Burchett v. Kieger

U.S. Court of Appeals for the Sixth Circuit

Burchett v. Kieger

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 D S

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

&+$5/(6 ( %85&+(77 ; &$5/$ %85&+(77  3ODLQWLIIV$SSHOODQWV   1R  Y !   *5(* .,()(5 5 . &23$6  721< 52%,1621 2+,2  %85($8 2) &5,0,1$/  ,19(67,*$7,21 3$8/ %/,66   s21 '2=(5 '(11,6 /2:(  :,//,$0 0255,6  'HIHQGDQWV$SSHOOHHV   1 $SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW IRUWKH6RXWKHUQ'LVWULFWRI2KLRDW&ROXPEXV 1R n(GPXQG$6DUJXVsU'LVWULFWsXGJH 6XEPLWWHG $XJXVW 'HFLGHGDQG)LOHG 1RYHPEHU  %HIRUH 0225(DQG*,/0$1&LUFXLWsXGJHV 526(1 'LVWULFWsXGJH

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

  %XUFKHWWHWDOY.LHIHUHWDO 1R 1R %XUFKHWWHWDOY.LHIHUHWDO 

BBBBBBBBBBBBBBBBB H[SDQG RQ WKLV FODLP SUHVXPDEO\ KH LV VXJJHVWLQJ WKDW RIILFHUVYLRODWHGKLV6L[WK$PHQGPHQWULJKWVE\UHIXVLQJWR &2816(/ LGHQWLI\DQ\VSHFLILFFKDUJHVDJDLQVWKLPGXULQJKLVWKUHHKRXU GHWHQWLRQ+RZHYHUWKHIDFWVWKDW%XUFKHWWDOOHJHVGRQRW 21%5,() 'DYLG/'D\6DPXHO$*UDGZRKO&ROXPEXV DPRXQWWRDFRQVWLWXWLRQDOYLRODWLRQDVWKH6L[WK$PHQGPHQW 2KLR IRU $SSHOODQWV  5DQGDOO /HH /DPEHUW 3DWULFLD 6 DSSOLHV RQO\ WR mFULPLQDO SURVHFXWLRQVl DQG QR VXFK 6DQGHUV/$0%(570F:+257(5 %2:/,1*,URQWRQ SURVHFXWLRQ KDG EHJXQ  86 &RQVW DPHQG 9,  6HH DOVR 2KLR .DUHQ s +XH\ 2)),&( 2) 7+( $77251(< sRQHVY&LW\RIsDFNVRQ)G WK&LU *(1(5$/2)2+,2&ROXPEXV2KLRIRU$SSHOOHHV m$GHIHQGDQWjVULJKWWREHLQIRUPHGRIWKHQDWXUHDQGFDXVH RIDQDFFXVDWLRQEURXJKWDJDLQVWKLPGRHVQRWH[LVWXQWLOWKH BBBBBBBBBBBBBBBBB *RYHUQPHQW LV FRPPLWWHG WR D SURVHFXWLRQl  .ODGLV Y %UH]HN)G WK&LU   m>7@KH6L[WK 23,1,21 $PHQGPHQWjVSURWHFWLRQGRHVQRWFRPHLQWRSOD\XQWLOWKH BBBBBBBBBBBBBBBBB JRYHUQPHQW KDV FRPPLWWHG LWVHOI WR SURVHFXWLRQl   $V QR .$5(1 1(/621 0225( &LUFXLW sXGJH  3ODLQWLIIV 6L[WK$PHQGPHQWYLRODWLRQRFFXUUHGVXPPDU\MXGJPHQWZDV &KDUOHVDQG&DUOD%XUFKHWWDSSHDOIURPDQRUGHUJUDQWLQJWKH DSSURSULDWHZLWKUHVSHFWWRWKLVFODLP GHIHQGDQWVjPRWLRQIRUVXPPDU\MXGJPHQW3ODLQWLIIVEURXJKW ,,,&21&/86,21 WKLVDFWLRQXQGHU86&† DJDLQVWFHUWDLQPHPEHUV RIWKHsDFNVRQ&RXQW\6KHULIIjV'HSDUWPHQWDQGRIWKH2KLR :H WKHUHIRUH $)),50 WKH JUDQW RI VXPPDU\ MXGJPHQW %XUHDXRI&ULPLQDO,GHQWLILFDWLRQDQG,QYHVWLJDWLRQDOOHJLQJ ZLWKUHVSHFWWRDOO6L[WK$PHQGPHQWFODLPVDQGZLWKUHVSHFW YLRODWLRQVRIWKHLU)RXUWK6L[WKDQG)RXUWHHQWK$PHQGPHQW WR WKH )RXUWK $PHQGPHQW FODLPV DJDLQVW &RSDV 'R]HU ULJKWV  7KH DOOHJHG YLRODWLRQV DURVH RXW RI DQ LQFLGHQW RQ /RZH5RELQVRQDQG0RUULV:H5(9(56(WKHJUDQWRI sXO\  ZKHQ&KDUOHV%XUFKHWWZDVVHL]HGKDQGFXIIHG VXPPDU\MXGJPHQWZLWKUHVSHFWWRWKH)RXUWK$PHQGPHQW DQGGHWDLQHGLQDSROLFHFDUZKLOHODZHQIRUFHPHQWRIILFLDOV FODLPVDJDLQVW.LHIHUDQG%OLVVDQGZH5(0$1'WKHFDVH H[HFXWHGDVHDUFKZDUUDQWRQWKHKRPHRIKLVEURWKHUZKR WRWKHGLVWULFWFRXUWIRUIXUWKHUSURFHHGLQJVFRQVLVWHQWZLWK OLYHG QH[W GRRU  7KH GLVWULFW FRXUW JUDQWHG DOO GHIHQGDQWVj WKLVRSLQLRQ PRWLRQV IRU VXPPDU\ MXGJPHQW FRQFOXGLQJ WKDW QR UHDVRQDEOHMXU\FRXOGILQGWKHGHIHQGDQWVWRKDYHYLRODWHGWKH %XUFKHWWVjULJKWV:H$)),50LQSDUWDQG5(9(56(LQ SDUW ,%$&.*5281' 7DNHQLQWKHOLJKWPRVWIDYRUDEOHWRWKHSODLQWLIIWKHIDFWV RIWKLVFDVHDUHDVIROORZV2QsXO\  PHPEHUVRIWKH 2KLR %XUHDX RI &ULPLQDO ,GHQWLILFDWLRQ DQG ,QYHVWLJDWLRQ m%&,l  ZHUH DVNHG WR DVVLVW WKH sDFNVRQ &RXQW\ 6KHULIIjV 'HSDUWPHQWLQH[HFXWLQJDVHDUFKZDUUDQWRQDKRXVHLQ2DN +LOO2KLRWKDWEHORQJHGWR&KDUOHV%XUFKHWWjVEURWKHU7KDW HYHQLQJ6KHULII.LHIHUOHGPHPEHUVRIWKHWZRWHDPVWRWKH  %XUFKHWWHWDOY.LHIHUHWDO 1R 1R %XUFKHWWHWDOY.LHIHUHWDO 

REVHUYHG%XUFKHWWEHLQJWDNHQLQWRFXVWRG\DQGKHREVHUYHG KRXVHWRVHDUFKIRUGUXJV&KDUOHV%XUFKHWWZKROLYHGQH[W %XUFKHWWLQWKHFUXLVHUVHYHUDOWLPHVRYHUDSHULRGRIKRXUV GRRUVDZXQPDUNHGYHKLFOHVSXOOLQWRKLVEURWKHUjVGULYHZD\ %OLVV VDZ WKDW WKH ZLQGRZV RQ WKH FUXLVHU ZHUH XS  %OLVV DQGKHZDONHGWRWKHHGJHRIWKHSURSHUW\OLQHEHWZHHQWKH WHVWLILHGWKDWLWZDVmH[WUHPHO\KRWlWKDWGD\s$DW %OLVV WZR KRXVHV IRU D EHWWHU YLHZ  7KH SDUWLHV DJUHH WKDW WKH 'HS DQGWKDWWKHKHDWKDGIRUFHGKLPWRDEDQGRQKLVVHDUFK SURSHUW\ OLQH LV DSSUR[LPDWHO\ WZHQW\ILYH IHHW IURP HDFK RI WKH DWWLF VHYHUDO WLPHV  *LYHQ WKH KHDW DQG %OLVVjV KRXVHDQGWKDWWKHWZRKRXVHVDUHWKXVDSSUR[LPDWHO\ILIW\ DZDUHQHVV RI WKH FRQGLWLRQV DQG OHQJWK RI %XUFKHWWjV IHHWDSDUW%XUFKHWWVDZWKUHHLQGLYLGXDOVDOORIZKRPKH GHWHQWLRQ WKHUH DUH JHQXLQH LVVXHV RI PDWHULDO IDFW ZLWK GHVFULEHVDVZHDULQJEODFNFORWKHVZLWKQRLGHQWLILFDWLRQDQG UHVSHFWWR%OLVVjVOLDELOLW\6LPLODUO\6KHULII*UHJ.LHIHUZDV WZRRIZKRPKHGHVFULEHVDVZHDULQJPDVNVZDONDURXQGWKH SUHVHQWZKHQWKHRIILFHUVGHWDLQHG%XUFKHWWLQWKHFUXLVHUDQG EDFN RI KLV EURWKHUjV KRXVH ZLWK ZHDSRQV  $FFRUGLQJ WR ZKHQ%XUFKHWWZDVUHOHDVHGDQG.LHIHUVWDWHGWKDWKHVDZ %XUFKHWWRQHRIWKHLQGLYLGXDOVnDOORIZKRPWXUQHGRXWWR %XUFKHWW LQ WKH FUXLVHU VHYHUDO WLPHV GXULQJ WKH GHWHQWLRQ EH%&,DJHQWVn\HOOHGDWKLPWRJHWRQWKHJURXQG $FFRUGLQJO\.LHIHUNQHZWKHOHQJWKRI%XUFKHWWjVGHWHQWLRQ LQWKHFDUDQGDUHDVRQDEOHRIILFHULQ.LHIHUjVSODFHZRXOG )HDULQJ IRU WKH VDIHW\ RI KLV EDE\ ZKR ZDV LQ D SRUFK KDYHUHFRJQL]HGWKHGDQJHUDQGWKHYLRODWLRQ VZLQJQHDUE\%XUFKHWWWXUQHGDQGUDQRQWRKLVSRUFK7KH RIILFHUVSXUVXHGKLPEHFDXVHLQ%&,$JHQW/RZHjVZRUGV 7KH HYLGHQFH GRHV QRW VKRZ WKDW DQ\ RI WKH RWKHU mDV,VDZKLPVWDQGLQJWKHUHLQWKH\DUGKHKDGVRPHWKLQJLQ GHIHQGDQWVZHUHDZDUHRUVKRXOGKDYHEHHQDZDUHRIWKRVH KLVKDQGDQG,FRXOGVHHLWZDVVRPHWKLQJEODFNDQGORRNHG IDFWV  'HSXW\ 6KHULII 5 + &RSDVjV FDU ZDV XVHG IRU WKH OLNHLWZDVDZHDSRQDWWKHWLPH6RKHWXUQHGDQGUDQKH GHWHQWLRQEXWWKHUHLVQRHYLGHQFHWKDWKHZDVDZDUHRIWKDW ZDVOHDYLQJ>WKHEURWKHUjV@SURSHUW\DQGZDVQjWREH\LQJP\ IDFWOHWDORQHDZDUHRIWKHFRQGLWLRQVRI%XUFKHWWjVGHWHQWLRQ FRPPDQGWRJHWRQWKHJURXQG6R,JDYHFKDVHEHFDXVH,IHOW %&,$JHQWsRQ'R]HUNQHZRIWKHKHDWDVKHZDVLQWKHDWWLF KH ZDV D WKUHDWl  sRLQW $SSHQGL[ ms$l  DW  /RZH ZLWK$JHQW%OLVVEXWWKHUHLVQRHYLGHQFHLQWKHUHFRUGWKDWKH 'HS $FFRUGLQJWR%XUFKHWWDQGKLVZLIH&DUODWKHRIILFHUV NQHZ RI %XUFKHWWjV GHWHQWLRQ  %&, $JHQW 'HQQLV /RZH IROORZHGKLPRQWRWKHSRUFKDQGVHL]HGKLPMXVWDVKHZDV WHVWLILHGWKDWKHVDZ%XUFKHWWLQWKHFUXLVHUEXWWKHUHLVQR UHDFKLQJIRUKLVEDE\&DUODWKHQFDPHRXWVLGHRQWRWKHSRUFK HYLGHQFHWKDWKHNQHZRIWKHOHQJWKRIWKHGHWHQWLRQDNH\ DQGWRRNWKHEDE\IURPWKHVZLQJ$WWKLVSRLQW%XUFKHWWKDG DVSHFWRIWKHGHWHQWLRQjVGDQJHURXVQHVV:HGRQRWILQGWKH QRWKLQJ LQ KLV KDQGV  WKH EODFN REMHFW WKDW ORRNHG OLNH D HYLGHQFHVXIILFLHQWWRLPSRVHOLDELOLW\RQ&RSDV'R]HURU ZHDSRQWXUQHGRXWWRKDYHEHHQ%XUFKHWWjVVXQJODVVHVZKLFK /RZH  7KHUH LV QR HYLGHQFH LQ WKH UHFRUG OLQNLQJ 'HSXW\ ZHUHQRZO\LQJRQWKHSRUFK 6KHULII 7RQ\ 5RELQVRQ RU %&, $JHQW :LOOLDP 0RUULV WR %XUFKHWWjVGHWHQWLRQ:HWKXVUHYHUVHWKHJUDQWRIVXPPDU\ 2WKHU RIILFHUV DUULYHG DQG WKH RIILFLDOV LPPHGLDWHO\ MXGJPHQWZLWKUHVSHFWWR.LHIHUDQG%OLVVDQGZHDIILUPWKH DWWHPSWHGWRKDQGFXII%XUFKHWW%XUFKHWWDGPLWVWRKDYLQJ JUDQW RI VXPPDU\ MXGJPHQW ZLWK UHVSHFW WR &RSDV 'R]HU m>W@ZLVWHGDQGWXUQHGVRPHlZKLOHEHLQJKDQGFXIIHGs$DW /RZH5RELQVRQDQG0RUULV  %XUFKHWW'HS DQGKLVZLIHVWDWHGWKDWKHZDVmNLQGRI MXPSLQJ DURXQGl s$ DW  &DUOD %XUFKHWW 'HS   %&, %7KH6L[WK$PHQGPHQW&ODLPV $JHQW%OLVVFODLPVWKDW%XUFKHWWNHSWRQHDUPRXWDQGZRXOG QRW OHW WKH RIILFHUV EULQJ LW GRZQ  7KH RIILFHUV HYHQWXDOO\ %XUFKHWWDOVRDOOHJHVWKDWWKHRIILFHUVjDFWLRQVYLRODWHGKLV VXFFHHGHG LQ KDQGFXIILQJ KLP DQG DFFRUGLQJ WR %XUFKHWW 6L[WK $PHQGPHQW ULJKW WR EH LQIRUPHG RI WKH QDWXUH DQG WKH\EHJDQSXVKLQJKLPLQWKHGLUHFWLRQRIWKHSDWUROFDUDQG FDXVHRIWKHFKDUJHVDJDLQVWKLP$OWKRXJK%XUFKHWWGRHVQRW RII WKHSRUFKZKLFKKDVDmVWHSGRZQlDQG%XUFKHWWIHOO  %XUFKHWWHWDOY.LHIHUHWDO 1R 1R %XUFKHWWHWDOY.LHIHUHWDO 

s$DW %XUFKHWW'HS +HZDVWKHQWDNHQDZD\DQGE\ :HDOVRFRQFOXGHWKDWXQGHUWKH6XSUHPH&RXUWjVUHFHQW KLVDFFRXQWmSXVKHGYHU\URXJKO\lLQWRDPDUNHG6KHULIIjV JXLGDQFHLQ+RSHY3HO]HUWKLVULJKWZDVFOHDUO\HVWDEOLVKHG 'HSDUWPHQW SDWURO FDU WKDW KDG DUULYHG DIWHU WKH XQPDUNHG IRUTXDOLILHGLPPXQLW\SXUSRVHV,Q+RSHWKH&RXUWPDGH FDUVs$DW FOHDUWKDWDULJKWFDQEHFOHDUO\HVWDEOLVKHGHYHQLIWKHUHLVQR FDVH LQYROYLQJ mIXQGDPHQWDOO\ VLPLODUl RU mPDWHULDOO\ %XUFKHWWZDVNHSWKDQGFXIIHGDQGLQWKHSROLFHFDUIRUWKUHH VLPLODUl IDFWV  6HH  6 &W DW   5DWKHU D ULJKW LV KRXUVZKLOHWKHVHDUFKZDVH[HFXWHG%\DOODFFRXQWVWKLV FOHDUO\ HVWDEOLVKHG ZKHQ m>W@KH UHDVRQLQJ WKRXJK QRW WKH ZDVDYHU\KRWGD\$OWKRXJKWKHLQFLGHQWEHJDQVRPHWLPH KROGLQJl RI D SULRU FRXUW RI DSSHDOV GHFLVLRQ SXWV ODZ DIWHU LQWKHDIWHUQRRQ%XUFKHWWWHVWLILHGWKDWWKHRXWGRRU HQIRUFHPHQWRIILFLDOVRQQRWLFHRUZKHQWKHmSUHPLVHlRIRQH WHPSHUDWXUHUHPDLQHGDWQLQHW\GHJUHHV7KHFDUjVZLQGRZV FDVHmKDVFOHDUDSSOLFDELOLW\lWRDVXEVHTXHQWVHWRIIDFWV6HH ZHUHLQLWLDOO\GRZQDQGWKHFDUZDVUXQQLQJEXWXSRQSODFLQJ LG DW   +HUH WKLV VWDQGDUG LV PHW  :H KDYH ORQJ %XUFKHWWLQWKHFDUWKHRIILFHUVUROOHGXSWKHZLQGRZVDQG UHFRJQL]HGIRULQVWDQFHWKDWWKH)RXUWK$PHQGPHQWSHUPLWV WXUQHGRIIWKHFDU7KHDLUFRQGLWLRQHUUHPDLQHGRIIDQGWKH GHWHQWLRQ XVLQJ RQO\ mWKH OHDVW LQWUXVLYH PHDQV UHDVRQDEO\ ZLQGRZVXSIRUWKHWKUHHKRXUV%XUFKHWWVD\VWKDWKHDVNHG DYDLODEOHl8QLWHG6WDWHVY6DQGHUV )G WK WKHRIILFHUVmWRUROOWKHZLQGRZGRZQWRJHWVRPHDLUlEXW &LU    TXRWDWLRQ RPLWWHG   6LPLODUO\ ZH KDYH WKH\WROGKLPm1RVKXW\RXUPRXWKls$DW %XUFKHWW UHFRJQL]HGWKDWmFODLPVRIH[FHVVLYHIRUFHGRQRWQHFHVVDULO\ 'HS $WOHDVWWZRRIWKHRIILFHUVZHUHDZDUHRIWKHKHDWWKDW UHTXLUHDOOHJDWLRQVRIDVVDXOWlEXWUDWKHUFDQFRQVLVWRIWKH GD\DV%&,$JHQW%OLVVWHVWLILHGWKDWZKLOHKHDQG%&,$JHQW SK\VLFDOVWUXFWXUHDQGFRQGLWLRQVRIWKHSODFHRIGHWHQWLRQ 'R]HUZHUHH[HFXWLQJWKHVHDUFKZDUUDQWLQWKHDWWLFRIWKH &RUQZHOO Y 'DKOEHUJ  )G   WK &LU   EURWKHUjVUHVLGHQFHWKHWHPSHUDWXUHVEHFDPHmH[WUHPHO\KRWl UHMHFWLQJ)RXUWK$PHQGPHQWH[FHVVLYHIRUFHFODLPRQWKH DQG WKH\ KDG WR VWHS RXWVLGH SHULRGLFDOO\ WR JHW VRPH DLU JURXQGVWKDWDFRQYLFWHGSULVRQHUFRXOGEULQJRQO\DQ(LJKWK s$DW %OLVV'HS %XUFKHWWjVZLIHWHVWLILHGWKDWZKHQKH $PHQGPHQW H[FHVVLYH IRUFH FODLP EXW UHFRJQL]LQJ WKDW ZDVHYHQWXDOO\OHWRXWRIWKHFDUKHZDVmVRSSLQJZHWIURP mGHWHQWLRQRQWKHFROGPXGG\JURXQGlFRXOGFRQVWLWXWHFODLP VZHDWls$DW &DUOD%XUFKHWW'HS  RIH[FHVVLYHIRUFH 7KHVHSUHPLVHVKDYHFOHDUDSSOLFDELOLW\ WR WKLV FDVH DQG WKH UHDVRQLQJ RI WKRVH FDVHV VKRXOG KDYH 6KHULII.LHIHUZKRREVHUYHG%XUFKHWWLQWKHFDUGHVFULEHG DOHUWHG UHDVRQDEOH RIILFHUV WR WKH FRQVWLWXWLRQDO YLRODWLRQV %XUFKHWWDVEHLQJmJHQHUDOO\LQDUDJHls$DW  .LHIHU LQKHUHQWLQVXEMHFWLQJDGHWDLQHHWRH[FHVVLYHKHDW6HHDOVR 'HS %&,$JHQW%OLVVWHVWLILHGWKDWKHVDZ%XUFKHWWWKUHHRU +RSH6&WDW KROGLQJWKDWKDQGFXIILQJLQPDWH WRKLWFKLQJSRVWDQGWKXVFDXVLQJmXQQHFHVVDU\H[SRVXUHWR WKH KHDW RI WKH VXQl YLRODWHG FOHDUO\ HVWDEOLVKHG (LJKWK  %&, $JHQW %OLVV WHVWLILHG WKDW WKH ZLQGRZV ZHUH UROOHG XS RQO\ DIWHU $PHQGPHQWULJKW  %XUFKHWW EHJDQ VSLWWLQJ DW SDVVHUVE\ +RZHYHU IRU SXUSRVHV RI VXPPDU\ MXGJPHQW ZH DFFHSW %XUFKHWWjV FODLP WKDW WKH ZLQGRZV ZHUH UROOHG XS :HPXVWWKXVLGHQWLI\WKRVHZKRVHPRWLRQVIRUVXPPDU\ LPPHGLDWHO\ DQG WKDW KH GLG QRW VSLW RQ SDVVHUVE\ MXGJPHQWVKRXOGKDYHEHHQGHQLHG%&,$JHQW3DXO%OLVVLV  VKRZQ WR KDYH EHHQ DZDUH RI WKH KHDW DQG WKH OHQJWK DQG %XUFKHWW VWDWHG GXULQJ KLV GHSRVLWLRQ WKDW ZKLOH KH ZDV LQ WKH FDU QDWXUHRI%XUFKHWWjVFRQILQHPHQW7REHVXUH%OLVVGLGQRW 2IILFHU 0LFKDHO 0XVLF RI WKH &LW\ RI sDFNVRQ 3ROLFH 'HSDUWPHQW VDLG m, KRSH \RX EXUQ XS LQ WKDW *RG GDPQ FDUl s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

%XUFKHWW JDYH WKHP QRWLFH WKH\ LPPHGLDWHO\ DFWHG  7KHLU IRXUWLPHVGXULQJWKDWSHULRGDQGWKDWKHRQFHWULHGWRFDOP DFWLRQV KDQGFXIILQJ %XUFKHWW GLG QRW YLRODWH %XUFKHWWjV %XUFKHWWE\VSHDNLQJZLWKKLPLQWKHFDU7RZDUGWKHHQGRI FRQVWLWXWLRQDOULJKWV WKH WKUHH KRXUV 6KHULII .LHIHU DVNHG %XUFKHWWjV ZLIH DQG GDXJKWHUWRVSHDNZLWK%XUFKHWWDQGFDOPKLPGRZQ7KH 6HFRQG%XUFKHWWFODLPVWKDWKLVGHWHQWLRQLQWKHSROLFHFDU RIILFHUV RSHQHG WKH ZLQGRZ VOLJKWO\ IRU WKHP WR GR VR DW ZLWKWKHZLQGRZVUROOHGXSLQQLQHW\GHJUHHKHDWIRUWKUHH ZKLFK SRLQW %XUFKHWW VKRZHG WKHP WKDW KLV KDQGV ZHUH KRXUVFRQVWLWXWHGH[FHVVLYHIRUFH:HDJUHHWKDWXQQHFHVVDU\ VZROOHQ DQG EOXH  %XUFKHWWjV GDXJKWHU SRLQWHG WKLV RXW WR GHWHQWLRQLQH[WUHPHWHPSHUDWXUHVOLNHWKRVHWKDWFRXOGEH .LHIHU ZKR WROG %XUFKHWW WKDW KH ZRXOG EH UHOHDVHG LI KH UHDFKHGLQDQXQYHQWLODWHGFDULQQLQHW\GHJUHHKHDWYLRODWHV SURPLVHGWREHKDYH%XUFKHWWDJUHHGZDVOHWRXWRIWKHFDU WKH )RXUWK $PHQGPHQWjV SURKLELWLRQV RQ XQUHDVRQDEOH DQGZDVUHOHDVHGIURPWKHKDQGFXIIV%XUFKHWWZDVJLYHQD VHDUFKHV DQG VHL]XUHV  7KH 6XSUHPH &RXUW KDV QRWHG WKDW FLWDWLRQ IRU GLVRUGHUO\ FRQGXFW EXW WKH FKDUJHV ZHUH ODWHU XQGHUFHUWDLQFLUFXPVWDQFHVmXQQHFHVVDU\H[SRVXUHWRWKHKHDW GLVPLVVHG RI WKH VXQ WR SURORQJHG WKLUVW DQG WDXQWLQJ DQG WR D GHSULYDWLRQ RI EDWKURRP EUHDNVl FDQ YLRODWH WKH (LJKWK %XUFKHWW FODLPV WKDW KH VXIIHUHG SK\VLFDO DQG HPRWLRQDO $PHQGPHQWjV SURKLELWLRQ RQ mXQQHFHVVDU\ DQG ZDQWRQ LQMXULHVDVDUHVXOWRIKLVGHWHQWLRQ7KHGHWHQWLRQLQWKHKHDW LQIOLFWLRQRISDLQl+RSH6&WDW6XFKDFWLRQVD FDXVHG H[WUHPH GLVFRPIRUW DQG WKH KDQGFXIIV FDXVHG IRUWLRUL YLRODWH WKH )RXUWK $PHQGPHQW ZKLFK UHTXLUHV D VZHOOLQJDEUDVLRQVDQGWKUHHRUIRXUGD\VRIPLVVHGZRUN VKRZLQJ RI REMHFWLYH XQUHDVRQDEOHQHVV UDWKHU WKDQ DQ\ +H IHDUV WKDW SROLFH ZLOO mDWWDFNl KLP DJDLQ DQG KLV ZLIH SDUWLFXODUVXEMHFWLYHPRWLYDWLRQ6HH*UDKDPY&RQQRU  VWDWHVWKDWKHKDVKDGQLJKWPDUHVVLQFHWKHQ%XUFKHWWjVZLIH 86     DOVRVWDWHVWKDWVKHKDVH[SHULHQFHGPHQWDODQJXLVKDVDUHVXOW RIWKHLQFLGHQW )XUWKHUWKHJRYHUQPHQWj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jV FRROLQJ RU YHQWLODWLRQ GHYLFHV  ,I WKH DGGHGDQGGURSSHGQXPHURXVGHIHQGDQWVVLQFHWKHFDVHZDV GHWDLQHH GLG VSLW XSRQ RIILFHUV RU SDVVHUVE\ RU RWKHUZLVH ILUVWILOHGEXWDWWKHVXPPDU\MXGJPHQWVWDJHWKHIROORZLQJ GLVUXSWHG WKH RIILFHUVj VHDUFK DQG WKH RIILFHUV FRXOG QRW GHIHQGDQWVUHPDLQHG 6KHULII*UHJ.LHIHU'HSXW\6KHULII5 RWKHUZLVHHIIHFWLYHO\VHSDUDWHWKHGHWDLQHHIURPSDVVHUVE\ +&RSDVDQG'HSXW\6KHULII7RQ\5RELQVRQRIWKHsDFNVRQ DUHDVRQDEOHRIILFHUPLJKWFRQFOXGHWKDWFORVLQJWKHZLQGRZV &RXQW\ 6KHULIIjV 'HSDUWPHQW DV ZHOO DV %&, $JHQWV 3DXO ZDV QHFHVVDU\  5HVROYLQJ IDFWXDO GLVSXWHV LQ %XUFKHWWjV %OLVVs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

HVWDEOLVKHGRUNQRZQE\UHDVRQDEOHSHRSOHWKHFRXUWUXOHG )LUVWZHFRQFOXGHWKDWWKHRIILFHUVGLGQRWXVHH[FHVVLYH WKDWQRFRQVWLWXWLRQDOYLRODWLRQVKDGRFFXUUHG%HFDXVHWKH IRUFHLQKDQGFXIILQJ%XUFKHWW7KHRIILFHUVDGPLWWKDWWKH\ )RXUWK$PHQGPHQWGRHVQRWSURKLELWSROLFHIURPGHWDLQLQJ KDGWRXVHIRUFHLQUHVWUDLQLQJKLPEXWm>Q@RWHYHU\SXVKRU LQGLYLGXDOVSUHVHQWGXULQJDVHDUFKLQRUGHUWRSUHYHQWIOLJKW VKRYHHYHQLILWPD\ODWHUVHHPXQQHFHVVDU\YLRODWHVWKH HQVXUH VDIHW\ DQG SURWHFW HYLGHQFH DQG WKH GLVWULFW FRXUW )RXUWK$PHQGPHQWl*UDKDP 86DW  TXRWDWLRQ IRXQG WKDW WKH GHWHQWLRQ RI %XUFKHWW ZDV UHDVRQDEOH LW RPLWWHG ,QIDFW%XUFKHWWjVRZQVWDWHPHQWVLQGLFDWHWKDWWKH FRQFOXGHG WKDW QR )RXUWK $PHQGPHQW YLRODWLRQ RFFXUUHG LQLWLDOIRUFHXVHGWRUHVWUDLQKLPPD\KDYHEHHQQHFHVVDU\ 7KHGLVWULFWFRXUWDOVRDSSDUHQWO\LQWHUSUHWHG%XUFKHWWjV6L[WK %XUFKHWW DFNQRZOHGJHG WKDW KH mWZLVWHG DQG WXUQHG VRPHl $PHQGPHQW FODLP WR EH D FODLP UHJDUGLQJ KLV ULJKW WR ZKHQ WKH\ WULHG WR KDQGFXII KLP DQG WKDW WKH RIILFHUV KDG FRXQVHO  %HFDXVH WKDW ULJKW GRHV QRW DWWDFK XQWLO WKH GLIILFXOW\UHVWUDLQLQJKLPs$DW %XUFKHWW'HS 7KHUH EHJLQQLQJRIDGYHUVDULDOFULPLQDOSURFHHGLQJVWKHFRXUWUXOHG LV QR JHQXLQH LVVXH ZLWK UHVSHFW WR WKHVH IDFWV DQG WKH WKDWQR6L[WK$PHQGPHQWULJKWZDVYLRODWHG RIILFHUVjXVHRIIRUFHZDVUHDVRQDEOH ,,$1$/<6,6 7KHWLJKWQHVVRIWKHKDQGFXIIVWKHPVHOYHVFDXVHVJUHDWHU FRQFHUQ  7KH ULJKW WR EH IUHH IURP mH[FHVVLYHO\ IRUFHIXO :H UHYLHZ D GLVWULFW FRXUW V GHFLVLRQ JUDQWLQJ VXPPDU\ KDQGFXIILQJl LV D FOHDUO\ HVWDEOLVKHG ULJKW IRU TXDOLILHG MXGJPHQWGHQRYR*HQ(OHF&RY*6LHPSHONDPS*PE+ LPPXQLW\SXUSRVHV.RVWU]HZDY&LW\RI7UR\)G  &R   )G     WK &LU     6XPPDU\  WK&LU DQGDSSO\LQJKDQGFXIIVVRWLJKWO\WKDWWKH MXGJPHQWLVSURSHURQO\LIWKHUHLVQRJHQXLQHLVVXHDVWRDQ\ GHWDLQHHjVKDQGVEHFRPHQXPEDQGWXUQEOXHFHUWDLQO\UDLVHV PDWHULDOIDFWDQGWKHPRYLQJSDUW\LVHQWLWOHGWRDMXGJPHQWDV FRQFHUQV RI H[FHVVLYH IRUFH  2XU SUHFHGHQWV DOORZ WKH DPDWWHURIODZ)HG5&LY3 F :HPXVWORRNEH\RQG SODLQWLII WR JHW WR D MXU\ XSRQ D VKRZLQJ WKDW RIILFHUV WKHSOHDGLQJVDQGPXVWDVVHVVWKHSURRIWRGHWHUPLQHZKHWKHU KDQGFXIIHGWKHSODLQWLIIH[FHVVLYHO\DQGXQQHFHVVDULO\WLJKWO\ WKHUHLVDJHQXLQHLVVXHIRUWULDO6HH0DWVXVKLWD(OHF,QGXV DQGLJQRUHGWKHSODLQWLIIjVSOHDVWKDWWKHKDQGFXIIVZHUHWRR &RY=HQLWK5DGLR&RUS86   7KH WLJKW  6HH LG  0DUWLQ Y +HLGHPDQ  )G   SURSHU LQTXLU\ LV ZKHWKHU WKH HYLGHQFH LV VXFK WKDW D  WK&LU   UHYHUVLQJGLUHFWHGYHUGLFWLQIDYRURI UHDVRQDEOH MXU\ FRXOG UHWXUQ D YHUGLFW IRU WKH QRQPRYLQJ GHIHQGDQWVRQH[FHVVLYHIRUFHFODLPZKHQSODLQWLIIjVKDQGV SDUW\6HH$QGHUVRQY/LEHUW\/REE\,QF86 ZHUHLQMXUHGDIWHUWKLUW\ILYHPLQXWHVLQWLJKWKDQGFXIIV      m5XOH  F  PDQGDWHV WKH HQWU\ RI VXPPDU\ MXGJPHQWDIWHUDGHTXDWHWLPHIRUGLVFRYHU\DQGXSRQPRWLRQ 8QOLNHWKHRIILFHUVLQ.RVWU]HZDDQG0DUWLQKRZHYHUWKH DJDLQVW D SDUW\ ZKR IDLOV WR PDNH D VKRZLQJ VXIILFLHQW WR RIILFHUVKHUHGLGQRWLJQRUHDQ\SOHDWKDWWKHKDQGFXIIVZHUH HVWDEOLVKWKHH[LVWHQFHRIDQHOHPHQWHVVHQWLDOWRWKDWSDUW\ V WRRWLJKW7RWKHFRQWUDU\%XUFKHWWFRPSODLQHGRQO\RQFH FDVHDQGRQZKLFKWKDWSDUW\ZLOOEHDUWKHEXUGHQRISURRIDW DQGRQWKDWRFFDVLRQ6KHULII.LHIHULPPHGLDWHO\RIIHUHGWR WULDOl&HORWH[&RUSY&DWUHWW86   ,Q UHPRYH WKH KDQGFXIIV LI %XUFKHWW ZRXOG EHKDYH  %XUFKHWW FRQGXFWLQJWKHVXPPDU\MXGJPHQWDQDO\VLVZHPXVWYLHZDOO DJUHHGDQGWKHKDQGFXIIVZHUHUHPRYHG7KHUHFRUGJLYHVQR LQIHUHQFHVWREHGUDZQIURPWKHXQGHUO\LQJIDFWVLQWKHOLJKW LQGLFDWLRQWKDW%XUFKHWWKDGSUHYLRXVO\FRPSODLQHGRUDGYLVHG PRVWIDYRUDEOHWRWKHQRQPRYLQJSDUW\6HH*HQ(OHF&R WKHRIILFHUVWKDWWKHKDQGFXIIVZHUHWRRWLJKW.LHIHUjVSURPSW  )GDW   UHVSRQVH ZKHQ %XUFKHWW ILQDOO\ GLG FRPSODLQ GLVWLQJXLVKHV WKLVFDVHIURPWKRVHLQZKLFKZHKDYHIRXQGFRQVWLWXWLRQDO 7KH %XUFKHWWVj FODLPV PXVW EH HYDOXDWHG XQGHU WKH YLRODWLRQV8QWLOWKH\KDGQRWLFHWKDWWKHKDQGFXIIVZHUHWRR IUDPHZRUNRITXDOLILHGLPPXQLW\$FFRUGLQJWRWKHGRFWULQH WLJKW WKH RIILFHUV ZHUH XQDZDUH RI WKH SUREOHP  2QFH  %XUFKHWWHWDOY.LHIHUHWDO 1R 1R %XUFKHWWHWDOY.LHIHUHWDO 

LGHQWLILHG%XUFKHWWjVSUHVHQFHRQWKHSURSHUW\OLQHDQGKLV RI TXDOLILHG LPPXQLW\ mJRYHUQPHQW RIILFLDOV SHUIRUPLQJ IOLJKW XSRQ HQFRXQWHULQJ WKH RIILFHUV ZRXOG VXJJHVW WR D GLVFUHWLRQDU\IXQFWLRQVJHQHUDOO\DUHVKLHOGHGIURPOLDELOLW\ UHDVRQDEOHODZHQIRUFHPHQWRIILFLDOWKDWKHSRVHGDVLPLODU IRU FLYLO GDPDJHV LQVRIDU DV WKHLU FRQGXFW GRHV QRW YLRODWH ULVN RI IOLJKW DQG GDQJHU WR RWKHUV DV DQ LQGLYLGXDO ZKR FOHDUO\HVWDEOLVKHGVWDWXWRU\RUFRQVWLWXWLRQDOULJKWVRIZKLFK DUULYHGDWWKHSUHPLVHVGXULQJDVHDUFK6HH%RKDQQRQ D UHDVRQDEOH SHUVRQ ZRXOG KDYH NQRZQl  +DUORZ Y )GDW7KDWRIILFHUVDUULYHGDQGVRXJKWWRGHWDLQKLP )LW]JHUDOG86   4XDOLILHGLPPXQLW\ nLQWKHPRVWPLQLPDOVHQVHDWILUVWE\\HOOLQJIRUKLPWR LQYROYHVDWZRVWHSLQTXLU\)LUVWWKHFRXUWPXVWGHWHUPLQH JHW GRZQ n ZKLOH KH ZDV VWLOO RQH VWHS DZD\ IURP WKH ZKHWKHUEDVHGXSRQWKHDSSOLFDEOHODZWKHIDFWVYLHZHGLQ SURSHUW\OLQHVHHPVOLNHDQDUELWUDU\GLVWLQFWLRQWKDWZRXOG WKH OLJKW PRVW IDYRUDEOH WR WKH SODLQWLIIV VKRZ WKDW D XQGHUPLQHWKHSROLFLHVH[SUHVVHGLQ6XPPHUV FRQVWLWXWLRQDO YLRODWLRQ KDV RFFXUUHG  ,I WKH FRXUW ILQGV D FRQVWLWXWLRQDO YLRODWLRQ LW PXVW WKHQ FRQVLGHU ZKHWKHU WKH :H WKHUHIRUH FRQFOXGH WKDW WKH RIILFHUVj GHWHQWLRQ RI YLRODWLRQLQYROYHVmµFOHDUO\HVWDEOLVKHGFRQVWLWXWLRQDOULJKWV %XUFKHWWGLGQRWYLRODWHKLV)RXUWK$PHQGPHQWULJKWV RI ZKLFK D UHDVRQDEOH SHUVRQ ZRXOG KDYH NQRZQjl 'LFNHUVRQY0F&OHOODQ)G WK&LU  7KH2IILFHUVj8VHRI)RUFH$JDLQVW%XUFKHWW TXRWLQJ&KULVWRSKHOY.XNXOLQVN\)G  WK&LU    VHH DOVR 6DXFLHU Y .DW]  86    &ODLPVUHJDUGLQJSROLFHRIILFHUVjXVHRIH[FHVVLYHIRUFHLQ  )RUDULJKWWREHFOHDUO\HVWDEOLVKHGm>W@KHFRQWRXUV WKHFRXUVHRIDQDUUHVWRURWKHUVHL]XUHDUHJRYHUQHGE\WKH RIWKHULJKWPXVWEHVXIILFLHQWO\FOHDUWKDWDUHDVRQDEOHRIILFLDO )RXUWK$PHQGPHQW6HH3KHOSVY&R\)G  ZRXOGXQGHUVWDQGWKDWZKDWKHLVGRLQJYLRODWHVWKDWULJKWl WK&LU  FLWLQJ*UDKDPY&RQQRU 86  5XVVRY&LW\RI&LQFLQQDWL )G WK&LU   7KH)RXUWK$PHQGPHQWUHTXLUHVWKDWDQRIILFHUjV    TXRWLQJ $QGHUVRQ Y &UHLJKWRQ  86   XVH RI IRUFH EH REMHFWLYHO\ UHDVRQDEOH DQG FRXUWV PXVW     m$OWKRXJK LW QHHG QRW EH WKH FDVH WKDW µWKH YHU\ EDODQFH WKH FRQVHTXHQFHV WR WKH LQGLYLGXDO DJDLQVW WKH DFWLRQLQTXHVWLRQKDVEHHQSUHYLRXVO\KHOGXQODZIXOLQ JRYHUQPHQWjVLQWHUHVWVLQHIIHFWLQJWKHVHL]XUH6HH*UDKDP WKH OLJKW RI SUHH[LVWLQJ ODZ WKH XQODZIXOQHVV PXVW EH  86DW 7KLVVWDQGDUGFRQWDLQVDEXLOWLQPHDVXUHRI DSSDUHQWjl,G TXRWLQJ$QGHUVRQ86DW $VWKH GHIHUHQFHWRWKHRIILFHUjVRQWKHVSRWMXGJPHQWDERXWWKHOHYHO 6XSUHPH &RXUW QRWHG LQ +RSH Y 3HO]HU BB 86 BB  RI IRUFH QHFHVVDU\ LQ OLJKW RI WKH FLUFXPVWDQFHV RI WKH 6&W  DQDFWLRQjVXQODZIXOQHVVFDQEH SDUWLFXODUFDVH6HHLG&RXUWVHYDOXDWLQJWKHUHDVRQDEOHQHVV DSSDUHQWIURPGLUHFWKROGLQJVVSHFLILFH[DPSOHVGHVFULEHGDV RIIRUFHXVHGmVKRXOGSD\SDUWLFXODUDWWHQWLRQWRµWKHVHYHULW\ SURKLELWHG RU IURP WKH JHQHUDO UHDVRQLQJ WKDW D FRXUW RIWKHFULPHDWLVVXHZKHWKHUWKHVXVSHFWSRVHVDQLPPHGLDWH HPSOR\V WKUHDWWRWKHVDIHW\RIWKHRIILFHUVRURWKHUVDQGZKHWKHUKHLV DFWLYHO\ UHVLVWLQJ DUUHVW RU DWWHPSWLQJ WR HYDGH DUUHVW E\ $7KH)RXUWK$PHQGPHQW&ODLPV IOLJKWjl'DUUDKY&LW\RI2DN3DUN)G WK &LU  TXRWLQJ*UDKDP 86DW   7KH %XUFKHWWV DUJXH WKDW WKH RIILFHUVj EHKDYLRU YLRODWHG &KDUOHV%XUFKHWWjV)RXUWK$PHQGPHQWULJKWWREHIUHHIURP 4XHVWLRQV RI H[FHVVLYH IRUFH DULVH ZLWK UHVSHFW WR WKH DQXQUHDVRQDEOHVHDUFKDQGVHL]XUH7KHUHLVQRTXHVWLRQWKDW RIILFHUVjKDQGFXIILQJRI%XUFKHWWDQGWKHLUGHWDLQLQJKLPIRU %XUFKHWWjV GHWHQWLRQ FRQVWLWXWHG D mVHL]XUHl ZLWKLQ WKH WKUHHKRXUVLQDQXQYHQWLODWHGSROLFHFDULQH[WUHPHKHDW:H PHDQLQJRIWKH)RXUWK$PHQGPHQW6HH7HUU\Y2KLR  WDNHWKHWZRLQWXUQ 86    m>:@KHQHYHUDSROLFHRIILFHUDFFRVWVDQ LQGLYLGXDO DQG UHVWUDLQV KLV IUHHGRP WR ZDON DZD\ KH KDV  %XUFKHWWHWDOY.LHIHUHWDO 1R 1R %XUFKHWWHWDOY.LHIHUHWDO

µVHL]HGjWKDWSHUVRQl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j3RZHUWR'HWDLQ%XUFKHWW ILUVWRIWKHPIRULGHQWLILFDWLRQDQGZKHQWKHRWKHUHQJDJHGLQ QHUYRXVEHKDYLRUSDWWHGGRZQWKHVHFRQGIRXQGGUXJVDQG ,Q0LFKLJDQY6XPPHUV86    WKH6XSUHPH DUUHVWHG KLP  6HH LG  1RWLQJ WKDW WKH SROLFLHV XQGHUO\LQJ &RXUWUXOHGWKDWmDZDUUDQWWRVHDUFKIRUFRQWUDEDQGIRXQGHG 6XPPHUV DQG )RXQWDLQ HVSHFLDOO\ RIILFHU VDIHW\ DSSOLHG RQ SUREDEOH FDXVH LPSOLFLWO\ FDUULHV ZLWK LW WKH OLPLWHG HTXDOO\ WR WKH GHWHQWLRQ RI LQGLYLGXDOV DUULYLQJ DW D VHDUFK DXWKRULW\ WR GHWDLQ WKH RFFXSDQWV RI WKH SUHPLVHV ZKLOH D VFHQHWKHFRXUWUXOHGWKDWVXFKDGHWHQWLRQZDVQRWDYLRODWLRQ SURSHUVHDUFKLVFRQGXFWHGl,GDW IRRWQRWHVRPLWWHG  RIWKH)RXUWK$PHQGPHQW6HHLGDWVHHDOVRLG FLWLQJ ,Q6XPPHUVSROLFHDSSURDFKLQJDKRXVHWRH[HFXWHDVHDUFK %DNHU Y 0RQURH 7RZQVKLS  )G    G &LU ZDUUDQWVDZWKHRZQHURIWKHKRXVHOHDYLQJDQGGHWDLQHGKLP    m$OWKRXJK6XPPHUVLWVHOIRQO\SHUWDLQVWRDUHVLGHQW IRUWKHGXUDWLRQRIWKHVHDUFK,GDW 7KH&RXUWUHDVRQHG RIWKHKRXVHXQGHUVHDUFKLWIROORZVWKDWWKHSROLFHPD\VWRS WKDWVXFKDGHWHQWLRQZDVSHUPLVVLEOHHYHQZLWKRXWSUREDEOH SHRSOHFRPLQJWRRUJRLQJIURPWKHKRXVHLISROLFHQHHGWR FDXVHEHFDXVHLQDVPXFKDVLWLQYROYHGDOLPLWHGGHWHQWLRQDW DVFHUWDLQZKHWKHUWKH\OLYHWKHUHl  WKHLQGLYLGXDOj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n SUREDEOHFDXVH6HHLGDW   ZKLFKWKHSDUWLHVDJUHHZRXOGSODFHKLPMXVWWZHQW\ILYHIHHW DZD\IURPKLVEURWKHUjVKRXVHnLQRUGHUWRVHHZKDWZDV :HKDYHH[WHQGHGSROLFHRIILFHUVjSRZHUVXQGHU6XPPHUV JRLQJ RQ %XUFKHWW VWDWHV WKDW KH UHPDLQHG RQ KLV RZQ LQWZRLPSRUWDQWUHVSHFWV)LUVWLQ8QLWHG6WDWHVY)RXQWDLQ SURSHUW\  ,QDVPXFK DV %RKDQQRQ LQYROYHG GHWDLQHHV ZKR )G WK&LU FHUWGHQLHG86    GURYH XS WKH GULYHZD\ SDUNHG QHDU WKH UHVLGHQFHjV IURQW DQGRYHUUXOHGRQRWKHUJURXQGV7UHSHOY5RDGZD\([SUHVV SRUFKDQGZDONHGWRZDUGWKHUHVLGHQFHVHH%RKDQQRQ ,QF )G WK&LU WKLVFRXUWUXOHGWKDW )GDW%RKDQQRQGRHVQRWFRQWUROWKLVFDVH%XUFKHWW WKH6XSUHPH&RXUWjVGLVFXVVLRQRImRFFXSDQWVlLQ6XPPHUV QHYHUmDUULYHGlDWWKHVHDUFKHGSUHPLVHV LQFOXGHGQRQUHVLGHQWVZKRDUHSUHVHQWDWWKHVFHQHRIDVHDUFK ZKHQSROLFHDUULYH7KHFRXUWQRWHGWKDWWZRRIWKH6XPPHUV $OWKRXJKWKHRIILFHUVKHUHZHUHQRWZLWKLQWKHVWULFWOLPLWV IDFWRUV DSSOLHG HTXDOO\ WR QRQUHVLGHQWV ZKR DUH SUHVHQW RI6XPPHUVZHKROGWKDWRIILFHUVDFWZLWKLQWKHLU6XPPHUV EHFDXVH DOORZLQJ SROLFH WR GHWDLQ VXFK LQGLYLGXDOV ZRXOG SRZHUV ZKHQ WKH\ GHWDLQ DQ LQGLYLGXDO ZKR DSSURDFKHV D IXUWKHU6XPPHUVjVJRDOVRISUHYHQWLQJIOLJKWDQGPLQLPL]LQJ SURSHUW\EHLQJVHDUFKHGSXUVXDQWWRDZDUUDQWSDXVHVDWWKH WKHULVNWRRIILFHUV6HHLG SURSHUW\OLQHDQGIOHHVZKHQWKHRIILFHUVLQVWUXFWKLPWRJHW GRZQ$OWKRXJKWKLVUHDFKHVEH\RQG6XPPHUVjVmRFFXSDQWVl 6HFRQGLQ8QLWHG6WDWHVY%RKDQQRQ)G ODQJXDJH LW LV FRQVLVWHQW ZLWK WKH SROLFLHV WKDW 6XPPHUV WK &LU   ZH UXOHG WKDW RIILFHUV FRXOG DOVR GHWDLQ

Reference

Status
Published