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

52< &22/(< 0' 0 : ; (/1$&+()0'  3ODLQWLIIV$SSHOODQWV   1R  Y !   s(11,)(5 *5$1+2/0  $WWRUQH\*HQHUDORIWKH6WDWH  RI0LFKLJDQ '28*/$6  0$&. 0'&KDLUSHUVRQ   0,&+,*$1 %2$5' 2)  0(',&,1(  'HIHQGDQWV$SSHOOHHV   1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH(DVWHUQ'LVWULFWRI0LFKLJDQDW'HWURLW 1R n1DQF\*(GPXQGV'LVWULFWsXGJH $UJXHG 0D\ 'HFLGHGDQG)LOHG 0D\  %HIRUH 0(55,7768+5+(,15,&+DQG*,/0$1 &LUFXLWsXGJHV

  &RROH\HWDOY*UDQKROPHWDO 1R 1R &RROH\HWDOY*UDQKROPHWDO 

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sXGJH  ,Q WKLV SK\VLFLDQDVVLVWHG VXLFLGH RU HXWKDQDVLD FDVH TXHVWLRQV RI MXVWLFLDELOLW\ DQG TXHVWLRQV RI WKH FRQVWLWXWLRQDOLW\ RI 0LFKLJDQ HXWKDQDVLD OHJLVODWLRQDUHUDLVHG7KH'LVWULFW&RXUWKHOGWKDW0LFKLJDQjV UHFHQWO\HQDFWHGDQWLHXWKDQDVLDVWDWXWHGRHVQRWYLRODWHWKH VXEVWDQWLYHGXHSURFHVVFODXVHRIWKH)RXUWHHQWK$PHQGPHQW 7KH FDVH UDLVHV FDVHRUFRQWURYHUV\ TXHVWLRQV RI PRRWQHVV DQGULSHQHVVIRUDGMXGLFDWLRQDQGRQWKHPHULWVDQLVVXHRI ZKHWKHU DQG XQGHU ZKDW FLUFXPVWDQFHV D SK\VLFLDQ PD\ DGPLQLVWHUOHWKDOPHGLFDWLRQVWRWHUPLQDOO\LOOSDWLHQWVZKR DUHVXEMHFWWRmXQEHDUDEOHDQGLUUHPHGLDEOHVXIIHULQJl 7KHUH DUH VHYHUDO W\SHV RI HXWKDQDVLD LQFOXGLQJ   WKH UHIXVDO RI PHGLFDO WUHDWPHQW WKDW ZRXOG SURORQJ OLIH E\ D FRPSHWHQW WHUPLQDOO\ LOO SDWLHQW D ULJKW SURWHFWHG E\ VXEVWDQWLYH GXH SURFHVV UHFRJQL]HG LQ &UX]DQ Y 'LUHFWRU 0LVVRXUL'HSDUWPHQWRI+HDOWK 86    KROGLQJ WKDW QR VXFK FRQVWLWXWLRQDO ULJKW H[LVWV IRU DQ LQFRPSHWHQW UDWKHUWKDQDFRPSHWHQWSDWLHQW   VRFDOOHGmGRXEOHHIIHFWl HXWKDQDVLD ZKHUH D WHUPLQDOO\ LOO SDWLHQW LQ VHYHUH SDLQ LV JLYHQSDLQPHGLFDWLRQZKLFKUHOLHYHVSDLQEXWDOVRFXWVVKRUW WKHSDWLHQWjVOLIH DQG  mSK\VLFLDQDVVLVWHGVXLFLGHlZKLFK NLOOVWKHSDWLHQWWKURXJKPHDQVRWKHUWKDQWKHZLWKGUDZDORI  &RROH\HWDOY*UDQKROPHWDO 1R 1R &RROH\HWDOY*UDQKROPHWDO 

SHUPLVVLEOHXQGHU0LFKLJDQODZnZLWKGUDZDORIOLIHVXSSRUW OLIH VXSSRUW RU mGRXEOH HIIHFWl HXWKDQDVLD  0LFKLJDQ ODZ DQGmGRXEOHHIIHFWlHXWKDQDVLDnDUHXQZRUNDEOHIRUVXFK DOORZVWKHILUVWWZRIRUPVRIHXWKDQDVLDEXWRXWODZVWKHWKLUG SDWLHQWVDQGGRQRWDOORZWKHSK\VLFLDQVXIILFLHQWOHHZD\WR FDUU\RXWWKHSDWLHQWj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mZKHWKHU GHOD\HG UHYLHZ ZRXOG FDXVH KDUGVKLSl DQG mZKHWKHU WKH & +HOSVWKHLQGLYLGXDOSODQRUDWWHPSWWRNLOOKLPVHOI FRXUWVZRXOGEHQHILWIURPIXUWKHUIDFWXDOGHYHORSPHQWRIWKH RUKHUVHOIRUNLOOVKLPVHOIRUKHUVHOI LVVXHVl7KHFDVHZDVSUHPDWXUHEHFDXVHWKHSODLQWLIImZLOO KDYHDQDPSOHRSSRUWXQLW\ODWHUWREULQJLWVOHJDOFKDOOHQJHDW 0LFK&RPS/DZV$QQ† D HIIHFWLYH6HSWHPEHU D WLPH ZKHQ KDUP LV PRUH LPPLQHQW DQG PRUH FHUWDLQl   /LNHZLVHKHUHZLWKRXWWKHIRFXVWKDWDSDUWLFXODU SDWLHQWjV VLWXDWLRQSURYLGHVZHFDQQRWEHVXUHZKHWKHUWKHMXVWLILFDWLRQ 7KHSODLQWLIIVDUJXHWKDWZHVKRXOGLQYDOLGDWHWKLVVWDWXWHDV RIHXWKDQDVLDEDVHGRQZLWKGUDZLQJOLIHVXSSRUWDQGmGRXEOH LWDSSOLHVWRGRFWRUVZKRKHOSSDWLHQWVNLOOWKHPVHOYHVLIWKH HIIHFWlPHGLFDWLRQLVSUHVHQWDQGZRXOGSURYLGHDOHJDOEDVLV SDWLHQWLV  PHQWDOO\FRPSHWHQW  WHUPLQDOO\LOODQG  IRUHXWKDQDVLDXQGHUWKH0LFKLJDQODZ1HLWKHUFDQZHEH mVXIIHULQJXQEHDUDEOHDQGLUUHPHGLDEOHSDLQl VXUHZKHWKHURXWVLGHSUHVVXUHVKDYHEHHQEURXJKWWREHDURU 7KH'LVWULFW&RXUWFRQFOXGHGDQGWKHSDUWLHVGRQRWDSSHDU VRPHRWKHUDEXVHLVSUHVHQW$VWKH&RXUWVDLGLQ7H[DVY WR FRQWHVW WKH IDFW WKDW 0LFKLJDQ ODZ SHUPLWV VRFDOOHG 8QLWHG6WDWHV86    LQZKLFKLWFRQFOXGHGWKDW mGRXEOHHIIHFWlHXWKDQDVLD7KH'LVWULFW&RXUWPDGHWKHSRLQW D9RWLQJ5LJKWV$FWFODLPZDVQRWULSH mDFODLPLVQRWULSH DVIROORZV IRUDGMXGLFDWLRQLILWUHVWVXSRQµFRQWLQJHQWIXWXUHHYHQWVWKDW PD\QRWRFFXUDVDQWLFLSDWHGRULQGHHGPD\QRWRFFXUDWDOOjl 0LFKLJDQ ODZ GRHV QRW SURKLELW GRFWRUV IURP 4XRWLQJ 7KRPDV Y 8QLRQ &DUELGH  86   SUHVFULELQJPHGLFDWLRQZKLFKKDVWKHmGRXEOHHIIHFWlRI    UHOLHYLQJSDLQZKLOHDOVRKDVWHQLQJGHDWKRUVXEVWDQWLDOO\ LQFUHDVLQJ WKH ULVN RI GHDWK  7KH 0LFKLJDQ 'LJQLILHG 'HDWK$FW0LFK&RPS/DZV$QQ†† H[SUHVVO\SURYLGHVWKDWDSK\VLFLDQLVLPPXQHIURPFLYLO  &RROH\HWDOY*UDQKROPHWDO 1R 1R &RROH\HWDOY*UDQKROPHWDO 

RUDGPLQLVWUDWLYHOLDELOLW\IRUSUHVFULELQJDQDUFRWLFGUXJ &RXQVHOIRUWKHWZRGRFWRUVQRZDGYLVHXVWKDW'U&RROH\ LQ JRRG IDLWK DQG ZLWK WKH LQWHQWLRQ WR DOOHYLDWH D KDVUHWLUHGDQGFRQFHGHWKDWWKHFDVHLVPRRWDVWRKLP7KH\ SDWLHQWjV SDLQ  0LFK &RPS /DZV $QQ †  SRLQWRXWWKDW'U(O1DFKHIKDVPRYHGWR&DOLIRUQLDEXWZLOO 7KH$FWVHWVIRUWKWKHLQWHQWRIWKH/HJLVODWXUHDVIROORZV UHWXUQWR0LFKLJDQWRSUDFWLFHVRPHWLPHLQWKHIXWXUHLIKHFDQ ILQGDVXLWDEOHMRE&RXQVHOGRHVQRWFRQFHGHPRRWQHVVLQ >7@KHOHJLVODWXUHUHFRJQL]HVWKDWDZHOOFRQVLGHUHG 'U(O1DFKHIjVFDVH ERG\ RI FRPPRQ ODZ H[LVWV GHWDLOLQJ WKH UHODWLRQVKLSEHWZHHQKHDOWKFDUHSURYLGHUVDQGWKHLU ,QOLJKWRIWKLVVLWXDWLRQWKHFDVHLVERWKPRRWDQGQRWULSH SDWLHQWV7KLVDFW LVQRWLQWHQGHGWRDEURJDWHDQ\ IRU FRQVLGHUDWLRQ EHFDXVH QHLWKHU GRFWRU KDV DQ LPPHGLDWH SDUW RI WKDW ODZ  7KLV DFW LV LQWHQGHG WR LQFUHDVH FRQFUHWHLQWHUHVWLQWKHRXWFRPHRIWKHFDVHRUDSDWLHQWZKR WHUPLQDOO\LOOSDWLHQWVjDZDUHQHVVRIWKHLUULJKWWR LVVXIIHULQJmXQEHDUDEOHDQGLUUHPHGLDEOHSDLQl:LWKUHVSHFW PDNHGHFLVLRQVWRUHFHLYHFRQWLQXHGLVFRQWLQXHRU WRPRRWQHVVWKHFXUUHQWVLWXDWLRQVLQZKLFKWKHGRFWRUVILQG UHIXVHPHGLFDOWUHDWPHQW,WLVKRSHGWKDWE\GRLQJ WKHPVHOYHV n QHLWKHU SUDFWLFHV PHGLFLQH LQ 0LFKLJDQ DQ\ VR WKH OHJLVODWXUH ZLOO HQFRXUDJH EHWWHU ORQJHU n PHDQV WKDW WKH FDVH KDV FRPSOHWHO\ ORVW mLWV FRPPXQLFDWLRQEHWZHHQWHUPLQDOO\LOOSDWLHQWVDQG FKDUDFWHUDVDSUHVHQWOLYHFRQWURYHUV\RIWKHNLQGWKDWPXVW KHDOWKFDUHSURYLGHUVWRHQVXUHWKDWDWHUPLQDOO\LOO H[LVWLI>WKH&RXUWLV@WRDYRLGDGYLVRU\RSLQLRQVRQDEVWUDFW SDWLHQWjVILQDOGD\VDUHPHDQLQJIXODQGGLJQLILHG SURSRVLWLRQVRIODZl+DOOY%HDOV 86    7KH\KDYHQRmOHJDOO\FRJQL]DEOHLQWHUHVWLQWKHRXWFRPHl ,G †  HPSKDVLV DGGHG   7KXV WKH $FW 3RZHOOY0F&RUPDFN 86     H[SUHVVO\SURWHFWVWKHULJKWWRUHFHLYHPHGLFDOWUHDWPHQW LQFOXGLQJ WKH ULJKW WR SDLQ UHOLHI PHGLFDWLRQ  )XUWKHU ,QDGGLWLRQHYHQLIWKHFDVHZHUHQRWPRRWEHFDXVHRIWKH SDOOLDWLYH FDUH ZKLFK PD\ KDYH WKH IRUHVHHQ EXW VWDWXV RI WKH GRFWRUV LW LV GRXEWIXO WKDW LW FRXOG SDVV WKH XQLQWHQGHGHIIHFWRIKDVWHQLQJDSDWLHQWjVGHDWKGRHVQRW ULSHQHVV WHVW  7KH UHFRUG GRHV QRW FOHDUO\ GHVFULEH DQ\ FRQVWLWXWHFULPLQDODVVLVWDQFHWRVXLFLGH7KH0LFKLJDQ FRPSHWHQWWHUPLQDOO\LOOSDWLHQWmVXIIHULQJLUUHPHGLDEOHSDLQl VWDWXWHFULPLQDOL]LQJDVVLVWHGVXLFLGHDSSOLHVRQO\ZKHQ ZKRVHHXWKDQDVLDUHTXHVWFRXOGQRWEHPHWE\ZLWKGUDZDORI WKHUHLVDQLQWHQWWRNLOOQRWZKHQWKHUHLVDQLQWHQWWR OLIHVXSSRUWRUSDLQPHGLFDWLRQRUVRPHFRPELQDWLRQRIWKH UHOLHYHSDLQ0LFK&RPS/DZV$QQ† D WZR7KHFDVHLVSUHVHQWO\K\SRWKHWLFDODQGDVWKH6XSUHPH &RXUWREVHUYHGLQ&UX]DQDERXWHXWKDQDVLDmLWLVWKHEHWWHU 'LVWULFW&RXUWRSLQSS SDUWRIZLVGRPQRWWRDWWHPSWE\DQ\JHQHUDOVWDWHPHQWWR FRYHUHYHU\SRVVLEOHSKDVHRIWKHVXEMHFWl 86 ,Q WKH SUHVHQW FDVH WKH WZR GRFWRUV KDYH QRW FOHDUO\ LGHQWLILHG DQ\ FXUUHQW SDWLHQW RU DQ\ IXWXUH SDWLHQW ZKR LV 7KH WZR GRFWRUV FRQWHQG WKDW WKHUH DUH XQXVXDO SDWLHQWV WHUPLQDOO\LOODQGmVXIIHULQJLUUHPHGLDEOHSDLQlDQGZKRVH ZLWK/RX*HKULJjVGLVHDVHDQGFHUWDLQFDQFHUVZKRDUH  GHDWKPD\QRWEHKDVWHQHGOHJDOO\E\ZLWKGUDZLQJDUWLILFLDO PHQWDOO\ FRPSHWHQW   WHUPLQDOO\ LOO DQG   HQGXULQJ OLIH VXSSRUW RU E\ DGPLQLVWHULQJ PRUSKLQH RU RWKHU SDLQ mXQEHDUDEOHVXIIHULQJZLWKLUUHPHGLDEOHSDLQl7KH\DUJXH PHGLFDWLRQ  ,W LV XQFOHDU IURP WKH UHFRUG KRZ RU LQ ZKDW WKDWWKRVHSDWLHQWVVKRXOGEHHQWLWOHGWRFKRRVHHXWKDQDVLDDV FDVHV 0LFKLJDQ ODZ ZRXOG GLVWLQJXLVK EHWZHHQ  DFRQVWLWXWLRQDOULJKWXQGHU VXEVWDQWLYHGXHSURFHVV7KH\ ZLWKGUDZDO RI OLIH VXSSRUW DQG mGRXEOH HIIHFWl HXWKDQDVLD DUJXHWKDWWKHUHFHQW0LFKLJDQODZFULPLQDOL]LQJSK\VLFLDQ WKURXJKSDLQPHGLFDWLRQIRUSDWLHQWVVXIIHULQJmLUUHPHGLDEOH DVVLVWHGVXLFLGHLVXQFRQVWLWXWLRQDODVDSSOLHGWRVXFKSDWLHQWV SDLQlnZKLFKDUHSHUPLWWHGnDQG  HXWKDQDVLDIRUVXFK 7KH\ IXUWKHU DUJXH WKDW WKH WZR IRUPV RI HXWKDQDVLD SDWLHQWVWKURXJKLOOHJDOSK\VLFLDQDVVLVWHGVXLFLGH