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 D S

81,7('67$7(6&28572)$33($/6 )257+(6,;7+&,5&8,7 BBBBBBBBBBBBBBBBB

81,7(' 67$7(6 2) $0(5,&$ ; 3ODLQWLII$SSHOODQW    1R Y  !  &+$5/(6 '$/( %$,/(<  'HIHQGDQW$SSHOOHH  $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH(DVWHUQ'LVWULFWRI7HQQHVVHHDW*UHHQHYLOOH 1Rn7KRPDV*+XOO'LVWULFWsXGJH $UJXHG $XJXVW 'HFLGHGDQG)LOHG 6HSWHPEHU %HIRUH 0225(DQG*,/0$1&LUFXLWsXGJHV 526(1 'LVWULFWsXGJH BBBBBBBBBBBBBBBBB &2816(/ $5*8(' 'DQ56PLWK$66,67$1781,7('67$7(6 $77251(<sRKQVRQ&LW\7HQQHVVHHIRU$SSHOODQW0DUN ' (GPRQGV ($675,'*(  ('021'6 sRKQVRQ &LW\

7KH +RQRUDEOH *HUDOG ( 5RVHQ 8QLWHG 6WDWHV 'LVWULFW sXGJH IRU WKH (DVWHUQ 'LVWULFW RI 0LFKLJDQ VLWWLQJ E\ GHVLJQDWLRQ

  8QLWHG6WDWHVY%DLOH\ 1R 1R 8QLWHG6WDWHVY%DLOH\  7HQQHVVHH IRU $SSHOOHH  21 %5,()   'DQ 5 6PLWK ,,,&21&/86,21 $66,67$1781,7('67$7(6$77251(<sRKQVRQ&LW\ 7HQQHVVHHIRU$SSHOODQW0DUN'(GPRQGV($675,'*( )RUWKHIRUHJRLQJUHDVRQVZH5(9(56(WKHRUGHURIWKH ('021'6sRKQVRQ&LW\7HQQHVVHH5sDFNVRQ5RVH GLVWULFW FRXUW JUDQWLQJ %DLOH\jV PRWLRQ WR VXSSUHVV DQG ZH +DUURJDWH7HQQHVVHHIRU$SSHOOHH 5(0$1'IRUSURFHHGLQJVFRQVLVWHQWZLWKWKLVRSLQLRQ BBBBBBBBBBBBBBBBB 23,1,21 BBBBBBBBBBBBBBBBB .$5(1 1(/621 0225( &LUFXLW sXGJH  $SSHOODQW 8QLWHG6WDWHVDSSHDOVWKHGLVWULFWFRXUWjVJUDQWRI$SSHOOHHjV PRWLRQWRVXSSUHVV$SSHOOHH&KDUOHV'DOH%DLOH\ m%DLOH\l ZDV LQGLFWHG IRU FDUU\LQJ FHUWDLQ ILUHDUPV GXULQJ DQG LQ UHODWLRQWRDGUXJWUDIILFNLQJRIIHQVHLQYLRODWLRQRI86& †  F  % L DQGIRUSRVVHVVLQJILUHDUPVDVDFRQYLFWHG IHORQLQYLRODWLRQRI86&†  J %DLOH\ZDVDUUHVWHG IROORZLQJVHDUFKHVRIERWKKLVSHUVRQDQGKLVFDU+HPRYHG WRVXSSUHVVWKHHYLGHQFHREWDLQHGLQWKHVHDUFKHVFODLPLQJ WKDW WKH LQLWLDO VWRS RI KLV FDU DQG WKH VXEVHTXHQW VHDUFKHV YLRODWHGKLV)RXUWK$PHQGPHQWULJKWV$PDJLVWUDWHMXGJH UHFRPPHQGHGWKDW%DLOH\jVPRWLRQEHGHQLHGEXWWKHGLVWULFW FRXUW JUDQWHG WKH PRWLRQ  )RU WKH IROORZLQJ UHDVRQV ZH 5(9(56(WKHGLVWULFWFRXUWjVJUDQWRI%DLOH\jVPRWLRQWR VXSSUHVVDQGZH5(0$1'IRUSURFHHGLQJVFRQVLVWHQWZLWK WKLVRSLQLRQ ,%$&.*5281' ,Q WKH ODWH HYHQLQJ DQG HDUO\ PRUQLQJ RI 6HSWHPEHU  DQG 3ROLFH2IILFHU7RGG'DYLGVRQ m'DYLGVRQl DQG 3ROLFH&DSWDLQsHUU\*UDKDP m*UDKDPl RIWKH0RUULVWRZQ 7HQQHVVHH3ROLFH'HSDUWPHQWZHUHLQYHVWLJDWLQJFRPSODLQWV RIGUXJWUDIILFNLQJDWWKH5R\DO0RELOH+RPH7UDLOHU3DUNLQ SRVLWLYH LQGLFDWLRQ E\ D SURSHUO\WUDLQHG GRJ LV VXIILFLHQW WR HVWDEOLVK 0RUULVWRZQ$FFRUGLQJWR*UDKDPWKHSROLFHZHUHmPDNLQJ SUREDEOH FDXVH IRU WKH SUHVHQFH RI D FRQWUROOHG VXEVWDQFHl FLWDWLRQ WUDIILFVWRSVZKHUHZHjGJHWVRPHSUREDEOHFDXVHWRPDNHWKH RPLWWHG  )XUWKHUPRUH RQFH *UDKDP VDZ WKH JXQ LQ %DLOH\jV SRFNHW LW VWRSLIDWUDIILFYLRODWLRQRIYHKLFOHVOHDYLQJWKHVFHQHZKHUH LV FOHDU WKDW WKH RIILFHUV KDG SUREDEOH FDXVH WR VHDUFK %DLOH\jV SHUVRQ 6HH WKH\ ZHUH >VLF@ KDG WKH WUDLOHU XQGHU VXUYHLOODQFHl  sRLQW 8QLWHG 6WDWHV Y 7KRPDV  )G   WK &LU    FHUW GHQLHG  86  DQG  86    VHHLQJ JXQ KDQGOH XQGHU $SSHQGL[ ms$l  DW   *UDKDP 7HVW   'DYLGVRQ DQG GULYHUjV VHDW SURYLGHG SUREDEOH FDXVH IRU SROLFH RIILFHUV WR DUUHVW *UDKDPZHUHH[LWLQJWKHWUDLOHUSDUNZKHQWKH\HQFRXQWHUHG GHIHQGDQW RQ FKDUJHV RI FDUU\LQJ D FRQFHDOHG ZHDSRQ   8QLWHG6WDWHVY%DLOH\ 1R 1R 8QLWHG6WDWHVY%DLOH\  DFWLYLW\%DLOH\WHVWLILHGWKDWZKHQ'DYLGVRQDSSURDFKHGKLV %DLOH\ 'DYLGVRQWHVWLILHGWKDW%DLOH\jVFDUHQWHUHGWKHWUDLOHU FDUKHVLPSO\UHDFKHGWRJHWKLVGULYHUjVOLFHQVH%HFDXVHWKH SDUNRQWKHZURQJVLGHRIWKHURDGDQG*UDKDPZKRZDV GLVWULFWFRXUWJUDQWHG%DLOH\jVPRWLRQWRVXSSUHVVWKLVFRXUW GULYLQJWKHFDUWHVWLILHGWKDW%DLOH\jVFDUmDERXWKLWPHKHDG PXVW YLHZ WKH IDFWV LQ WKH OLJKW PRVW IDYRUDEOH WR %DLOH\ RQls$DW%DLOH\WHVWLILHGWKDWDOWKRXJKWKHSROLFHFDU 6PLWK)GDW(YHQYLHZLQJWKHIDFWVLQWKHOLJKW ZDV mKRJJLQJl PRVW RI WKH QDUURZ HQWUDQFH URDG LQWR WKH PRVWIDYRUDEOHWR%DLOH\ZHEHOLHYHWKDW%DLOH\jVmUHDFKLQJl WUDLOHUSDUNmWKHUHZDVVWLOOHQRXJKURRPIRUPHWRJRE\l LQWKHFRQWH[WRIWKHVXUURXQGLQJFLUFXPVWDQFHVFRXOGKDYH s$DW %DLOH\7HVW $IWHUWKHFDUVSDVVHGHDFKRWKHU EHHQOHJLWLPDWHO\SHUFHLYHGDVWKUHDWHQLQJ:KHQ'DYLGVRQ 'DYLGVRQVKRXWHGDW%DLOH\WRVWRSKLVFDU DQGZKHQ%DLOH\ DSSURDFKHG%DLOH\jVFDULWZDVGDUNFULPLQDO DFWLYLW\KDG GLG QRW LPPHGLDWHO\ VWRS KLV FDU 'DYLGVRQ JRW RXW RI WKH EHHQJRLQJRQLQ WKH DUHDDQG'DYLGVRQNQHZWKDW%DLOH\ SROLFH FDU DQG SXUVXHG %DLOH\jV FDU RQ IRRW  'DYLGVRQ PLJKW EH DUPHG DQG GDQJHURXV  *LYHQ WKLV WRWDOLW\ RI WHVWLILHGWKDWKHVWRSSHGWKHFDUm>E@HFDXVHLWKDGWXUQHGLQRQ FLUFXPVWDQFHV ZH FRQFOXGH WKDW 'DYLGVRQ KDG VXIILFLHQW RXU VLGH RI WKH URDG DQG , ZDVQjW VXUH LI >%DLOH\@ ZDV UHDVRQDEOH VXVSLFLRQ WR GHWDLQ %DLOH\ IROORZLQJ WKH LQLWLDO LQWR[LFDWHGRUQRWls$DW 'DYLGVRQ7HVW  VWRSRI%DLOH\jVFDU %DLOH\ HYHQWXDOO\ VWRSSHG KLV FDU DQG 'DYLGVRQ $VVXPLQJWKDWWKHEDVLVIRUD7HUU\VWRSZDVSURSHUWKHQ DSSURDFKHG WKH GULYHUjV VLGH RI WKH FDU WR WDON WR %DLOH\ ZHPXVWGHWHUPLQHmZKHWKHUWKHGHJUHHRILQWUXVLRQLQWRWKH $FFRUGLQJ WR 'DYLGVRQ m%DLOH\ NHSW UHDFKLQJ LQWR WKH VXVSHFWjVSHUVRQDOVHFXULW\ZDVUHDVRQDEO\UHODWHGLQVFRSHWR IORRUERDUGZKHUHKHZDVVHDWHGLQWKHYHKLFOHZKLFK>VLF@KH WKH VLWXDWLRQ DW KDQG ZKLFK LV MXGJHG E\ H[DPLQLQJ WKH ZDVWKHGULYHUls$DW  'DYLGVRQ7HVW 'DYLGVRQILUVW UHDVRQDEOHQHVVRIWKHRIILFLDOVjFRQGXFWJLYHQWKHLUVXVSLFLRQV DVNHG%DLOH\WRNHHSKLVKDQGVWRKLPVHOIDQGODWHU'DYLGVRQ DQGWKHVXUURXQGLQJFLUFXPVWDQFHVl*DU]D)GDW DVNHG%DLOH\WRVWHSRXWRIWKHFDUs$DW  m,DVNHGKLP TXRWDWLRQ RPLWWHG   ,Q UHVSRQVH WR %DLOH\jV mUHDFKLQJl WRVWHSRXWRIWKHYHKLFOHEHFDXVH,ZDVUHDOO\QHUYRXVDQG 'DYLGVRQRUGHUHG%DLOH\RXWRIWKHFDUDQGGHWDLQHGKLPIRU DQG , ZDV DZDUH WKDW KH \RX NQRZ ZDV NQRZQ WR FDUU\ OHVVWKDQWZRPLQXWHVXQWLOWKHDUULYDORIWKHGUXJVQLIILQJ ZHDSRQVDQGZKLFKKHGLGKHVWHSSHGRXWRIWKHYHKLFOHl  GRJ:HKDYHKHOGWKDWm>L@QDVLWXDWLRQZKHUHWKHRIILFHUV *UDKDP DQG 3ROLFH 2IILFHU 'DQ &R[ m&R[l  UHDFKHG WKH KDYHUHDVRQWREHOLHYHWKHRFFXSDQWVRIDFDUDUHDUPHGDQG VFHQH VRRQ WKHUHDIWHU DQG ZLWK 'DYLGVRQ DQG %DLOH\ WKH\ GDQJHURXVRIILFHUVFHUWDLQO\PD\RUGHURFFXSDQWVRXWRI ZDLWHGIRU3ROLFH2IILFHU&KULV:LVHFUDFNHU m:LVHFUDFNHUl DFDUl,GDW TXRWDWLRQRPLWWHG $QGDOWKRXJKDVWKH WREULQJLQDGUXJGRJ:LVHFUDFNHUDUULYHGLQOHVVWKDQWZR GLVWULFWFRXUWQRWHG'DYLGVRQGLGQRWUHVWUDLQ%DLOH\RUSDW PLQXWHVDQGSURFHHGHGWRmUXQWKHGRJRQWKHYHKLFOHls$ KLPGRZQDIWHUKHJRWRXWRIWKHFDUWKHGHWHQWLRQRIOHVVWKDQ DW:KLOHWKHGRJVQLIIHGIRUGUXJVLQWKHFDU*UDKDP WZRPLQXWHVGRHVQRWDSSHDUWREHDQXQUHDVRQDEOHLQWUXVLRQ QRWLFHGWKDW%DLOH\KDGSXWKLVKDQGLQKLVSRFNHW*UDKDP FRQVLGHULQJ%DLOH\jVSRWHQWLDOO\WKUHDWHQLQJEHKDYLRULQWKH DVNHG%DLOH\WRUHPRYHKLVKDQGDQGZKHQ%DLOH\GLGUHPRYH FDU  7KHUHIRUH ZH FRQFOXGH WKDW 'DYLGVRQ KDG VXIILFLHQW KLVKDQG*UDKDPVDZWKHEXWWRIDJXQ7KHSROLFHRIILFHUV UHDVRQDEOHVXVSLFLRQXQGHU7HUU\WRGHWDLQ%DLOH\IROORZLQJ WKHLQLWLDOWUDIILFVWRSDQGXQWLOWKHDUULYDORIWKHGUXJVQLIILQJ GRJ  *UDKDP DOVR WHVWLILHG WKDW ZKHQ 'DYLGVRQ UHFRJQL]HG %DLOH\ KH mKROOHUHG \RX NQRZ WKDWjV KLP    l s$ DW  *UDKDP 7HVW    2QFH WKH GUXJVQLIILQJ GRJ DUULYHG DQG DOHUWHG WR DUHDV LQ %DLOH\jV 'DYLGVRQ DOVR WHVWLILHG WKDW mZH KDG DQ LQIRUPDQW FDPH >VLF@ WR XV FDU LW LV FOHDU WKDW WKH SROLFH RIILFHUV KDG SUREDEOH FDXVH WR VHDUFK WKH FDU SHUVRQDOO\ WDONHG WR PH DQG 0U &R[ WROG XV WKDW KH 0U %DLOH\ KDG 6HH 8QLWHG 6WDWHV Y 'LD]  )G      WK &LU   m$ PDGH WKUHDWV RQ RXU OLIH >VLF@l s$ DW  'DYLGVRQ 7HVW   8QLWHG6WDWHVY%DLOH\ 1R 1R 8QLWHG6WDWHVY%DLOH\ RQ WKH VFHQH WKHQ KDQGFXIIHG DQG DUUHVWHG %DLOH\ :H HPSKDVL]H WKDW mFRXUWV PXVW FDUHIXOO\ VFUXWLQL]H DQ ,PPHGLDWHO\DIWHU%DLOH\ZDVDUUHVWHG&R[LQDQHIIRUWWR RIILFHUjVVWDWHGUHDVRQVIRUGHWDLQLQJ>DQ@LQGLYLGXDOEH\RQG FDOP %DLOH\ GRZQ WROG %DLOH\ WKDW mHYHU\WKLQJ ZRXOG EH WKHSXUSRVHRI>DWUDIILF@VWRSWRLQVXUHWKDWWKHUHDVRQVULVHWR RND\l  s$ DW  &R[ 7HVW   7R WKLV VWDWHPHQW %DLOH\ WKHOHYHORIUHDVRQDEOHVXVSLFLRQVRWKDWWKHRIILFHUGRHVQRW DOOHJHGO\UHVSRQGHGmQRHYHU\WKLQJZRQjWEHRND\7KHUHjV DEXVH KLV DXWKRULW\ XQGHU :KUHQl  +LOO   )G DW  WKUHHRXQFHVRIFRFDLQHLQWKHFDUls$DW7KHVHDUFKRI +RZHYHUZHFRQFOXGHWKDW%DLOH\jVEHKDYLRULPPHGLDWHO\ WKHFDUIROORZLQJWKHGUXJGRJjVDOHUWLQWZRDUHDVGLGLQIDFW IROORZLQJWKHWUDIILFVWRSLQFRQMXQFWLRQZLWKWKHVXUURXQGLQJ \LHOGWZRPRUHJXQVDQGWKUHHRXQFHVRIFRFDLQH FLUFXPVWDQFHVLQGHSHQGHQWO\JDYHULVHWRVXIILFLHQWUHDVRQDEOH VXVSLFLRQXQGHU7HUU\WRMXVWLI\%DLOH\j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mFULPLQDODFWLYLW\PD\EHDIRRWlHYHQLIKHODFNVSUREDEOH LQYLRODWLRQRI86&†  F  % L DQG  SRVVHVVLQJ FDXVH  (UZLQ  )G DW  TXRWLQJ 8QLWHG 6WDWHV Y ILUHDUPV DV D FRQYLFWHG IHORQ LQ YLRODWLRQ RI  86& 6RNRORZ 86   :HHYDOXDWHWKHOHJLWLPDF\ †  J 2Q'HFHPEHU%DLOH\PRYHGWRVXSSUHVV RI 7HUU\ VWRSV E\ HQJDJLQJ LQ D WZRSDUW DQDO\VLV RI WKH WKHHYLGHQFHREWDLQHGLQWKHVHDUFKRIWKHFDUDQGWKHVHDUFK UHDVRQDEOHQHVV RI WKH VWRS  )LUVW ZH PXVW GHWHUPLQH RIKLVSHUVRQ+HDOOHJHGWKDWWKHLQLWLDOVWRSRIKLVFDUKLV mZKHWKHU WKHUH ZDV D SURSHU EDVLV IRU WKH VWRS ZKLFK LV DUUHVW DQG WKH VHDUFKHV ZHUH DOO LQ YLRODWLRQ RI KLV )RXUWK MXGJHGE\H[DPLQLQJZKHWKHUWKHODZHQIRUFHPHQWRIILFLDOV $PHQGPHQW ULJKWV  2Q 'HFHPEHU    D PDJLVWUDWH ZHUHDZDUHRIVSHFLILFDQGDUWLFXODEOHIDFWVZKLFKJDYHULVH MXGJH KHOG D KHDULQJ RQ WKH PRWLRQ DQG RQ 'HFHPEHU  WRUHDVRQDEOHVXVSLFLRQl8QLWHG 6WDWHV Y*DU]D)G  KH LVVXHG D UHSRUW DQG UHFRPPHQGDWLRQ WR GHQ\ WKH  WK&LU   TXRWDWLRQRPLWWHG 7KH6XSUHPH PRWLRQWRVXSSUHVV2Q0DUFK KRZHYHUWKHGLVWULFW &RXUW KDV UHFHQWO\ UHLWHUDWHG WKDW FRXUWV PXVW ORRN DW WKH FRXUWJUDQWHG%DLOH\jVPRWLRQWRVXSSUHVV7KHFRXUWIRXQG mWRWDOLW\ RI WKH FLUFXPVWDQFHVl LQ PDNLQJ UHDVRQDEOH WKDWmWKHRIILFHUVjDFWLRQV>LQVWRSSLQJDQGVHDUFKLQJ%DLOH\@ VXVSLFLRQGHWHUPLQDWLRQV8QLWHG6WDWHVY$UYL]X6&W ZHUHQRWMXVWLILHGDWWKHLULQFHSWLRQDQGWKHLUDFWLRQVZHUHQRW   +RZHYHUmDQRIILFHUjVUHOLDQFHRQDPHUH UHDVRQDEO\ UHODWHG LQ VFRSH WR WKH FLUFXPVWDQFHV ZKLFK µKXQFKjLVLQVXIILFLHQWWRMXVWLI\DVWRSl,GDW TXRWLQJ MXVWLILHGWKHLQWHUIHUHQFHLQWKHILUVWSODFHls$DW 7HUU\ 86DW  0HP   7KHUHIRUH WKH FRXUW FRQFOXGHG WKDW mWKH VHDUFK LQFLGHQW WR >WKH LQLWLDO@ VWRS ZDV LQ YLRODWLRQ RI WKH 'DYLGVRQ WHVWLILHG WKDW %DLOH\ mNHSW UHDFKLQJ LQWR WKH GHIHQGDQWjV )RXUWK $PHQGPHQW ULJKWVl  s$ DW   7KH IORRUERDUGl ZKHQ 'DYLGVRQ DSSURDFKHG %DLOH\jV FDU JRYHUQPHQWWLPHO\DSSHDOV LPPHGLDWHO\IROORZLQJWKHLQLWLDOVWRSs$DW  'DYLGVRQ 7HVW 7KLVEHKDYLRURQWKHSDUWRI%DLOH\PDGH'DYLGVRQ mUHDOO\ QHUYRXVl EHFDXVH 'DYLGVRQ NQHZ WKDW %DLOH\ ZDV mNQRZQWRFDUU\ZHDSRQVlDQGWKDW%DLOH\KDGPDGHWKUHDWV RQ'DYLGVRQjVOLIHs$DW ,QDGGLWLRQWKHLQLWLDOVWRS RI%DLOH\jVFDUWRRNSODFHDWRQHRjFORFNLQWKHPRUQLQJDWWKH  5R\DO0RELOH+RPH7UDLOHU3DUNnDNQRZQDUHDRIFULPLQDO 7KH JXQ RQ %DLOH\jV SHUVRQ WXUQHG RXW WR EH XQORDGHG  8QLWHG6WDWHVY%DLOH\ 1R 1R 8QLWHG6WDWHVY%DLOH\  LQLWLDOLQWHUIHUHQFHl,G FLWLQJ8QLWHG6WDWHVY3DORPLQR ,,$1$/<6,6 )G  WK&LU   TXRWLQJ7HUU\ 86DW    m2QFH WKH SXUSRVHV RI WKH LQLWLDO WUDIILF VWRS >DUH@ $6WDQGDUGRI5HYLHZ FRPSOHWHGWKHUHLVQRGRXEWWKDWWKHRIILFHU>FDQ@QRWIXUWKHU GHWDLQ WKH YHKLFOH RU LWV RFFXSDQWV XQOHVV VRPHWKLQJ WKDW :HUHYLHZGHQRYRWKHGLVWULFWFRXUWjVOHJDOFRQFOXVLRQVLQ RFFXUUHG GXULQJ WKH WUDIILF VWRS JHQHUDWHG WKH QHFHVVDU\ D VXSSUHVVLRQ KHDULQJ DQG ZH UHYLHZ WKH GLVWULFW FRXUWjV UHDVRQDEOHVXVSLFLRQWRMXVWLI\DIXUWKHUGHWHQWLRQl8QLWHG ILQGLQJVRIIDFWIRUFOHDUHUURU8QLWHG6WDWHVY6PLWK 6WDWHVY0HVD)G  WK &LU  VHHDOVR )G WK&LU m$IDFWXDOILQGLQJLVFOHDUO\ 8QLWHG6WDWHVY(UZLQ)G WK&LU   HQ HUURQHRXVZKHQWKHUHYLHZLQJFRXUWLVOHIWZLWKWKHGHILQLWH EDQF  FHUW GHQLHG  86    mZKHQ D ODZ DQG ILUP FRQYLFWLRQ WKDW D PLVWDNH KDV EHHQ PDGHl  ,G HQIRUFHPHQWRIILFHUQRORQJHUKDVDQ\UHDVRQDEOHVXVSLFLRQRI FLWDWLRQRPLWWHG :KHUHWKHGLVWULFWFRXUWJUDQWVDPRWLRQWR FULPLQDODFWLYLW\WKHGHWDLQHGLQGLYLGXDOLVFRQVWLWXWLRQDOO\ VXSSUHVV WKLV FRXUW YLHZV WKH HYLGHQFH LQ WKH OLJKW PRVW IUHHWROHDYHl  IDYRUDEOHWRWKHGHIHQGDQW,G m>7@KH&RXUWFRQVLGHUVWKH HYLGHQFHLQWKHOLJKWPRVWOLNHO\WRVXSSRUWWKHGLVWULFWFRXUWjV ,Q WKLV FDVH WKH SXUSRVHV RI WKH WUDIILF VWRS ZHUH QHYHU GHFLVLRQl TXRWDWLRQRPLWWHG  DFFRPSOLVKHG7KHGLVWULFWFRXUWIRXQGmLWXQGLVSXWHGWKDWWKH RIILFHUV DW WKH VFHQH GLG QRW SXUVXH WKH LQLWLDO VWRS LQ DQ\ %,QLWLDO6WRSRI%DLOH\jV&DU PDQQHUl  s$ DW  0HP   7KH RIILFHUV WKHPVHOYHV WHVWLILHGWKDWWKH\ZHUHPDNLQJmWUDIILFVWRSVlMXVWWRORRNIRU 7KHGLVWULFWFRXUWFRQFOXGHGWKDWWKHLQLWLDOVWRSRI%DLOH\jV RWKHULOOHJDODFWLYLW\6HHHJs$DW  *UDKDP7HVW FDUE\'DYLGVRQDQG*UDKDPZDVQRWMXVWLILHGEHFDXVHLWZDV m:H ZHUH PDNLQJ WUDIILF VWRSV ZKHUH ZHjG JHW VRPH mDSUHWH[Wls$DW 0HP %\WKLVWKHFRXUWVHHPVWR SUREDEOHFDXVHWRPDNHWKHVWRSLIDWUDIILFYLRODWLRQl KDYHPHDQWWKDWDOWKRXJK'DYLGVRQDQG*UDKDPRVWHQVLEO\ DQGm>Z@HZHUHVWRSSLQJWKHRQHVWKDWZDV>VLF@FRPLQJEDFN VWRSSHG%DLOH\IRUDWUDIILFYLRODWLRQnGULYLQJRQWKHZURQJ LQWR WRZQ IRU WDLOOLJKW YLRODWLRQV RU DQ\ \RX NQRZ 3& VLGH RI WKH URDG ZKLOH SRVVLEO\ LQWR[LFDWHG n WKH\ UHDOO\ >SUREDEOHFDXVH@ZHFRXOGFRPHXSZLWKILQGl s$DW VWRSSHG%DLOH\IRURWKHUUHDVRQV7KHFRXUWHPSKDVL]HGWKH 0HP GHVFULSWLRQ RI :LVHFUDFNHU 7HVW  m, ZDV DVNHG WR SRUWLRQRI*UDKDPjVWHVWLPRQ\LQZKLFKKHH[SODLQHGWKDWWKH DVVLVWLQWKHQDUFRWLFVDQGYLFHGLYLVLRQWRPDNHWUDIILFVWRSV SROLFHZHUHmPDNLQJWUDIILFVWRSVlDWWKHWUDLOHUSDUNZKHUH 7KH\ZHUHZDWFKLQJRUGRLQJVXUYHLOODQFHRQDQDUHDWKDWWKH\ WKH\ KDG SUREDEOH FDXVH  7KH FRXUW DOVR FLWHG WKLV FRXUWjV KDG LQIRUPDWLRQ RQ IRU GUXJ WUDIILF  , ZDV DVNHG WR VWRS RSLQLRQLQ8QLWHG6WDWHVY+XJXHQLQ)G Q YHKLFOHVLI,IRXQGSUREDEOHFDXVHWRVWRSWKHPDVWKH\OHIW WK&LU  IRUWKHSURSRVLWLRQWKDWm>D@SUHWH[WXDOVWRS WKHDUHDl  RFFXUVZKHQWKHSROLFHXVHDOHJDOMXVWLILFDWLRQWRPDNHDVWRS LQRUGHUWRVHDUFKDSHUVRQRUKLVYHKLFOHRULQWHUURJDWH KLPIRUDQXQUHODWHGDQGPRUHVHULRXVFULPHIRUZKLFKWKH\ GRQRWKDYHWKHUHDVRQDEOHVXVSLFLRQQHFHVVDU\WRVXSSRUWD  VWRSls$DW 7KLV VWDQGDUG DSSOLHV HYHQ LI D GUXJVQLIILQJ GRJ DUULYHV ZLWKLQ D IHZ PLQXWHV RI WKH FRPSOHWLRQ RI WKH WUDIILF VWRS $00 +LOO    )G DW  DVNLQJ mZKHWKHU 'HSXW\ :KLWORFN KDG D UHDVRQDEOH VXVSLFLRQ WKDW ,W LV ZHOO HVWDEOLVKHG KRZHYHU WKDW DQ RIILFHUjV DFWXDO 'HIHQGDQWV ZHUH HQJDJHG LQ FULPLQDO DFWLYLW\ VR DV WR GHWDLQ WKHP EH\RQG PRWLYDWLRQ IRU PDNLQJ D WUDIILF VWRS LV LUUHOHYDQW WR WKH WKH SXUSRVH RI WKH WUDIILF VWRS n LH VR DV WR DOORZ 'HSXW\ :KLWORFN WR FRQVWLWXWLRQDOLW\RIWKDWVWRS6HH:KUHQY8QLWHG6WDWHV GHWDLQ 'HIHQGDQWV IRU WKH DSSUR[LPDWHO\ RQH RU WZR PLQXWHV LW WRRN 86    mWKHVHFDVHVIRUHFORVHDQ\DUJXPHQW 6SDQN\ >WKH GUXJVQLIILQJ GRJ@ WR UXQ WKH VHDUFK RI WKH YHKLFOHl HPSKDVLV DGGHG  WKDWWKHFRQVWLWXWLRQDOUHDVRQDEOHQHVVRIWUDIILFVWRSVGHSHQGV  8QLWHG6WDWHVY%DLOH\ 1R 1R 8QLWHG6WDWHVY%DLOH\  RQ WKH DFWXDO PRWLYDWLRQV RI WKH LQGLYLGXDO RIILFHUV YLRODWLRQZDVFUHGLEOHDQGWKHGLVWULFWFRXUWGLGQRWUHMHFWWKLV LQYROYHGl 8QLWHG6WDWHVY+LOO )G WK&LU ILQGLQJs$DW 5HSRUWDQG5HFRPPHQGDWLRQ  m$WWKLV  FHUWGHQLHG86   FLWLQJ:KUHQDQG MXQFWXUHWKHLVVXHLVSXUHO\RQHRIFUHGLELOLW\ ZKRLVWREH H[SODLQLQJWKDWSXUVXDQWWRWKDWGHFLVLRQmDQRIILFHUPD\VWRS EHOLHYHGn2IILFHUV*UDKDPDQG'DYLGVRQRUWKHGHIHQGDQW" DYHKLFOHIRUDWUDIILFYLRODWLRQZKHQKLVWUXHPRWLYDWLRQLVWR 7R SXW LW VXFFLQFWO\ WKH RIILFHUV DUH EHOLHYHG DQG WKH VHDUFK IRU FRQWUDEDQG DV ORQJ DV WKH RIILFHU KDG SUREDEOH GHIHQGDQW LV QRWl   7KLV FRXUW KDV KHOG WKDW m>Z@H DUH FDXVHWRLQLWLDOO\VWRSWKHYHKLFOHl VHHDOVR8QLWHG6WDWHVY JHQHUDOO\ UHOXFWDQW WR VHW DVLGH FUHGLELOLW\ GHWHUPLQDWLRQV )HUJXVRQ)G  WK&LU   HQEDQF FHUW PDGHE\WKHWULHURIIDFWZKRKDVKDGWKHRSSRUWXQLW\WRYLHZ GHQLHG86   7KHUHIRUHLWLVLUUHOHYDQWLQWKLV WKHZLWQHVVRQWKHVWDQGDQGDVVHVVKLVGHPHDQRUl3HYHOHU FDVHZKHWKHU'DYLGVRQjVDQG*UDKDPjVLQLWLDOVWRSRI%DLOH\ Y8QLWHG6WDWHV )G  WK&LU  ZDVmSUHWH[WXDOl7KHUHOHYDQWTXHVWLRQRQWKLVDSSHDOLV ZKHWKHU'DYLGVRQDQG*UDKDPKDGSUREDEOHFDXVHWRVWRS &'HWHQWLRQRI%DLOH\$IWHUWKH,QLWLDO6WRS %DLOH\IRUDWUDIILFYLRODWLRQ +DYLQJFRQFOXGHGWKDW'DYLGVRQDQG*UDKDPKDGSUREDEOH :HFRQFOXGHWKDW'DYLGVRQDQG*UDKDPGLGKDYHSUREDEOH FDXVHLQLWLDOO\WRVWRS%DLOH\IRUDWUDIILFYLRODWLRQZHPXVW FDXVH WR VWRS %DLOH\ IRU D WUDIILF YLRODWLRQ  $OWKRXJK WKH WKHQ DVN ZKHWKHU WKH RIILFHUV KDG VXIILFLHQW UHDVRQDEOH GLVWULFWFRXUWjVILQGLQJVRIIDFWLQWKLVFDVHVLPSO\FRQVLVWHGRI VXVSLFLRQWRGHWDLQ%DLOH\DIWHUWKHSXUSRVHVRIWKHWUDIILFVWRS H[FHUSWVRIWHVWLPRQ\IURPWKHVXSSUHVVLRQKHDULQJWKHFRXUW KDGEHHQDFFRPSOLVKHG:HKDYHKHOGWKDWm>D@QRUGLQDU\ GLG ODEHO DV mILQGLQJV RI IDFWl 'DYLGVRQjV DQG *UDKDPjV WUDIILF VWRS    LV PRUH DNLQ WR DQ LQYHVWLJDWLYH GHWHQWLRQ WHVWLPRQ\WKDWWKH\VWRSSHG%DLOH\EHFDXVHKHZDVGULYLQJRQ UDWKHUWKDQDFXVWRGLDODUUHVWDQGWKHSULQFLSOHVDQQRXQFHGLQ WKH ZURQJ VLGH RI WKH URDG DQG 'DYLGVRQjV WHVWLPRQ\ WKDW 7HUU\Y2KLR 86   DSSO\WRGHILQHWKHVFRSHRI %DLOH\ DOVR VHHPHG WR EH LQWR[LFDWHG  ,Q D VHFWLRQ RI WKH UHDVRQDEOHSROLFHFRQGXFWl+LOO )GDW7KHUHIRUH RSLQLRQHQWLWOHGmDSSOLFDWLRQRIWKHODZWRWKHIDFWVlWKHFRXUW mDQ\VXEVHTXHQWGHWHQWLRQDIWHUWKHLQLWLDOVWRSPXVWQRWEH ODWHUFRQFOXGHGWKDWFHUWDLQRWKHUIDFWVmXQGHUPLQHWKHDOOHJHG H[FHVVLYHO\ LQWUXVLYH LQ WKDW WKH RIILFHUjV DFWLRQV PXVW EH UHDVRQ IRU WKH µWUDIILF VWRSjl  s$ DW  0HP   %XW WKH UHDVRQDEO\ UHODWHG LQ VFRSH WR FLUFXPVWDQFHV MXVWLI\LQJ WKH FRXUWGRHVQRWDSSHDULQWKLVVHFWLRQWRTXHVWLRQWKHH[LVWHQFH RI D WUDIILF YLRODWLRQ  WKH FRXUW VLPSO\ FRQFOXGHG WKDW WKH WUDIILF YLRODWLRQ ZDV QRW WKH UHDO UHDVRQ IRU WKH VWRS  :H QRWH WKDW LW LV DQ RSHQ TXHVWLRQ LQ WKLV FLUFXLW ZKHWKHU D GLVWULFW 0RUHRYHU WKH PDJLVWUDWH MXGJH ZKR SUHVLGHG RYHU WKH FRXUW FDQ UHMHFW D PDJLVWUDWH MXGJHjV FUHGLELOLW\ GHWHUPLQDWLRQV ZLWKRXW VXSSUHVVLRQ KHDULQJ VSHFLILFDOO\ SURSRVHG D ILQGLQJ WKDW KROGLQJ D QHZ KHDULQJ 7KH 6XSUHPH &RXUW KDV QRWHG LQ GLFWD WKDW 'DYLGVRQjV DQG *UDKDPjV WHVWLPRQ\ UHJDUGLQJ WKH WUDIILF 7KH LVVXH LV QRW EHIRUH XV EXW ZH DVVXPH LW XQOLNHO\ WKDW D GLVWULFW MXGJH ZRXOG UHMHFW D PDJLVWUDWHjV SURSRVHG ILQGLQJV RQ FUHGLELOLW\ ZKHQ WKRVH ILQGLQJV DUH GLVSRVLWLYH DQG VXEVWLWXWH WKH MXGJHjV RZQ DSSUDLVDO WR GR VR ZLWKRXW VHHLQJ DQG KHDULQJ WKH ZLWQHVV RU ZLWQHVVHV ZKRVH FUHGLELOLW\ LV LQ TXHVWLRQ FRXOG ZHOO  ,Q WKH SRUWLRQ RI+XJXHQLQ FLWHG E\ WKH GLVWULFW FRXUW mSUHWH[Wl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m D WUDIILF YLRODWLRQ RU MXGJH LI WKH ULJKWV RI FULPLQDO GHIHQGDQWV ZRXOG EH LPSOLFDWHG 6HH HJ UHDVRQDEOH VXVSLFLRQ RI GUXJ WUDIILFNLQJ LW ZDV D YLRODWLRQ RI WKH )RXUWK +LOO Y %H\HU  )G   G &LU   *UDVVLD Y 6FXOO\   $PHQGPHQW IRU WKH SROLFH WR VHOHFWLYHO\ GHWDLQ PRWRULVWV ZLWK RXWRIVWDWH )G    G &LU   /RXLV Y %ODFNEXUQ  )G   WDJV   l ,G DW  HPSKDVLV DGGHG  WK &LU