVSLWH 1*6jVVWUHQXRXVDUJXPHQWVWRWKHFRQWUDU\ZHFRQFOXGHLW sHIIHUVRQ DUJXHV WKDW D GRHV QRW SHUPLW VXLWV E\ GRHVQRW LQVXUDQFHFRPSDQLHVRUILGXFLDULHVDJDLQVWLQGLYLGXDOVDQG WKDWVXFKDUHDGLQJmSHUYHUWVWKHLQWHQWLRQVDQGGLFWDWHVRI 1*6GRHVQRWSRLQWWKLVFRXUWWRDQ\FDVHVZKHUHDVXLWKDV &RQJUHVV DQG IOLHV LQ WKH IDFH RI WKH VWDWX>W@H LWVHOIl EHHQ DOORZHG E\ DQ (5,6$ ILGXFLDU\ DJDLQVW D SODQ sHIIHUVRQjV EULHI DW $V sHIIHUVRQ FKDUDFWHUL]HV WKH EHQHILFLDU\WRHQIRUFH(5,6$j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sHIIHUVRQjV $VVXPLQJ WKHVH VWHSV DUH VDWLVILHG 1*6 DUJXHV WKDW DUJXPHQWZKLFKWKRXJKPLOGDQGQRWGLVSRVLWLYHLVIRXQGLQ H HVWDEOLVKHV SHUVRQDO MXULVGLFWLRQ RYHU D ERWK+RXVHDQG6HQDWHUHSRUWV EHQHILFLDU\VXHGXQGHU D 3UREOHPVH[LVWZLWKDW OHDVWWKHILUVWWKUHHOLQHVRI1*6j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j LQWHQW WKDW WKH QDWLRQZLGH VHUYLFH RI SURFHVV &RQQ DOORZLQJVXLWE\DILGXFLDU\DJDLQVWWKHHVWDWHRI SURYLVLRQRQO\UXQRQHZD\ DQLQGLYLGXDOZKRPDGHPLVUHSUHVHQWDWLRQVLQKHUDSSOLFDWLRQ WRMRLQWKHSODQ VHHDOVR3URYLGHQW/LIH $FFLGHQW,QV&R :H EHOLHYH WKDW (5,6$jV OHJLVODWLYH KLVWRU\ Y:DOOHU )G QQ WK&LU DOORZLQJ XQTXHVWLRQDEO\ GHPRQVWUDWHV WKDW &RQJUHVV GLG QRW DQHTXLWDEOHVXLWIRUXQMXVWHQULFKPHQWE\DILGXFLDU\DJDLQVW LQWHQG WR DOORZ D ILGXFLDU\ WR IRUFH D SODQ SDUWLFLSDQWEHQHILFLDU\ZKRZRUNHGIRUDFRPSDQ\IRU 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
GRHV QRW IRU H[DPSOH ULVN ORVLQJ WKH DELOLW\ WR FRQWHVW DEHQHILFLDU\ZKRUHIXVHGWRUHLPEXUVHWKHSODQIRUEHQHILWV FRYHUDJHLILWZDLWVWREHVXHG6HH*XDUGLDQ/LIH) DGYDQFHGWRKHUZKHQVKHUHFHLYHGDMXGJPHQWDJDLQVWDWKLUG 6XSS DW 1RU GRHV LW QHHG WR LQWHUGLFW WKH RQJRLQJ SDUW\LQH[FHVVRIWKHEHQHILWVDGYDQFHGWRKHUXQGHUWKHSODQ HQIRUFHPHQWRIDVWDWHODZDJDLQVWLWVHOI6HH7KLRNRO&RUS EXW QRWLQJ WKH SRVVLELOLW\ RI DQG GHDUWK RI DXWKRULW\ Y'HSWRI7UHDV )G WK&LU )LUHVWRQH VXSSRUWLQJ D VXLW XQGHU D 7KHVH FDVHV DOO 7LUH 5XEEHU&RY1HXVVHU)G WK&LU LQYROYHGEHQHILFLDULHVVXHGE\ILGXFLDULHVIRUYLRODWLQJWHUPV (,&(ONLQV&RQVWUXFWRUV,QFY&KLOHV)6XSS RIWKHLUUHVSHFWLYHSODQVQRWSURYLVLRQVRI(5,6$$OWKRXJK 1')OD LWPDNHVSHUIHFWVHQVHWKDWILGXFLDULHVZRXOGEHDEOHWRVXH SODQEHQHILFLDULHVWRUHFRXSORVVHVIURPSODQYLRODWLRQVHYHQ 2SSRVLQJ *XOI /LIH 1*6 LQVWHDG GHIHQGV WKH 6HYHQWK LQ GLVWDQW IRUD WKHVH FDVHV KDUGO\ LQGLFDWH WKDW (5,6$ &LUFXLWjVVXSSRVHGUHDGLQJWKDWm>Z@HGRQRVHPDQWLFYLROHQFH DXWKRUL]HV ILGXFLDULHV WR VXH EHQHILFLDULHV IRU YLRODWLQJ WRVHFWLRQ D ZKHQZHLQWHUSUHWLWWRDOORZDQ(5,6$ SURYLVLRQVRI(5,6$7KHIDFWWKDWWKLVVXEFKDSWHURI(5,6$ SODQWREULQJDGHFODUDWRU\MXGJPHQWDFWLRQWRGHWHUPLQHWKH VSHFLILHVSHQDOWLHVDYDLODEOHDJDLQVWILGXFLDULHVZKRYLRODWH H[WHQWRILWVOLDELOLW\DQGZHSURPRWHWKHJRDOVRI(5,6$E\ WKHVWDWXWHEXWQRWDJDLQVWEHQHILFLDULHVIXUWKHUVXJJHVWVWKDW WKDWLQWHUSUHWDWLRQl:LQVWHDGYs&3HQQH\&R )G WKH VWDWXWH GRHV QRW FRQWHPSODWH DQ\ VXLWV DJDLQVW WK&LU %XW:LQVWHDGDOORZVDGHFODUDWRU\ EHQHILFLDULHVWRHQIRUFHSURYLVLRQVRI(5,6$OHWDORQHVXLWV MXGJPHQWDFWLRQE\DQ(5,6$SODQDJDLQVWDQRWKHUSODQWR EURXJKWE\ILGXFLDULHV GHWHUPLQH WKH H[WHQW RI LWV OLDELOLW\ LQ D FRRUGLQDWLRQRI EHQHILWVSULPDF\RIREOLJDWLRQ FRQWH[W ,W GRHV QRW 7ZRSUHYLRXVFDVHVLQZKLFKILGXFLDULHVKDYHDWWHPSWHGWR FRXQWHQDQFHDQDFWLRQE\DILGXFLDU\DJDLQVWDEHQHILFLDU\ HQIRUFH(5,6$SUHHPSWLRQDJDLQVWEHQHILFLDULHVDUHVLPLODU DQG SHUVRQDO MXULVGLFWLRQ ZDV QRW DW LVVXH LQ WKDW FDVH HQRXJKWR1*6jVDFWLRQWRPHULWFORVHFRPSDULVRQ7KRXJK )XUWKHUPRUHWKH6HYHQWK&LUFXLWKDVVXEVHTXHQWO\UHFRJQL]HG QRWGLVFXVVHGE\WKHSDUWLHV3UXGHQWLDO,QV&RRI$PHULFD WKHOLPLWHGQDWXUHRILWVKROGLQJLQ:LQVWHDG m2XURSLQLRQLQ Y 'RH PRVW FORVHO\ UHVHPEOHV WKH FDVH EHIRUH WKH FRXUW :LQVWHDGKROGVWKDW D PD\EHXVHGWRFRRUGLQDWH EHFDXVH WKH ILGXFLDU\ WKHUH VRXJKW D GHFODUDWRU\ MXGJPHQW UHODWHG SODQVj FRQIOLFWLQJ RU RYHUODSSLQJ SURYLVLRQVl XQGHU D WKDWZRXOGKDYHKDGWKHHIIHFWRIHQMRLQLQJ 0DVVH\)HUJXVRQ 'LY RI 9DULW\ &RUS Y *XUOH\ )G D VWDWH FRXUW WRUW DFWLRQ +RZHYHU LQ WKDW FDVH SHUVRQDO WK&LU MXULVGLFWLRQZDVQRWLQGLVSXWHDQGWKHSODQKDGILOHGVXLWILUVW 8QGHU WKRVH FLUFXPVWDQFHV WKH DSSHDOV FRXUW KHOG WKDW D )LQDOO\ 1*6 FRQWHQGV WKDW DQ LQMXQFWLRQ LV DSSURSULDWH GLVWULFW FRXUW QHHG QRW DEVWDLQ IURP KHDULQJ D GHFODUDWRU\ UHOLHIGHVSLWHDQ\MXGLFLDOTXDOPVZLWK1*6jVEULQJLQJVXLW DFWLRQ HVSHFLDOO\ JLYHQ WKH EURDG GLVFUHWLRQ LQYHVWHG LQ DJDLQVWDSODQEHQHILFLDU\LQDIRUXPIDUUHPRYHGIURPWKH GLVWULFWFRXUWVXQGHUWKH'HFODUDWRU\sXGJPHQW$FW EHQHILFLDU\jVSODFHRIUHVLGHQFH%\1*6jVOLJKWV&RQJUHVV KDVDOUHDG\SDVVHGMXGJPHQWRQWKHSURSULHW\RI1*6jVILOLQJ ,Q RQH FDVH LW FLWHV LQ WKLV YHLQ 1*6 PLVFKDUDFWHUL]HV WKH 6L[WK &LUFXLWj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jV EHQHILFLDULHV DW WR GHFLGH WKH SHUVRQDO MXULVGLFWLRQ TXHVWLRQ DOO 1*6$PHULFDQ,QFYsHIIHUVRQHWDO 1R 1R 1*6$PHULFDQ,QFYsHIIHUVRQHWDO
>$@IHGHUDOFRXUWQHHGQRWDEVWDLQIURPSURFHHGLQJZLWK DFWLRQIRUGHFODUDWRU\UHOLHIZRXOGKDYHDULVHQ DVLWKDV DVD DGHFODUDWRU\MXGJPHQWDFWLRQmZKHUHWKHIHGHUDOVXLWLV FRPSDQLRQFODLPWRDQLQMXQFWLRQDFWLRQLQWKHDEVHQFHRIWKH ILOHG VXEVWDQWLDOO\ SULRU WR DQ\ VWDWH VXLWV VLJQLILFDQW 'HFODUDWRU\sXGJPHQW$FWDQGWKXVLVDSSURSULDWH,QRWKHU SURFHHGLQJVKDYHWDNHQSODFHLQWKHIHGHUDOVXLWDQGWKH ZRUGV 1*6 DUJXHV WKDW LWV GHFODUDWRU\ DFWLRQ QHHG QRW EH IHGHUDO VXLW KDV QHLWKHU WKH SXUSRVH QRU WKH HIIHFW RI HTXLWDEOH VLQFH WKH LQMXQFWLYH DFWLRQ DOUHDG\ HVWDEOLVKHV RYHUWXUQLQJDSUHYLRXVVWDWHFRXUWUXOLQJl SHUVRQDO MXULVGLFWLRQ EXW WKDW LWV GHFODUDWRU\ DFWLRQ LV HTXLWDEOH QRQHWKHOHVV %XW D GHFODUDWRU\ DFWLRQ LV QRW 'RH ,, )G DW TXRWLQJ 5R\DO ,QV &R RI $P Y HTXLWDEOH ZKHUH LW VXEVWLWXWHV IRU D GHIHQVH WR FODLPV RQ D 4XLQQ/ &DSLWDO &RUS )G WK &LU FRQWUDFWLQDQXQGHUO\LQJVXLW%HVLGHV ZKLFKWKHUHDVRQV 1RQHWKHOHVV LQYLWHG WR DSSO\ WKH %ULOOKDUW IDFWRUV LQ DUWLFXODWHGIRUWKHLQYDOLGLW\RI1*6jVLQMXQFWLRQVXLWPDNHLWV FRQVLGHULQJDEVWHQWLRQRQUHPDQGWKHGLVWULFWFRXUWGLGVRDQG GHFODUDWRU\DFWLRQnZKHWKHULQGHSHQGHQWRUQRWnLQYDOLGDV DEVWDLQHG6HH3UXGHQWLDO,QV&RRI$PY'RH)6XSS ZHOO7RWKHH[WHQWHTXLWDEOHUHOLHILVVRXJKWWRSUHYHQWVXLW G ('0R m'RH,,,l FLWLQJ%ULOOKDUW LQ )ORULGD VWDWH FRXUW WKDW LV QRW D NLQG RI HTXLWDEOH UHOLHI 86DW PDGHDYDLODEOHXQGHU(5,6$ 7KHSDUWLHVGLVFXVVLQJUHDWGHWDLOWKHRWKHUVLPLODUFDVH 1*6IXUWKHUFRQWHQGVWKDWGHFODUDWRU\DQGLQMXQFWLYHUHOLHI ZKRVH KROGLQJ LV FRQWUDU\ WR 'RH 7KH (OHYHQWK &LUFXLWjV LVQHFHVVDU\WRHQIRUFH(5,6$SUHHPSWLRQEHFDXVHXQOLNHWKH RSLQLRQ LQ *XOI /LIH ,QVXUDQFH &R Y $UQROG KROGV WKDW D SODLQWLIIILGXFLDU\LQ*XOI/LIHZKRFRXOGHQIRUFHWKHSODQE\ ILGXFLDU\jV GHFODUDWRU\ MXGJPHQW DFWLRQ WR GHWHUPLQH WKH VLPSO\ UHIXVLQJ WR SD\ EHQHILWV QRW RZHG LW LV QRW ZLWKLQ H[WHQWRILWVOLDELOLW\LVQRWDQDFWLRQWKDWHQIRUFHV(5,6$RU 1*6jVRZQSRZHUWRSUHYHQWsHIIHUVRQjV)ORULGDODZVXLW%XW WKH WHUPV RI DQ\ SODQ DV SHU D VR SHUVRQDO 1*6KDVQRULJKWWRSUHYHQWWKHLQLWLDWLRQRIWKHVXLWLQVWDWH MXULVGLFWLRQ FDQQRW EH REWDLQHG IRU VXFK DQ DFWLRQ YLD FRXUW QRWHYHQFRPSOHWHSUHHPSWLRQHQWDLOVDULJKWQRWWREH H 6HH*XOI/LIH,QV&RY$UQROG )G VXHG LQ VWDWH FRXUW 7KH 6XSUHPH &RXUWjV FRPSOHWH WK&LU 1*6VHHNVWRGLVWLQJXLVKLWVRZQ SUHHPSWLRQMXULVSUXGHQFHGRHVQRWVXJJHVWVXFKDULJKWDQG DFWLRQIURPWKDWLQ*XOI/LIHLQDQXPEHURIZD\V1*6QRWHV 1*6SURYLGHVQRWDVKUHGRIVXSSRUWIRUVXFKLPPXQLW\IURP WKDWLWUHTXHVWVDQLQMXQFWLRQDVZHOODVGHFODUDWRU\UHOLHIVR VXLW 5DWKHU WKH GRFWULQH RI FRPSOHWH SUHHPSWLRQ PDNHV WKDW*XOI/LIHj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sXGJPHQW $FW LQ WKLV FDVH DV GLVFXVVHG DERYH %XW FI )HGHUDO )RXQWDLQ m>$@ GHIHQVH SUHPLVHG RQ SUHHPSWLRQ FUHDWHV IHGHUDO ,QF Y .5 (QWHUWDLQPHQW ,QF ,Q UH )HGHUDO )RXQWDLQ ,QF )G TXHVWLRQ MXULVGLFWLRQ EXW RQH EDVHG RQ SUHHPSWLRQ GRHV QRWl WK &LU HQ EDQF DGRSWLQJ WKH QDWLRQDO FRQWDFWV WHVW $OH[DQGHU Y (OHFWURQLF 'DWD 6\V &RUS )G WK &LU LQ WKH EDQNUXSWF\ FRQWH[W %HFDXVH LW GRHV QRW HQIRUFH (5,6$ WR SUHYHQW WKH ILOLQJ RI HYHQ
Reference
- Status
- Published