Carten v. Kent State Univ
Carten v. Kent State Univ
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
75(925 &$57(1 ; 3ODLQWLII$SSHOOHH 1R Y ! .(17 67$7( 81,9(56,7<HW DO 'HIHQGDQWV$SSHOODQWV 1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH1RUWKHUQ'LVWULFWRI2KLRDW$NURQ 1R n'DYLG''RZGsU'LVWULFWsXGJH 6XEPLWWHG 'HFHPEHU 'HFLGHGDQG)LOHG )HEUXDU\ %HIRUH 6,/(5DQG%$7&+(/'(5&LUFXLWsXGJHV +22''LVWULFWsXGJH
7KH +RQRUDEOH sRVHSK 0 +RRG 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU WKH (DVWHUQ 'LVWULFW RI .HQWXFN\ VLWWLQJ E\ GHVLJQDWLRQ
&DUWHQY.HQW6WDWH8QLYHWDO 1R 1R &DUWHQY.HQW6WDWH8QLYHWDO
BBBBBBBBBBBBBBBBB UHOLHIWRHQGDFRQWLQXLQJYLRODWLRQRIIHGHUDOODZ6HH([ SDUWH<RXQJ 86 )LQDOO\DVWDWHPD\ZDLYH &2816(/ (OHYHQWK $PHQGPHQW SURWHFWLRQ 6HH /DZVRQ Y 6KHOE\ &RXQW\)G WK&LU 21%5,() 6WHSKHQs3UXQHVNL5REHUW)/LQWRQ6WHYHQ /3DXOVRQ52'(5,&.0<(56 /,1721$NURQ2KLR ,Q1LKLVHUY2KLR(3$ )G WK&LU WKLV IRU$SSHOODQWV5REHUW7UROO/\QFK&OHYHODQG+HLJKWV2KLR &RXUWFRQFOXGHGWKDW2KLRXQDPELJXRXVO\ZDLYHG(OHYHQWK IRU$SSHOOHH $PHQGPHQW LPPXQLW\ DJDLQVW 5HKDELOLWDWLRQ $FW FODLPV ZKHQLWDJUHHGWRDFFHSWIHGHUDOIXQGVSXUVXDQWWRWKDW$FW BBBBBBBBBBBBBBBBB ,G DW FI /DQH Y 3HQD 86 ILQGLQJVWDWHZDLYHU sLP&Y8QLWHG6WDWHV)G 23,1,21 WK&LU HQEDQF VDPH 6WDQOH\Y/LWVFKHU)G BBBBBBBBBBBBBBBBB WK &LU VDPH &ODUN Y &DOLIRUQLD )G WK&LU VDPH ,QOLJKWRIWKLV&RXUWjVGHFLVLRQ s26(3+0+22''LVWULFWsXGJH'HIHQGDQWV$SSHOODQWV LQ 1LKLVHU ZH ILQG WKDW &DUWHQjV 5HKDELOLWDWLRQ $FW FODLP .HQW 6WDWH 8QLYHUVLW\ m.68l DQG GRFWRUV *DU\ 1HLPDQ DJDLQVW.68DQGWKH'RFWRUVLQWKHLURIILFLDOFDSDFLWLHVLVQRW 5RVHPDU\ 'XPRQW :LOOLDP &DQ\RQ DQG 'DQQ\ :DOODFH EDUUHG DSSHDO WKH GLVWULFW FRXUWjV SDUWLDO GHQLDO RI WKHLU PRWLRQ WR GLVPLVV 'HIHQGDQWV DUJXH WKDW WKH GLVWULFW FRXUW HUUHG E\ &21&/86,21 KROGLQJWKDWWKH(OHYHQWK$PHQGPHQWGLGQRWEDUWKHFODLPV RI3ODLQWLII$SSHOOHH7UHYRU&DUWHQ m&DUWHQl XQGHU7LWOH,, )RUWKHUHDVRQVVWDWHGDERYHZH5(9(56(WKHGLVWULFW RIWKH$PHULFDQVZLWK'LVDELOLWLHV$FW m$'$l 86& FRXUWDVWR3ODLQWLIIjV$'$7LWOH,,FODLPIRUPRQH\GDPDJHV DQGRIWKH5HKDELOLWDWLRQ$FWRI DJDLQVW .68 DQG WKH LQGLYLGXDO GHIHQGDQWV DV ZHOO DV KLV m5HKDELOLWDWLRQ$FWl %DVHGRQQHZODZIURPWKH6XSUHPH $'$ 7LWOH ,, FODLP IRU HTXLWDEOH UHOLHI DJDLQVW .68 DQG &RXUWDQGWKLVFLUFXLWZH5(9(56(WKHGLVWULFWFRXUWDVWR $)),50WKHGLVWULFWFRXUWjVGHFLVLRQDVWR3ODLQWLIIjVRWKHU 3ODLQWLIIjV$'$7LWOH,,FODLPVIRUPRQH\GDPDJHVDJDLQVW FODLPV7KLVPDWWHULV5(0$1'('WRWKHGLVWULFWFRXUWIRU .68DQGWKHLQGLYLGXDOGHIHQGDQWVDVZHOODVKLV$'$7LWOH SURFHHGLQJVFRQVLVWHQWZLWKWKLVRSLQLRQ ,,FODLPIRUHTXLWDEOHUHOLHIDJDLQVW.68:H$)),50WKH GLVWULFWFRXUWLQDOORWKHUUHVSHFWV )$&76 .68DFFHSWHG&DUWHQDVDJUDGXDWHVWXGHQWLQLWV6FKRRORI /LEUDU\ DQG ,QIRUPDWLRQ 6HUYLFHV RQ sXO\ 2Q $XJXVW .68GLVPLVVHG&DUWHQIRUSRRUDFDGHPLF SHUIRUPDQFH .68 DIILUPHG &DUWHQjV GLVPLVVDO LQ D 6HSWHPEHU KHDULQJ2Q2FWREHU &DUWHQ ILOHGVXLWLQGLVWULFWFRXUWDJDLQVWWKHXQLYHUVLW\DQGGRFWRUV 1HLPDQ 'XPRQW &DQ\RQ DQG :DOODFH mWKH 'RFWRUVl DOOHJLQJ YLRODWLRQV RI $'$ 7LWOH ,, RI WKH 5HKDELOLWDWLRQ$FWDQG&KDSWHURIWKH2KLR5HYLVHG&RGH &DUWHQY.HQW6WDWH8QLYHWDO 1R 1R &DUWHQY.HQW6WDWH8QLYHWDO
WKHPVHOYHVRIIHUDSRZHUIXOUHDVRQWRSURYLGHDIHGHUDO 6SHFLILFDOO\ &DUWHQ DOOHJHG WKDW 'HIHQGDQWV UHIXVHG WR IRUXP DFFRPPRGDWHKLVOHDUQLQJGLVDELOLW\DQGGLVPLVVHGKLPEDVHG RQ WKDW GLVDELOLW\ &DUWHQ VRXJKW UHOLHI LQ WKH IRUP RI &RHXU Gj$OHQH 86 DW /LNHZLVH WKH 6XSUHPH LQFRPSHQVDWRU\GDPDJHVLQSXQLWLYH &RXUWMXVWLILHGLWVKROGLQJLQ*DUUHWWLQSDUWE\QRWLQJWKDW GDPDJHVFRVWVDQGDWWRUQH\jVIHHVDQGUHLQVWDWHPHQW IHGHUDO([SDUWH<RXQJDFWLRQVSURYLGHGRWKHUDYHQXHVIRU HQIRUFHPHQWRIDQWLGLVFULPLQDWLRQJXDUDQWHHVVXJJHVWLQJWKDW 'HIHQGDQWVWKHQPRYHGWRGLVPLVVDOOFODLPVDJDLQVWWKHP WKH&RXUWEHOLHYHVWKHUHWREHDQRQJRLQJIHGHUDOLQWHUHVWLQ 'HIHQGDQWV DUJXHG LQWHU DOLD WKDW (OHYHQWK $PHQGPHQW DOORZLQJ IHGHUDO FRXUWV WR LQWHUSUHW DQG YLQGLFDWH DQWL VRYHUHLJQLPPXQLW\EDUUHG&DUWHQjV$'$DQG5HKDELOLWDWLRQ GLVFULPLQDWLRQ JXDUDQWHHV RQH WKDW RXWZHLJKV VWDWH $FW FODLPV DJDLQVW .68 DQG WKH 'RFWRUV LQ WKHLU RIILFLDO VRYHUHLJQW\LQWHUHVWVLQDYRLGLQJVXFKVXLWV*DUUHWW86 FDSDFLWLHVDQGWKDW&DUWHQjV$'$FODLPVDJDLQVWWKH'RFWRUV DWQ 0RUHJHQHUDOO\WKH&RHXUGj$OHQH&RXUWVWDWHG LQWKHLUSHUVRQDOFDSDFLWLHVPHULWHGGLVPLVVDOEHFDXVHWKHUHLV WKDW mZKHUH SURVSHFWLYH UHOLHI LV VRXJKW DJDLQVW LQGLYLGXDO QRLQGLYLGXDOOLDELOLW\XQGHU7LWOH,,RIWKDW$FW7KHGLVWULFW VWDWHRIILFHUVLQDIHGHUDOIRUXPEDVHGRQDIHGHUDOULJKWWKH FRXUWGLVPLVVHG&DUWHQjVFODLPVDJDLQVWWKH'RFWRUVLQWKHLU (OHYHQWK$PHQGPHQWLQPRVWFDVHVLVQRWDEDUl86 SHUVRQDOFDSDFLWLHVEXWKHOGWKDWWKH(OHYHQWK$PHQGPHQW DW7KDWVLWXDWLRQDSSOLHVKHUH GLGQRWVKLHOG.68RUWKH'RFWRUVLQWKHLURIILFLDOFDSDFLWLHV IURP OLDELOLW\ XQGHU WKH $'$ RU WKH 5HKDELOLWDWLRQ $FW $'$FODLPVIRULQMXQFWLYHUHOLHIDJDLQVW.68 'HIHQGDQWVWKHQDSSHDOHGWRWKLV&RXUW 7KH (OHYHQWK $PHQGPHQW RQ LWV IDFH DSSOLHV HTXDOO\ WR 7KLV&RXUWRUGHUHGDSSHOODWHSURFHHGLQJVKHOGLQDEH\DQFH VXLWV LQ ODZ DQG HTXLW\ 7KH 6XSUHPH &RXUW VWDWHG LQ SHQGLQJLWVUHVROXWLRQRI1LKLVHUY2KLR(3$ )G 6HPLQROH7ULEHY)ORULGDWKDWmWKHUHOLHIVRXJKWE\DSODLQWLII WK&LU ZKLFKSXWVTXDUHO\EHIRUHWKH&RXUWWKHLVVXH VXLQJD6WDWHLVLUUHOHYDQWWRWKHTXHVWLRQRIZKHWKHUWKHVXLW RIZKHWKHUWKH(OHYHQWK$PHQGPHQWEDUV5HKDELOLWDWLRQ$FW LV EDUUHG E\ WKH (OHYHQWK $PHQGPHQW >DQG@ ZKHWKHU FODLPVDJDLQVWWKHVWDWHV7KLV&RXUWXOWLPDWHO\KHOGWKDW2KLR &RQJUHVVKDVSRZHUWRDEURJDWH6WDWHV LPPXQLW\l86 KDV ZDLYHG (OHYHQWK $PHQGPHQW LPPXQLW\ DJDLQVW 6HHDOVR5RODQGVY3RLQW0RXLOOH6KRRWLQJ 5HKDELOLWDWLRQ$FWFODLPV:KLOH1LKLVHUZDVSHQGLQJWKH &OXE :/ DW WK &LU sXO\ 6XSUHPH&RXUWGHFLGHG%GRI7UVY*DUUHWW86 XQSXEOLVKHG ILQGLQJWKDW(OHYHQWK$PHQGPHQWLPPXQLW\ ZKLFK KHOG WKDW WKH (OHYHQWK $PHQGPHQW EDUUHG DSSOLHGHTXDOO\WRFODLPVIRUPRQHWDU\DQGHTXLWDEOHUHOLHI PRQH\ FODLPV DJDLQVW WKH VWDWHV XQGHU $'$ 7LWOH , 7KH EURXJKWGLUHFWO\DJDLQVWWKHVWDWH $FFRUGLQJO\IRUWKHVDPH &RXUWVSHFLILFDOO\GHFOLQHGWRDGGUHVVZKHWKHUWKH(OHYHQWK UHDVRQVWKDWDSSO\WR&DUWHQjV$'$FODLPIRUPRQHWDU\UHOLHI $PHQGPHQWEDUUHGVXLWVDJDLQVWWKHVWDWHVXQGHU$'$7LWOH DJDLQVW .68 ZH ILQG WKDW WKH (OHYHQWK $PHQGPHQW EDUV ,,)LYHPRQWKVEHIRUH*DUUHWWDWKUHHMXGJHSDQHORIWKLV &DUWHQjVFODLPIRULQMXQFWLYHUHOLHIDJDLQVW.68 &RXUWFRQFOXGHGLQ3RSRYLFKY&X\DKRJD&RXQW\&RXUWRI &RPPRQ3OHDVEDVHGRQUHDVRQLQJVLPLODUWR*DUUHWWjVWKDW 5HKDELOLWDWLRQ$FWFODLP WKH(OHYHQWK$PHQGPHQWEDUVVXLWVDJDLQVWWKHVWDWHVXQGHU $'$7LWOH,,6HH)G WK&LU m3RSRYLFK 7KHUH DUH WKUHH H[FHSWLRQV WR (OHYHQWK $PHQGPHQW LPPXQLW\)LUVW&RQJUHVVPD\DEURJDWHLPPXQLW\E\VWDWXWH ZKHUHLWVDFWLRQLVDSURSHUH[HUFLVHRIFRQVWLWXWLRQDOSRZHU DVGLVFXVVHGLQ*DUUHWW6HFRQGWKH$PHQGPHQWGRHVQRWEDU 7KH GLVWULFW FRXUW DOVR GLVPLVVHG &DUWHQjV FODLPV IRU SXQLWLYH DVXLWDJDLQVWDVWDWHRIILFLDOVHHNLQJSURVSHFWLYHLQMXQFWLYH GDPDJHV XQGHU WKH $'$ DQG 5HKDELOLWDWLRQ $FW &DUWHQY.HQW6WDWH8QLYHWDO 1R 1R &DUWHQY.HQW6WDWH8QLYHWDO
,l UHKjJHQEDQFJUDQWHGRSLQLRQYDFDWHG WK&LU QHYHUWKHOHVVPD\EHKHOGUHVSRQVLEOHLQDQRIILFLDOFDSDFLW\ 6XEVHTXHQWO\ DQ HQ EDQF SDQHO RI WKLV FRXUW YDFDWHG IRU YLRODWLQJ 7LWOH ,, ZKLFK E\ LWV WHUPV DSSOLHV RQO\ WR 3RSRYLFK,DQGLVVXHGDQHZGHFLVLRQLQWKHFDVHRQsDQXDU\ mSXEOLFHQWLW>LHV@l6HH1HOVRQY0LOOHU)G WK 3RSRYLFKY&X\DKRJD&RXQW\&RXUWRI&RPPRQ &LU SHUPLWWLQJDVXLWDJDLQVWDVWDWHRIILFLDOXQGHU7LWOH 3OHDV)G WK&LU m3RSRYLFK,,l ,,RIWKH$'$ 67$1'$5'2)5(9,(: )LQDOO\ WKH GHIHQGDQWV DUJXH WKDW WKH 6XSUHPH &RXUWjV KROGLQJ LQ ,GDKR Y &RHXU Gj$OHQH 7ULEH 86 7KH DSSOLFDELOLW\ RI WKH (OHYHQWK $PHQGPHQW WR FODLPV SUHFOXGHV&DUWHQjVXVHRI([SDUWH<RXQJKHUH,Q DJDLQVW VWDWHV DQG VWDWH RIILFLDOV XQGHU WKH $'$ DQG WKH &RHXUGj$OHQHWKH&RXUWUHDVRQHGWKDWWKHUHOLHIDIIRUGHGE\ 5HKDELOLWDWLRQ $FW LV D TXHVWLRQ RI ODZ ZKLFK WKLV &RXUW ([SDUWH<RXQJLVPRVWLPSRUWDQWLQFDVHVZKHUH QRVWDWH UHYLHZVGHQRYR6HH7LPPHUY0LFK'HSjWRI&RPPHUFH IRUXPLVDYDLODEOHWRYLQGLFDWHWKHIHGHUDOFODLPRU WKH )G WK&LU IHGHUDO LQWHUHVW LQ LQWHUSUHWLQJ RU YLQGLFDWLQJ IHGHUDO ODZ RXWZHLJKVWKHVWDWHjVVRYHUHLJQW\LQWHUHVWVDQGWKDWIHGHUDO ',6&866,21 FRXUWV PD\ GHFOLQH WR DOORZ WKH ([ SDUWH <RXQJ ILFWLRQ LQ RWKHU FDVHV WKDW LPSOLFDWH VSHFLDO VWDWH VRYHUHLJQW\ LVVXHV $'$7LWOH,,FODLPVIRUPRQH\GDPDJHVDJDLQVW.68 HJLQDGMXGLFDWLQJVWDWHODQGGLVSXWHV &RHXUGj$OHQH DQGWKH'RFWRUVLQWKHLURIILFLDOFDSDFLWLHV 86DW 7KH SDUWLHV GR QRW GLVSXWH WKDW &DUWHQjV FODLPV XQGHU 7KHGHIHQGDQWVSRLQWRXWWKDWDVWDWHIRUXPH[LVWVE\ZKLFK 7LWOH,,RIWKH$'$IRUPRQH\GDPDJHVDJDLQVW.68DQGWKH WKHSODLQWLIIFRXOGSXUVXHKLVIHGHUDOFODLPVVLQFH2KLRKDV 'RFWRUVDFWDVFODLPVDJDLQVWWKH6WDWHLWVHOI7KH(OHYHQWK ZDLYHGVRYHUHLJQLPPXQLW\DVWRVXLWVEURXJKWLQWKH6WDWHjV $PHQGPHQWSURYLGHVWKDW &RXUW RI &ODLPV XQGHU 25& $ DQG WKH\ LQYLWHWKLV&RXUWWRILQGWKDW([SDUWH<RXQJVKRXOGQRWDSSO\ 7KH MXGLFLDO SRZHU RI WKH 8QLWHG 6WDWHV VKDOO QRW EH KHUH :H GHFOLQH WR GR VR LQDVPXFK DV ZH ILQG WKDW WKH FRQVWUXHG WR H[WHQG WR DQ\ VXLW LQ ODZ RU HTXLW\ IHGHUDO LQWHUHVWV LQ LQWHUSUHWLQJ IHGHUDO ODZ RXWZHLJK WKH FRPPHQFHG RU SURVHFXWHG DJDLQVW RQH RI WKH 8QLWHG 6WDWHjVVRYHUHLJQW\LQWHUHVWV'HIHQGDQWVGRQRWSRLQWWRD 6WDWHV E\ &LWL]HQV RI DQRWKHU 6WDWH RU E\ &LWL]HQV RU VSHFLDOVWDWHVRYHUHLJQW\LQWHUHVWVXFKDVVWDWHSURSHUW\ULJKW 6XEMHFWVRIDQ\)RUHLJQ6WDWH DGMXGLFDWLRQWKDWZRXOGMXVWLI\GHQ\LQJ([SDUWH<RXQJUHOLHI 86 &RQVW DPHQG ;, m$OWKRXJK E\ LWV WHUPV WKH KHUH0RUHRYHUWKH&RHXUGj$OHQH&RXUWH[SODLQHGWKDWWKH $PHQGPHQWDSSOLHVRQO\WRVXLWVDJDLQVWD6WDWHE\FLWL]HQVRI IHGHUDOJRYHUQPHQWjVLQWHUHVWLQWKHDYDLODELOLW\RI([SDUWH DQRWKHU6WDWH>WKH6XSUHPH&RXUWjV@FDVHVKDYHH[WHQGHGWKH <RXQJUHOLHILVSDUWLFXODUO\VWURQJZKHUHVXFKDFODLPLVEDVHG $PHQGPHQW VDSSOLFDELOLW\WRVXLWVE\FLWL]HQVDJDLQVWWKHLU RQIHGHUDOODZVWKDWHQIRUFH(TXDO3URWHFWLRQJXDUDQWHHV RZQ 6WDWHVl %G RI 7UV Y *DUUHWW 86 ,I&RQJUHVVSXUVXDQWWRLWVUHPHGLDOSRZHUVXQGHUWKH FLWDWLRQVRPLWWHG +RZHYHUm&RQJUHVVPD\DEURJDWH )RXUWHHQWK $PHQGPHQW PD\ DEURJDWH VRYHUHLJQ WKH 6WDWHVj (OHYHQWK $PHQGPHQW LPPXQLW\ ZKHQ LW ERWK LPPXQLW\HYHQLIWKHUHVXOWLQJOHJLVODWLRQJRHVEH\RQG XQHTXLYLFDOO\LQWHQGVWRGRVRDQGµDFW>V@SXUVXDQWWRDYDOLG ZKDW LV FRQVWLWXWLRQDOO\ QHFHVVDU\ LW IROORZV WKDW WKH JUDQWRIFRQVWLWXWLRQDODXWKRULW\jl,G FLWDWLRQVRPLWWHG VXEVWDQWLYH SURYLVLRQV RI WKH )RXUWHHQWK $PHQGPHQW &DUWHQY.HQW6WDWH8QLYHWDO 1R 1R &DUWHQY.HQW6WDWH8QLYHWDO
GRHV QRW FRQVWLWXWH SURVSHFWLYH UHOLHI GHVLJQHG WR HQG D $V WKH 6XSUHPH &RXUW REVHUYHG LQ *DUUHWW &RQJUHVV FRQWLQXLQJYLRODWLRQRIIHGHUDOODZ FOHDUO\ LQWHQGHG WR DEURJDWH VWDWHVj (OHYHQWK $PHQGPHQW LPPXQLW\IURPWKH$'$,G FLWLQJ86& m$ 7KHGHIHQGDQWVDOVRDUJXHWKDW&DUWHQjVFODLPVPXVWIDLO 6WDWHVKDOOQRWEHLPPXQHXQGHUWKHHOHYHQWKDPHQGPHQWWR EHFDXVH 7LWOH ,, LPSRVHV LWV UHTXLUHPHQWV RQO\ RQ mSXEOLF WKH &RQVWLWXWLRQRIWKH8QLWHG6WDWHVIURPDQDFWLRQLQ>D@ HQWLW>LHV@l 86& \HW &DUWHQ ZLVKHV WR KROG )HGHUDORU6WDWHFRXUWRIFRPSHWHQWMXULVGLFWLRQIRUDYLRODWLRQ UHVSRQVLEOHWKHLQGLYLGXDOGRFWRUVZKRDUHQRWSXEOLFHQWLWLHV RI WKLV FKDSWHUl 7KH &RXUW WKHQ ZHQW RQ WR FRQVLGHU 7KHGHIHQGDQWVDWWDFNWKHQDWXUDOUHVSRQVHWRWKLVDUJXPHQW ZKHWKHU&RQJUHVVDFWHGZLWKLQLWV&RQVWLWXWLRQDODXWKRULW\ nWKDWWKHGRFWRUVDUHSXEOLFHQWLWLHVLQVRIDUDVWKH\UHSUHVHQW GHWHUPLQLQJWKDW&RQJUHVVPD\RQO\VXEMHFWQRQFRQVHQWLQJ WKHVWDWHZKHQDFWLQJLQWKHLURIILFLDOFDSDFLW\nE\LQYRNLQJ VWDWHVWROLDELOLW\XQGHUWKH$'$LILWGRHVVRSXUVXDQWWRD ([SDUWH<RXQJjVKROGLQJWKDWZKHQDVWDWHRIILFLDODFWVLQDQ YDOLGH[HUFLVHRILWVSRZHUXQGHUFODXVHILYHRIWKH)RXUWHHQWK XQFRQVWLWXWLRQDOPDQQHUmKHLVLQWKDWFDVHVWULSSHGRIKLV $PHQGPHQW ,G DW 6HFWLRQ RI WKH )RXUWHHQWK RIILFLDO RU UHSUHVHQWDWLYH FKDUDFWHU DQG LV VXEMHFWHG LQ KLV $PHQGPHQWSURYLGHVLQUHOHYDQWSDUW SHUVRQWRWKHFRQVHTXHQFHVRIKLVLQGLYLGXDOFRQGXFWl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mKHLVLQWKDWFDVHVWULSSHGRIKLVRIILFLDO $PHQGPHQWSURYLGHVWKDWm>W@KH&RQJUHVVVKDOOKDYHSRZHU RUUHSUHVHQWDWLYHFKDUDFWHUl7KH&RXUWLQWKLVSKUDVHZDVQRW WRHQIRUFHE\DSSURSULDWHOHJLVODWLRQWKHSURYLVLRQVRIWKLV VD\LQJWKDWWKHRIILFLDOZDVVWULSSHGRIKLVRIILFLDOFDSDFLW\IRU DUWLFOHl 86 &RQVW DPHQG ;,9 7KH IRFXV RI WKH DOO SXUSRVHV EXW RQO\ IRU SXUSRVHV RI WKH (OHYHQWK LQTXLU\LVZKHWKHUWKHOHJLVODWLRQSURSRXQGHGE\&RQJUHVVWR $PHQGPHQW7KLVLVHYLGHQWLQ([SDUWH<RXQJLWVHOI WKRXJK HQIRUFHWKH)RXUWHHQWK$PHQGPHQWLVmDSSURSULDWHl WKHRIILFLDOZDVQRWmWKHVWDWHlIRUSXUSRVHVRIWKH(OHYHQWK $PHQGPHQW KH QHYHUWKHOHVV ZDV KHOG UHVSRQVLEOH LQ KLV ,Q*DUUHWWWKH6XSUHPH&RXUWGHWHUPLQHGWKDW&RQJUHVV RIILFLDO FDSDFLW\ IRU HQIRUFLQJ D VWDWH ODZ WKDW YLRODWHG WKH GLG QRW YDOLGO\ DEURJDWH VWDWHVj (OHYHQWK $PHQGPHQW )RXUWHHQWK$PHQGPHQWZKLFKE\LWVWHUPVDSSOLHVRQO\WR LPPXQLW\IURPVXLWIRUPRQH\GDPDJHVXQGHU7LWOH,RIWKH mVWDWHVl6HH)OD'HSjWRI6WDWHY7UHDVXUH6DOYRUV,QF $'$7LWOH,JHQHUDOO\SURKLELWVHPSOR\HUVLQFOXGLQJ6WDWHV 86 m7KHUHLVZHOOUHFRJQL]HGLURQ\LQ IURPGLVFULPLQDWLQJLQHPSOR\PHQWSUDFWLFHVDJDLQVWTXDOLILHG ([SDUWH<RXQJ XQFRQVWLWXWLRQDOFRQGXFWE\DVWDWHRIILFHU LQGLYLGXDOVZLWKGLVDELOLWLHV86&7KH PD\ EH µVWDWH DFWLRQj IRU SXUSRVHV RI WKH )RXUWHHQWK 6XSUHPH&RXUWLQLWLDOO\GHWHUPLQHGWKDW7LWOH,RIWKH$'$LV $PHQGPHQW\HWQRWDWWULEXWDEOHWRWKHVWDWHIRUWKHSXUSRVHV D VWDWXWH HQIRUFLQJ WKH (TXDO 3URWHFWLRQ &ODXVH RI WKH RIWKH(OHYHQWKl $QGLQUHMHFWLQJWKHGHIHQGDQWVj([SDUWH )RXUWHHQWK$PHQGPHQW*DUUHWW86DW7KH&RXUW <RXQJDUJXPHQWZHPDNHDVLPLODUGLVWLQFWLRQ DQRIILFLDO FRQFOXGHG WKDW LQDVPXFK DV WKHUH LV QRW D SDWWHUQ RI ZKR YLRODWHV 7LWOH ,, RI WKH $'$ GRHV QRW UHSUHVHQW mWKH GLVFULPLQDWLRQ E\ WKH VWDWHV ZKLFK YLRODWHV WKH )RXUWHHQWK VWDWHlIRUSXUSRVHVRIWKH(OHYHQWK$PHQGPHQW\HWKHRUVKH $PHQGPHQWDQGEHFDXVHWKHUHPHG\LPSRVHGXQGHU7LWOH, &DUWHQY.HQW6WDWH8QLYHWDO 1R 1R &DUWHQY.HQW6WDWH8QLYHWDO
RIWKH$'$LVQRWFRQJUXHQWRUSURSRUWLRQDOWRWKHWDUJHWHG FRQFOXVLRQEDVHGRQ*DUUHWWWKDWWKH(OHYHQWK$PHQGPHQW YLRODWLRQ&RQJUHVVGLGQRWKDYHWKHDXWKRULW\XQGHU6HFWLRQ EDUV HTXDO SURWHFWLRQ $'$ 7LWOH ,, FODLPV DJDLQVW VWDWH RIWKH)RXUWHHQWK$PHQGPHQWWRDEURJDWHVWDWHVj(OHYHQWK HQWLWLHV $PHQGPHQWLPPXQLW\IURPVXLWVIRUPRQH\GDPDJHVXQGHU 7LWOH,RIWKH$'$+RZHYHUWKH&RXUWVSHFLILFDOO\GHFOLQHG $'$7LWOH,,FODLPIRULQMXQFWLYHUHOLHIDJDLQVWWKH WR DGGUHVV ZKHWKHU &RQJUHVV YDOLGO\ DEURJDWHG VWDWHVj 'RFWRUVLQWKHLURIILFLDOFDSDFLW\ (OHYHQWK $PHQGPHQW LPPXQLW\ IURP VXLWV IRU PRQH\ GDPDJHVXQGHU7LWOH,,RIWKH$'$86Q 2QLWVIDFHWKH(OHYHQWK$PHQGPHQWEDUVmDQ\VXLWLQODZ RUHTXLW\FRPPHQFHGRUSURVHFXWHGDJDLQVWRQHRIWKH8QLWHG $QHQEDQFSDQHORIWKLV&RXUWUHFHQWO\DGGUHVVHGWKHLVVXH 6WDWHVl+RZHYHULQ([SDUWH<RXQJ 86 RI(OHYHQWK$PHQGPHQWLPPXQLW\XQGHU7LWOH,,RIWKH$'$ WKH 6XSUHPH &RXUW DQQRXQFHG DQ H[FHSWLRQ WR (OHYHQWK LQ3RSRYLFK,,)G7LWOH,,RIWKH$'$SURYLGHV $PHQGPHQWLPPXQLW\IRUFODLPVIRULQMXQFWLYHUHOLHIDJDLQVW WKDWm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jV FODLP IRU UHLQVWDWHPHQW mWKHSODLQWLIIjVDFWLRQLVEDUUHGE\WKH(OHYHQWK$PHQGPHQW PXVWIDLOEHFDXVHLWLVQRWSURVSHFWLYHDQGGRHVQRWDVVHUWD LQVRIDUDVWKHDFWLRQUHOLHVRQFRQJUHVVLRQDOHQIRUFHPHQWRI FRQWLQXLQJ YLRODWLRQ RI ODZ 6SHFLILFDOO\ WKH GHIHQGDQWV WKH(TXDO3URWHFWLRQ&ODXVHEXWLWLVQRWEDUUHGLQVRIDUDVLW DUJXH WKDW &DUWHQ VHHNV D UHWURVSHFWLYH UHYHUVDO RI D UHOLHV RQ FRQJUHVVLRQDO HQIRUFHPHQW RI WKH 'XH 3URFHVV FRPSOHWHGVWDWHGHFLVLRQWRH[SHOKLP+RZHYHUWKLV&RXUW &ODXVHl,GDW7KHHQEDQFSDQHOUHOLHGRQWKH6XSUHPH SUHYLRXVO\ KDV KHOG WKDW FODLPV IRU UHLQVWDWHPHQW DUH &RXUWjV UHDVRQLQJ LQ *DUUHWW DV ZHOO DV WKH UHDVRQLQJ RI SURVSHFWLYHLQQDWXUHDQGDSSURSULDWHVXEMHFWVIRU([SDUWH 3RSRYLFK,LQGHWHUPLQLQJWKDW7LWOH,,FODLPVVRXQGLQJLQ <RXQJ DFWLRQV 6HH 7XUNHU Y 2KLR 'HSj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m5HLQVWDWHPHQWLVSXUHO\SURVSHFWLYHLQMXQFWLYHUHOLHI>$@Q WKH GHIHQGDQWV GHQLHG KLP DGHTXDWH SURFHVV LQ GLVPLVVLQJ RUGHU WKDW UHLQVWDWHPHQW EH JUDQWHG LV WKH VRUW RI KLP$OWKRXJKKHFRQWHQGVWKDWWKHGHIHQGDQWVLPSURSHUO\ SURVSHFWLYH UHOLHI WKDW LV QRW EDUUHG E\ WKH (OHYHQWK EDVHG WKHLU GHFLVLRQ WR GLVPLVV KLP RQ KLV GLVDELOLW\ KH $PHQGPHQWl %\FRQWUDVWWKHFDVHWKHGHIHQGDQWVUHO\RQ DFNQRZOHGJHVWKDWKHZDVDIIRUGHGDKHDULQJRQWKHGLVPLVVDO 0LFK3HDWY(3$)G WK&LU GHDOWZLWK RQ 6HSWHPEHU DQG PDNHV QR FODLP WKDW KH ZDV WKH SODLQWLIIjV DWWHPSW WR UHWURDFWLYHO\ DOWHU WKH WHUPV RI D HQWLWOHG WR DGGLWLRQDO SURFHGXUH EH\RQG WKDW KHDULQJ SHUPLW JUDQWHG WR KLP E\ WKH VWDWH DQG LV LQDSSRVLWH KHUH $FFRUGLQJO\ WKLV &RXUW LV OHIW ZLWK WKH HQ EDQF SDQHOjV 7KXVZHUHMHFWWKHGHIHQGDQWVjDUJXPHQWWKDWUHLQVWDWHPHQW
Reference
- Status
- Published