02a0398p.06

01-3301Court of Appeals for the Sixth CircuitNov 19, 2002

Full text

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

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
&+$5/(6 ( %85&+(77
&$5/$ %85&+(77
3ODLQWLIIV$SSHOODQWV
Y
*5(* .,()(5 5 . &23$6
721< 52%,1621 2+,2
%85($8 2) &5,0,1$/
,19(67,*$7,21 3$8/ %/,66
-21 '2=(5 '(11,6 /2:(
:,//,$0 0255,6
'HIHQGDQWV$SSHOOHHV
;!

1
1R
$SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
IRUWKH6RXWKHUQ'LVWULFWRI2KLRDW&ROXPEXV
1R²(GPXQG$6DUJXV-U'LVWULFW-XGJH
6XEPLWWHG$XJXVW
'HFLGHGDQG)LOHG1RYHPEHU
%HIRUH0225(DQG*,/0$1&LUFXLW-XGJHV526(1
'LVWULFW-XGJH

-- 1 of 8 --

%XUFKHWWHWDOY.LHIHUHWDO 1R
BBBBBBBBBBBBBBBBB
&2816(/
21%5,()'DYLG/'D\6DPXHO$*UDGZRKO&ROXPEXV
2KLR IRU $SSHOODQWV 5DQGDOO /HH /DPEHUW 3DWULFLD 6
6DQGHUV/$0%(570F:+257(5 %2:/,1*,URQWRQ
2KLR .DUHQ - +XH\ 2)),&( 2) 7+( $77251(<
*(1(5$/2)2+,2&ROXPEXV2KLRIRU$SSHOOHHV
BBBBBBBBBBBBBBBBB
23,1,21
BBBBBBBBBBBBBBBBB
.$5(1 1(/621 0225( &LUFXLW -XGJH 3ODLQWLIIV
&KDUOHVDQG&DUOD%XUFKHWWDSSHDOIURPDQRUGHUJUDQWLQJWKH
GHIHQGDQWV¶PRWLRQIRUVXPPDU\MXGJPHQW3ODLQWLIIVEURXJKW
WKLVDFWLRQXQGHU86&†DJDLQVWFHUWDLQPHPEHUV
RIWKH-DFNVRQ&RXQW\6KHULII¶V'HSDUWPHQWDQGRIWKH2KLR
%XUHDXRI&ULPLQDO,GHQWLILFDWLRQDQG,QYHVWLJDWLRQDOOHJLQJ
YLRODWLRQVRIWKHLU)RXUWK6L[WKDQG)RXUWHHQWK$PHQGPHQW
ULJKWV 7KH DOOHJHG YLRODWLRQV DURVH RXW RI DQ LQFLGHQW RQ
-XO\ZKHQ&KDUOHV%XUFKHWWZDVVHL]HGKDQGFXIIHG
DQGGHWDLQHGLQDSROLFHFDUZKLOHODZHQIRUFHPHQWRIILFLDOV
H[HFXWHGDVHDUFKZDUUDQWRQWKHKRPHRIKLVEURWKHUZKR
OLYHGQH[WGRRU7KHGLVWULFWFRXUWJUDQWHGDOOGHIHQGDQWV¶
PRWLRQV IRU VXPPDU\ MXGJPHQW FRQFOXGLQJ WKDW QR
UHDVRQDEOHMXU\FRXOGILQGWKHGHIHQGDQWVWRKDYHYLRODWHGWKH
%XUFKHWWV¶ULJKWV:H$)),50LQSDUWDQG5(9(56(LQ
SDUW
,%$&.*5281'
7DNHQLQWKHOLJKWPRVWIDYRUDEOHWRWKHSODLQWLIIWKHIDFWV
RIWKLVFDVHDUHDVIROORZV2Q-XO\PHPEHUVRIWKH
2KLR %XUHDX RI &ULPLQDO ,GHQWLILFDWLRQ DQG ,QYHVWLJDWLRQ
³%&,´ ZHUHDVNHG WRDVVLVWWKH-DFNVRQ&RXQW\6KHULII¶V
'HSDUWPHQWLQH[HFXWLQJDVHDUFKZDUUDQWRQDKRXVHLQ2DN
+LOO2KLRWKDWEHORQJHGWR&KDUOHV%XUFKHWW¶VEURWKHU7KDW
HYHQLQJ6KHULII.LHIHUOHGPHPEHUVRIWKHWZRWHDPVWRWKH
1R %XUFKHWWHWDOY.LHIHUHWDO
H[SDQG RQ WKLV FODLP SUHVXPDEO\ KH LV VXJJHVWLQJ WKDW
RIILFHUVYLRODWHGKLV6L[WK$PHQGPHQWULJKWVE\UHIXVLQJWR
LGHQWLI\DQ\VSHFLILFFKDUJHVDJDLQVWKLPGXULQJKLVWKUHHKRXU
GHWHQWLRQ+RZHYHUWKHIDFWVWKDW%XUFKHWWDOOHJHVGRQRW
DPRXQWWRDFRQVWLWXWLRQDOYLRODWLRQDVWKH6L[WK$PHQGPHQW
DSSOLHV RQO\ WR ³FULPLQDO SURVHFXWLRQV´ DQG QR VXFK
SURVHFXWLRQ KDG EHJXQ 86 &RQVW DPHQG 9, 6HH DOVR
-RQHVY&LW\RI-DFNVRQ)G WK&LU
³$GHIHQGDQW¶VULJKWWREHLQIRUPHGRIWKHQDWXUHDQGFDXVH
RIDQDFFXVDWLRQEURXJKWDJDLQVWKLPGRHVQRWH[LVWXQWLOWKH
*RYHUQPHQW LV FRPPLWWHG WR D SURVHFXWLRQ´ .ODGLV Y
%UH]HN)G WK&LU ³>7@KH6L[WK
$PHQGPHQW¶VSURWHFWLRQGRHVQRWFRPHLQWRSOD\XQWLOWKH
JRYHUQPHQWKDVFRPPLWWHGLWVHOIWRSURVHFXWLRQ´ $VQR
6L[WK$PHQGPHQWYLRODWLRQRFFXUUHGVXPPDU\MXGJPHQWZDV
DSSURSULDWHZLWKUHVSHFWWRWKLVFODLP
,,,&21&/86,21
:H WKHUHIRUH $)),50 WKH JUDQW RI VXPPDU\ MXGJPHQW
ZLWKUHVSHFWWRDOO6L[WK$PHQGPHQWFODLPVDQGZLWKUHVSHFW
WR WKH )RXUWK $PHQGPHQW FODLPV DJDLQVW &RSDV 'R]HU
/RZH5RELQVRQDQG0RUULV:H5(9(56(WKHJUDQWRI
VXPPDU\MXGJPHQWZLWKUHVSHFWWRWKH)RXUWK$PHQGPHQW
FODLPVDJDLQVW.LHIHUDQG%OLVVDQGZH5(0$1'WKHFDVH
WRWKHGLVWULFWFRXUWIRUIXUWKHUSURFHHGLQJVFRQVLVWHQWZLWK
WKLVRSLQLRQ

-- 2 of 8 --

%XUFKHWWHWDOY.LHIHUHWDO 1R
REVHUYHG%XUFKHWWEHLQJWDNHQLQWRFXVWRG\DQGKHREVHUYHG
%XUFKHWWLQWKHFUXLVHUVHYHUDOWLPHVRYHUDSHULRGRIKRXUV
%OLVV VDZ WKDW WKH ZLQGRZV RQ WKH FUXLVHU ZHUH XS %OLVV
WHVWLILHGWKDWLWZDV³H[WUHPHO\KRW´WKDWGD\-$DW %OLVV
'HS DQGWKDWWKHKHDWKDGIRUFHGKLPWRDEDQGRQKLVVHDUFK
RI WKH DWWLF VHYHUDO WLPHV *LYHQ WKH KHDW DQG %OLVV¶V
DZDUHQHVV RI WKH FRQGLWLRQV DQG OHQJWK RI %XUFKHWW¶V
GHWHQWLRQ WKHUH DUH JHQXLQH LVVXHV RI PDWHULDO IDFW ZLWK
UHVSHFWWR%OLVV¶VOLDELOLW\6LPLODUO\6KHULII*UHJ.LHIHUZDV
SUHVHQWZKHQWKHRIILFHUVGHWDLQHG%XUFKHWWLQWKHFUXLVHUDQG
ZKHQ%XUFKHWWZDVUHOHDVHGDQG.LHIHUVWDWHGWKDWKHVDZ
%XUFKHWW LQ WKH FUXLVHU VHYHUDO WLPHV GXULQJ WKH GHWHQWLRQ
$FFRUGLQJO\.LHIHUNQHZWKHOHQJWKRI%XUFKHWW¶VGHWHQWLRQ
LQWKHFDUDQGDUHDVRQDEOHRIILFHULQ.LHIHU¶VSODFHZRXOG
KDYHUHFRJQL]HGWKHGDQJHUDQGWKHYLRODWLRQ
7KH HYLGHQFH GRHV QRW VKRZ WKDW DQ\ RI WKH RWKHU
GHIHQGDQWVZHUHDZDUHRUVKRXOGKDYHEHHQDZDUHRIWKRVH
IDFWV 'HSXW\ 6KHULII 5 + &RSDV¶V FDU ZDV XVHG IRU WKH
GHWHQWLRQEXWWKHUHLVQRHYLGHQFHWKDWKHZDVDZDUHRIWKDW
IDFWOHWDORQHDZDUHRIWKHFRQGLWLRQVRI%XUFKHWW¶VGHWHQWLRQ
%&,$JHQW-RQ'R]HUNQHZRIWKHKHDWDVKHZDVLQWKHDWWLF
ZLWK$JHQW%OLVVEXWWKHUHLVQRHYLGHQFHLQWKHUHFRUGWKDWKH
NQHZ RI %XUFKHWW¶V GHWHQWLRQ %&, $JHQW 'HQQLV /RZH
WHVWLILHGWKDWKHVDZ%XUFKHWWLQWKHFUXLVHUEXWWKHUHLVQR
HYLGHQFHWKDWKHNQHZRIWKHOHQJWKRIWKHGHWHQWLRQDNH\
DVSHFWRIWKHGHWHQWLRQ¶VGDQJHURXVQHVV:HGRQRWILQGWKH
HYLGHQFHVXIILFLHQWWRLPSRVHOLDELOLW\RQ&RSDV'R]HURU
/RZH 7KHUH LV QR HYLGHQFH LQ WKH UHFRUG OLQNLQJ 'HSXW\
6KHULII 7RQ\ 5RELQVRQ RU %&, $JHQW :LOOLDP 0RUULV WR
%XUFKHWW¶VGHWHQWLRQ:HWKXVUHYHUVHWKHJUDQWRIVXPPDU\
MXGJPHQWZLWKUHVSHFWWR.LHIHUDQG%OLVVDQGZHDIILUPWKH
JUDQWRIVXPPDU\MXGJPHQWZLWK UHVSHFWWR&RSDV'R]HU
/RZH5RELQVRQDQG0RUULV
%7KH6L[WK$PHQGPHQW&ODLPV
%XUFKHWWDOVRDOOHJHVWKDWWKHRIILFHUV¶DFWLRQVYLRODWHGKLV
6L[WK $PHQGPHQW ULJKW WR EH LQIRUPHG RI WKH QDWXUH DQG
FDXVHRIWKHFKDUJHVDJDLQVWKLP$OWKRXJK%XUFKHWWGRHVQRW
1R %XUFKHWWHWDOY.LHIHUHWDO
KRXVHWRVHDUFKIRUGUXJV&KDUOHV%XUFKHWWZKROLYHGQH[W
GRRUVDZXQPDUNHGYHKLFOHVSXOOLQWRKLVEURWKHU¶VGULYHZD\
DQGKHZDONHGWRWKHHGJHRIWKHSURSHUW\OLQHEHWZHHQWKH
WZR KRXVHV IRU D EHWWHU YLHZ 7KH SDUWLHV DJUHH WKDW WKH
SURSHUW\ OLQH LV DSSUR[LPDWHO\ WZHQW\ILYH IHHW IURP HDFK
KRXVHDQGWKDWWKHWZRKRXVHVDUHWKXVDSSUR[LPDWHO\ILIW\
IHHWDSDUW%XUFKHWWVDZWKUHHLQGLYLGXDOVDOORIZKRPKH
GHVFULEHVDVZHDULQJEODFNFORWKHVZLWKQRLGHQWLILFDWLRQDQG
WZRRIZKRPKHGHVFULEHVDVZHDULQJPDVNVZDONDURXQGWKH
EDFN RI KLV EURWKHU¶V KRXVH ZLWK ZHDSRQV $FFRUGLQJ WR
%XUFKHWWRQHRIWKHLQGLYLGXDOV²DOORIZKRPWXUQHGRXWWR
EH%&,DJHQWV²\HOOHGDWKLPWRJHWRQWKHJURXQG
)HDULQJ IRU WKH VDIHW\ RI KLV EDE\ ZKR ZDV LQ D SRUFK
VZLQJQHDUE\%XUFKHWWWXUQHGDQGUDQRQWRKLVSRUFK7KH
RIILFHUVSXUVXHGKLPEHFDXVHLQ%&,$JHQW/RZH¶VZRUGV
³DV,VDZKLPVWDQGLQJWKHUHLQWKH\DUGKHKDGVRPHWKLQJLQ
KLVKDQGDQG,FRXOGVHHLWZDVVRPHWKLQJEODFNDQGORRNHG
OLNHLWZDVDZHDSRQDWWKHWLPH6RKHWXUQHGDQGUDQKH
ZDVOHDYLQJ>WKHEURWKHU¶V@SURSHUW\DQGZDVQ¶WREH\LQJP\
FRPPDQGWRJHWRQWKHJURXQG6R,JDYHFKDVHEHFDXVH,IHOW
KH ZDV D WKUHDW´ -RLQW $SSHQGL[ ³-$´ DW /RZH
'HS $FFRUGLQJWR%XUFKHWWDQGKLVZLIH&DUODWKHRIILFHUV
IROORZHGKLPRQWRWKHSRUFKDQGVHL]HGKLPMXVWDVKHZDV
UHDFKLQJIRUKLVEDE\&DUODWKHQFDPHRXWVLGHRQWRWKHSRUFK
DQGWRRNWKHEDE\IURPWKHVZLQJ$WWKLVSRLQW%XUFKHWWKDG
QRWKLQJ LQ KLV KDQGV WKH EODFN REMHFW WKDW ORRNHG OLNH D
ZHDSRQWXUQHGRXWWRKDYHEHHQ%XUFKHWW¶VVXQJODVVHVZKLFK
ZHUHQRZO\LQJRQWKHSRUFK
2WKHU RIILFHUV DUULYHG DQG WKH RIILFLDOV LPPHGLDWHO\
DWWHPSWHGWRKDQGFXII%XUFKHWW%XUFKHWWDGPLWVWRKDYLQJ
³>W@ZLVWHGDQGWXUQHGVRPH´ZKLOHEHLQJKDQGFXIIHG-$DW
%XUFKHWW'HS DQGKLVZLIHVWDWHGWKDWKHZDV³NLQGRI
MXPSLQJ DURXQG´ -$ DW &DUOD %XUFKHWW 'HS %&,
$JHQW%OLVVFODLPVWKDW%XUFKHWWNHSWRQHDUPRXWDQGZRXOG
QRW OHW WKH RIILFHUV EULQJ LW GRZQ 7KH RIILFHUV HYHQWXDOO\
VXFFHHGHG LQ KDQGFXIILQJ KLP DQG DFFRUGLQJ WR %XUFKHWW
WKH\EHJDQSXVKLQJKLPLQWKHGLUHFWLRQRIWKHSDWUROFDUDQG
RIIWKHSRUFKZKLFKKDVD³VWHSGRZQ´DQG%XUFKHWWIHOO

-- 3 of 8 --

%XUFKHWWHWDOY.LHIHUHWDO 1R
%&, $JHQW %OLVV WHVWLILHG WKDW WKH ZLQGRZV ZHUH UROOHG XS RQO\ DIWHU
%XUFKHWW EHJDQ VSLWWLQJ DW SDVVHUVE\ +RZHYHU IRU SXUSRVHV RI VXPPDU\
MXGJPHQW ZH DFFHSW %XUFKHWW¶V FODLP WKDW WKH ZLQGRZV ZHUH UROOHG XS
LPPHGLDWHO\ DQG WKDW KH GLG QRW VSLW RQ SDVVHUVE\
%XUFKHWW VWDWHG GXULQJ KLV GHSRVLWLRQ WKDW ZKLOH KH ZDV LQ WKH FDU
2IILFHU 0LFKDHO 0XVLF RI WKH &LW\ RI -DFNVRQ 3ROLFH 'HSDUWPHQW VDLG ³,
KRSH \RX EXUQ XS LQ WKDW *RG GDPQ FDU´ -$ DW %XUFKHWW 'HS
0XVLF LV DOVR DOOHJHG WR KDYH ERXQFHG WKH FDU XS DQG GRZQ E\ MXPSLQJ RQ
RU JUDEELQJ WKH IHQGHU %XUFKHWW DSSDUHQWO\ VWLSXODWHG WR WKH GLVPLVVDO RI
2IILFHU 0XVLF IURP WKH SUHVHQW ODZVXLW DQG KLV FRQGXFW LV QRW DW LVVXH RQ
DSSHDO
-$DW %XUFKHWW'HS +HZDVWKHQWDNHQDZD\DQGE\
KLVDFFRXQW³SXVKHGYHU\URXJKO\´LQWRDPDUNHG6KHULII¶V
'HSDUWPHQW SDWURO FDU WKDW KDG DUULYHG DIWHU WKH XQPDUNHG
FDUV-$DW
%XUFKHWWZDVNHSWKDQGFXIIHGDQGLQWKHSROLFHFDUIRUWKUHH
KRXUVZKLOHWKHVHDUFKZDVH[HFXWHG%\DOODFFRXQWVWKLV
ZDVDYHU\KRWGD\$OWKRXJKWKHLQFLGHQWEHJDQVRPHWLPH
DIWHULQWKHDIWHUQRRQ%XUFKHWWWHVWLILHGWKDWWKHRXWGRRU
WHPSHUDWXUHUHPDLQHGDWQLQHW\GHJUHHV7KHFDU¶VZLQGRZV
ZHUHLQLWLDOO\GRZQDQGWKHFDUZDVUXQQLQJEXWXSRQSODFLQJ
%XUFKHWWLQWKHFDUWKHRIILFHUVUROOHGXSWKHZLQGRZVDQG
WXUQHGRIIWKHFDU7KHDLUFRQGLWLRQHUUHPDLQHGRIIDQGWKH
ZLQGRZVXSIRUWKHWKUHHKRXUV%XUFKHWWVD\VWKDWKHDVNHG
WKHRIILFHUV³WRUROOWKHZLQGRZGRZQWRJHWVRPHDLU´EXW
WKH\WROGKLP³1RVKXW\RXUPRXWK´-$DW %XUFKHWW
'HS $WOHDVWWZRRIWKHRIILFHUVZHUHDZDUHRIWKHKHDWWKDW
GD\DV%&,$JHQW%OLVVWHVWLILHGWKDWZKLOHKHDQG%&,$JHQW
'R]HUZHUHH[HFXWLQJWKHVHDUFKZDUUDQWLQWKHDWWLFRIWKH
EURWKHU¶VUHVLGHQFHWKHWHPSHUDWXUHVEHFDPH³H[WUHPHO\KRW´
DQG WKH\ KDG WR VWHS RXWVLGH SHULRGLFDOO\ WR JHW VRPH DLU
-$DW %OLVV'HS %XUFKHWW¶VZLIHWHVWLILHGWKDWZKHQKH
ZDVHYHQWXDOO\OHWRXWRIWKHFDUKHZDV³VRSSLQJZHWIURP
VZHDW´-$DW &DUOD%XUFKHWW'HS
6KHULII.LHIHUZKRREVHUYHG%XUFKHWWLQWKHFDUGHVFULEHG
%XUFKHWWDVEHLQJ³JHQHUDOO\LQDUDJH´-$DW .LHIHU
'HS %&,$JHQW%OLVVWHVWLILHGWKDWKHVDZ%XUFKHWWWKUHHRU
1R %XUFKHWWHWDOY.LHIHUHWDO
:HDOVRFRQFOXGHWKDWXQGHUWKH6XSUHPH&RXUW¶VUHFHQW
JXLGDQFHLQ+RSHY3HO]HUWKLVULJKWZDVFOHDUO\HVWDEOLVKHG
IRUTXDOLILHGLPPXQLW\SXUSRVHV,Q+RSHWKH&RXUWPDGH
FOHDUWKDWDULJKWFDQEHFOHDUO\HVWDEOLVKHGHYHQLIWKHUHLVQR
FDVH LQYROYLQJ ³IXQGDPHQWDOO\ VLPLODU´ RU ³PDWHULDOO\
VLPLODU´ IDFWV 6HH 6 &W DW 5DWKHU D ULJKW LV
FOHDUO\ HVWDEOLVKHG ZKHQ ³>W@KH UHDVRQLQJ WKRXJK QRW WKH
KROGLQJ´ RI D SULRU FRXUW RI DSSHDOV GHFLVLRQ SXWV ODZ
HQIRUFHPHQWRIILFLDOVRQQRWLFHRUZKHQWKH³SUHPLVH´RIRQH
FDVH³KDVFOHDUDSSOLFDELOLW\´WRDVXEVHTXHQWVHWRIIDFWV6HH
LG DW +HUH WKLV VWDQGDUG LV PHW :H KDYH ORQJ
UHFRJQL]HGIRULQVWDQFHWKDWWKH)RXUWK$PHQGPHQWSHUPLWV
GHWHQWLRQ XVLQJ RQO\ ³WKH OHDVW LQWUXVLYH PHDQV UHDVRQDEO\
DYDLODEOH´8QLWHG6WDWHVY6DQGHUV)G WK
&LU TXRWDWLRQ RPLWWHG 6LPLODUO\ ZH KDYH
UHFRJQL]HGWKDW³FODLPVRIH[FHVVLYHIRUFHGRQRWQHFHVVDULO\
UHTXLUHDOOHJDWLRQVRIDVVDXOW´EXWUDWKHUFDQFRQVLVWRIWKH
SK\VLFDOVWUXFWXUHDQGFRQGLWLRQVRIWKHSODFHRIGHWHQWLRQ
&RUQZHOO Y 'DKOEHUJ )G WK &LU
UHMHFWLQJ)RXUWK$PHQGPHQWH[FHVVLYHIRUFHFODLPRQWKH
JURXQGVWKDWDFRQYLFWHGSULVRQHUFRXOGEULQJRQO\DQ(LJKWK
$PHQGPHQW H[FHVVLYH IRUFH FODLP EXW UHFRJQL]LQJ WKDW
³GHWHQWLRQRQWKHFROGPXGG\JURXQG´FRXOGFRQVWLWXWHFODLP
RIH[FHVVLYHIRUFH 7KHVHSUHPLVHVKDYHFOHDUDSSOLFDELOLW\
WR WKLV FDVH DQG WKH UHDVRQLQJ RI WKRVH FDVHV VKRXOG KDYH
DOHUWHG UHDVRQDEOH RIILFHUV WR WKH FRQVWLWXWLRQDO YLRODWLRQV
LQKHUHQWLQVXEMHFWLQJDGHWDLQHHWRH[FHVVLYHKHDW6HHDOVR
+RSH6&WDW KROGLQJWKDWKDQGFXIILQJLQPDWH
WRKLWFKLQJSRVWDQGWKXVFDXVLQJ³XQQHFHVVDU\H[SRVXUHWR
WKH KHDW RI WKH VXQ´ YLRODWHG FOHDUO\ HVWDEOLVKHG (LJKWK
$PHQGPHQWULJKW
:HPXVWWKXVLGHQWLI\WKRVHZKRVHPRWLRQVIRUVXPPDU\
MXGJPHQWVKRXOGKDYHEHHQGHQLHG%&,$JHQW3DXO%OLVVLV
VKRZQ WR KDYH EHHQ DZDUH RI WKH KHDW DQG WKH OHQJWK DQG
QDWXUHRI%XUFKHWW¶VFRQILQHPHQW7REHVXUH%OLVVGLGQRW
KLPVHOISODFH%XUFKHWWLQWKHFDULI%OLVVKDGSODFHG%XUFKHWW
LQWKHFDUDEVHQWHYLGHQFHWRWKHFRQWUDU\ZHPLJKWSUHVXPH
WKDW%OLVVVKRXOGKDYHUHPDLQHGDZDUHRIWKHFRQGLWLRQVRIWKH
GHWHQWLRQ WKURXJKRXW WKH LQYHVWLJDWLRQ +RZHYHU %OLVV

-- 4 of 8 --

%XUFKHWWHWDOY.LHIHUHWDO 1R
%XUFKHWWJDYH WKHPQRWLFHWKH\LPPHGLDWHO\DFWHG7KHLU
DFWLRQV KDQGFXIILQJ %XUFKHWW GLG QRW YLRODWH %XUFKHWW¶V
FRQVWLWXWLRQDOULJKWV
6HFRQG%XUFKHWWFODLPVWKDWKLVGHWHQWLRQLQWKHSROLFHFDU
ZLWKWKHZLQGRZVUROOHGXSLQQLQHW\GHJUHHKHDWIRUWKUHH
KRXUVFRQVWLWXWHGH[FHVVLYHIRUFH:HDJUHHWKDWXQQHFHVVDU\
GHWHQWLRQLQH[WUHPHWHPSHUDWXUHVOLNHWKRVHWKDWFRXOGEH
UHDFKHGLQDQXQYHQWLODWHGFDULQQLQHW\GHJUHHKHDWYLRODWHV
WKH )RXUWK $PHQGPHQW¶V SURKLELWLRQV RQ XQUHDVRQDEOH
VHDUFKHV DQG VHL]XUHV 7KH 6XSUHPH &RXUW KDV QRWHG WKDW
XQGHUFHUWDLQFLUFXPVWDQFHV³XQQHFHVVDU\H[SRVXUHWRWKHKHDW
RI WKH VXQ WR SURORQJHG WKLUVW DQG WDXQWLQJ DQG WR D
GHSULYDWLRQ RI EDWKURRP EUHDNV´ FDQ YLRODWH WKH (LJKWK
$PHQGPHQW¶V SURKLELWLRQ RQ ³XQQHFHVVDU\ DQG ZDQWRQ
LQIOLFWLRQRISDLQ´+RSH6&WDW6XFKDFWLRQVD
IRUWLRUL YLRODWH WKH )RXUWK $PHQGPHQW ZKLFK UHTXLUHV D
VKRZLQJ RI REMHFWLYH XQUHDVRQDEOHQHVV UDWKHU WKDQ DQ\
SDUWLFXODUVXEMHFWLYHPRWLYDWLRQ6HH*UDKDPY&RQQRU
86
)XUWKHUWKHJRYHUQPHQW¶VLQWHUHVWLQHIIHFWLQJWKHVHL]XUH
LQWKLVFDVHGLGQRWMXVWLI\WKHLPSRVLWLRQRIH[WUHPHKHDWRQ
WKH LQGLYLGXDO 7KH RIILFHUV KDG PDQ\ HTXDOO\ HIIHFWLYH
DOWHUQDWLYHZD\VRIGHWDLQLQJ%XUFKHWWWKDWZRXOGQRWKDYH
VXEMHFWHGKLPWRH[FHVVLYHKHDWEXWWKHLUGHQLDORIKLVUHTXHVW
WKDWWKH\UROOGRZQWKHZLQGRZVWRDOORZKLPDLULQGLFDWHVD
ZDQWRQ LQGLIIHUHQFH WR WKLV LPSRUWDQW VDIHW\ IDFWRU 7KH\
FRXOGKDYHOHIWWKHZLQGRZVVOLJKWO\RSHQIRUH[DPSOHRU
XWLOL]HG WKH FDU¶V FRROLQJ RU YHQWLODWLRQ GHYLFHV ,I WKH
GHWDLQHH GLG VSLW XSRQ RIILFHUV RU SDVVHUVE\ RU RWKHUZLVH
GLVUXSWHG WKH RIILFHUV¶ VHDUFK DQG WKH RIILFHUV FRXOG QRW
RWKHUZLVHHIIHFWLYHO\VHSDUDWHWKHGHWDLQHHIURPSDVVHUVE\
DUHDVRQDEOHRIILFHUPLJKWFRQFOXGHWKDWFORVLQJWKHZLQGRZV
ZDV QHFHVVDU\ 5HVROYLQJ IDFWXDO GLVSXWHV LQ %XUFKHWW¶V
IDYRUKRZHYHUWKRVHFLUFXPVWDQFHVZHUHQRWSUHVHQWKHUH
7KXV ZH FRQFOXGH WKDW WKRVH UHVSRQVLEOH IRU GHWDLQLQJ
%XUFKHWW IRU WKUHH KRXUV LQ QLQHW\GHJUHH KHDW ZLWK QR
YHQWLODWLRQ YLRODWHG KLV )RXUWK $PHQGPHQW ULJKW DJDLQVW
XQUHDVRQDEOHVHL]XUHV
1R %XUFKHWWHWDOY.LHIHUHWDO
IRXUWLPHVGXULQJWKDWSHULRGDQGWKDWKHRQFHWULHGWRFDOP
%XUFKHWWE\VSHDNLQJZLWKKLPLQWKHFDU7RZDUGWKHHQGRI
WKH WKUHH KRXUV 6KHULII .LHIHU DVNHG %XUFKHWW¶V ZLIH DQG
GDXJKWHUWRVSHDNZLWK%XUFKHWWDQGFDOPKLPGRZQ7KH
RIILFHUV RSHQHG WKH ZLQGRZ VOLJKWO\ IRU WKHP WR GR VR DW
ZKLFK SRLQW %XUFKHWW VKRZHG WKHP WKDW KLV KDQGV ZHUH
VZROOHQ DQG EOXH %XUFKHWW¶V GDXJKWHU SRLQWHG WKLV RXW WR
.LHIHU ZKR WROG %XUFKHWW WKDW KH ZRXOG EH UHOHDVHG LI KH
SURPLVHGWREHKDYH%XUFKHWWDJUHHGZDVOHWRXWRIWKHFDU
DQGZDVUHOHDVHGIURPWKHKDQGFXIIV%XUFKHWWZDVJLYHQD
FLWDWLRQ IRU GLVRUGHUO\ FRQGXFW EXW WKH FKDUJHV ZHUH ODWHU
GLVPLVVHG
%XUFKHWW FODLPV WKDW KH VXIIHUHG SK\VLFDO DQG HPRWLRQDO
LQMXULHVDVDUHVXOWRIKLVGHWHQWLRQ7KHGHWHQWLRQLQWKHKHDW
FDXVHG H[WUHPH GLVFRPIRUW DQG WKH KDQGFXIIV FDXVHG
VZHOOLQJDEUDVLRQVDQGWKUHHRUIRXUGD\VRIPLVVHGZRUN
+H IHDUV WKDW SROLFH ZLOO ³DWWDFN´ KLP DJDLQ DQG KLV ZLIH
VWDWHVWKDWKHKDVKDGQLJKWPDUHVVLQFHWKHQ%XUFKHWW¶VZLIH
DOVRVWDWHVWKDWVKHKDVH[SHULHQFHGPHQWDODQJXLVKDVDUHVXOW
RIWKHLQFLGHQW
%XUFKHWWDQGKLVZLIHILOHGWKLVODZVXLWRQ'HFHPEHU
DOOHJLQJYLRODWLRQVRIKLV)RXUWK$PHQGPHQWULJKWWREH
IUHH IURP XQUHDVRQDEOH VHDUFK DQG VHL]XUH KLV 6L[WK
$PHQGPHQWULJKWWREHLQIRUPHGRIWKHQDWXUHDQGFDXVHRI
WKH FKDUJHV DJDLQVW KLP DQG KLV )RXUWHHQWK $PHQGPHQW
ULJKWV WR HTXDO SURWHFWLRQ DQG QRW WR EH GHSULYHG RI OLIH
OLEHUW\RUSURSHUW\ZLWKRXWGXHSURFHVVRIODZ%XUFKHWWKDV
DGGHGDQGGURSSHGQXPHURXVGHIHQGDQWVVLQFHWKHFDVHZDV
ILUVWILOHGEXWDWWKHVXPPDU\MXGJPHQWVWDJHWKHIROORZLQJ
GHIHQGDQWVUHPDLQHG6KHULII*UHJ.LHIHU'HSXW\6KHULII5
+&RSDVDQG'HSXW\6KHULII7RQ\5RELQVRQRIWKH-DFNVRQ
&RXQW\ 6KHULII¶V 'HSDUWPHQW DV ZHOO DV %&, $JHQWV 3DXO
%OLVV-RQ'R]HU'HQQLV/RZHDQG:LOOLDP0RUULV
$OO GHIHQGDQWV PRYHG IRU DQG ZHUH JUDQWHG VXPPDU\
MXGJPHQW7KHGLVWULFWFRXUWQRWHGWKDWWKHGHIHQGDQWVFRXOG
EHHQWLWOHGWRTXDOLILHGLPPXQLW\EXWZLWKRXWUHDFKLQJWKH
TXHVWLRQ RI ZKHWKHU WKH ULJKWV DW LVVXH ZHUH FOHDUO\

-- 5 of 8 --

%XUFKHWWHWDOY.LHIHUHWDO 1R
HVWDEOLVKHGRUNQRZQE\UHDVRQDEOHSHRSOHWKHFRXUWUXOHG
WKDWQRFRQVWLWXWLRQDOYLRODWLRQVKDGRFFXUUHG%HFDXVHWKH
)RXUWK$PHQGPHQWGRHVQRWSURKLELWSROLFHIURPGHWDLQLQJ
LQGLYLGXDOVSUHVHQWGXULQJDVHDUFKLQRUGHUWRSUHYHQWIOLJKW
HQVXUH VDIHW\ DQG SURWHFW HYLGHQFH DQG WKH GLVWULFW FRXUW
IRXQG WKDW WKH GHWHQWLRQ RI %XUFKHWW ZDV UHDVRQDEOH LW
FRQFOXGHG WKDW QR )RXUWK $PHQGPHQW YLRODWLRQ RFFXUUHG
7KHGLVWULFWFRXUWDOVRDSSDUHQWO\LQWHUSUHWHG%XUFKHWW¶V6L[WK
$PHQGPHQW FODLP WR EH D FODLP UHJDUGLQJ KLV ULJKW WR
FRXQVHO %HFDXVH WKDW ULJKW GRHV QRW DWWDFK XQWLO WKH
EHJLQQLQJRIDGYHUVDULDOFULPLQDOSURFHHGLQJVWKHFRXUWUXOHG
WKDWQR6L[WK$PHQGPHQWULJKWZDVYLRODWHG
,,$1$/<6,6
:H UHYLHZ D GLVWULFW FRXUW V GHFLVLRQ JUDQWLQJ VXPPDU\
MXGJPHQWGHQRYR*HQ(OHF&RY*6LHPSHONDPS*PE+
&R )G WK &LU 6XPPDU\
MXGJPHQWLVSURSHURQO\LIWKHUHLVQRJHQXLQHLVVXHDVWRDQ\
PDWHULDOIDFWDQGWKHPRYLQJSDUW\LVHQWLWOHGWRDMXGJPHQWDV
DPDWWHURIODZ)HG5&LY3 F :HPXVWORRNEH\RQG
WKHSOHDGLQJVDQGPXVWDVVHVVWKHSURRIWRGHWHUPLQHZKHWKHU
WKHUHLVDJHQXLQHLVVXHIRUWULDO6HH0DWVXVKLWD(OHF,QGXV
&RY=HQLWK5DGLR&RUS86 7KH
SURSHU LQTXLU\ LV ZKHWKHU WKH HYLGHQFH LV VXFK WKDW D
UHDVRQDEOH MXU\ FRXOG UHWXUQ D YHUGLFW IRU WKH QRQPRYLQJ
SDUW\6HH$QGHUVRQY/LEHUW\/REE\,QF86
³5XOH F PDQGDWHV WKH HQWU\ RI VXPPDU\
MXGJPHQWDIWHUDGHTXDWHWLPHIRUGLVFRYHU\DQGXSRQPRWLRQ
DJDLQVW D SDUW\ ZKR IDLOV WR PDNH D VKRZLQJ VXIILFLHQW WR
HVWDEOLVKWKHH[LVWHQFHRIDQHOHPHQWHVVHQWLDOWRWKDWSDUW\ V
FDVHDQGRQZKLFKWKDWSDUW\ZLOOEHDUWKHEXUGHQRISURRIDW
WULDO´&HORWH[&RUSY&DWUHWW86 ,Q
FRQGXFWLQJWKHVXPPDU\MXGJPHQWDQDO\VLVZHPXVWYLHZDOO
LQIHUHQFHVWREHGUDZQIURPWKHXQGHUO\LQJIDFWVLQWKHOLJKW
PRVWIDYRUDEOHWRWKHQRQPRYLQJSDUW\6HH*HQ(OHF&R
)GDW
7KH %XUFKHWWV¶ FODLPV PXVW EH HYDOXDWHG XQGHU WKH
IUDPHZRUNRITXDOLILHGLPPXQLW\$FFRUGLQJWRWKHGRFWULQH
1R %XUFKHWWHWDOY.LHIHUHWDO
)LUVWZHFRQFOXGHWKDWWKHRIILFHUVGLGQRWXVHH[FHVVLYH
IRUFHLQKDQGFXIILQJ%XUFKHWW7KHRIILFHUVDGPLWWKDWWKH\
KDGWRXVHIRUFHLQUHVWUDLQLQJKLPEXW³>Q@RWHYHU\SXVKRU
VKRYHHYHQLILWPD\ODWHUVHHPXQQHFHVVDU\YLRODWHVWKH
)RXUWK$PHQGPHQW´*UDKDP86DW TXRWDWLRQ
RPLWWHG ,QIDFW%XUFKHWW¶VRZQVWDWHPHQWVLQGLFDWHWKDWWKH
LQLWLDOIRUFHXVHGWRUHVWUDLQKLPPD\KDYHEHHQQHFHVVDU\
%XUFKHWWDFNQRZOHGJHGWKDW KH³WZLVWHGDQGWXUQHGVRPH´
ZKHQ WKH\ WULHG WR KDQGFXII KLP DQG WKDW WKH RIILFHUV KDG
GLIILFXOW\UHVWUDLQLQJKLP-$DW %XUFKHWW'HS 7KHUH
LV QR JHQXLQH LVVXH ZLWK UHVSHFW WR WKHVH IDFWV DQG WKH
RIILFHUV¶XVHRIIRUFHZDVUHDVRQDEOH
7KHWLJKWQHVVRIWKHKDQGFXIIVWKHPVHOYHVFDXVHVJUHDWHU
FRQFHUQ 7KH ULJKW WR EH IUHH IURP ³H[FHVVLYHO\ IRUFHIXO
KDQGFXIILQJ´ LV D FOHDUO\ HVWDEOLVKHG ULJKW IRU TXDOLILHG
LPPXQLW\SXUSRVHV.RVWU]HZDY&LW\RI7UR\)G
WK&LU DQGDSSO\LQJKDQGFXIIVVRWLJKWO\WKDWWKH
GHWDLQHH¶VKDQGVEHFRPHQXPEDQGWXUQEOXHFHUWDLQO\UDLVHV
FRQFHUQV RI H[FHVVLYH IRUFH 2XU SUHFHGHQWV DOORZ WKH
SODLQWLII WR JHW WR D MXU\ XSRQ D VKRZLQJ WKDW RIILFHUV
KDQGFXIIHGWKHSODLQWLIIH[FHVVLYHO\DQGXQQHFHVVDULO\WLJKWO\
DQGLJQRUHGWKHSODLQWLII¶VSOHDVWKDWWKHKDQGFXIIVZHUHWRR
WLJKW 6HH LG 0DUWLQ Y +HLGHPDQ )G
WK&LU UHYHUVLQJGLUHFWHGYHUGLFWLQIDYRURI
GHIHQGDQWVRQH[FHVVLYHIRUFHFODLPZKHQSODLQWLII¶VKDQGV
ZHUHLQMXUHGDIWHUWKLUW\ILYHPLQXWHVLQWLJKWKDQGFXIIV
8QOLNHWKHRIILFHUVLQ.RVWU]HZDDQG0DUWLQKRZHYHUWKH
RIILFHUVKHUHGLGQRWLJQRUHDQ\SOHDWKDWWKHKDQGFXIIVZHUH
WRRWLJKW7RWKHFRQWUDU\%XUFKHWWFRPSODLQHGRQO\RQFH
DQGRQWKDWRFFDVLRQ6KHULII.LHIHULPPHGLDWHO\RIIHUHGWR
UHPRYHWKHKDQGFXIIVLI%XUFKHWWZRXOGEHKDYH%XUFKHWW
DJUHHGDQGWKHKDQGFXIIVZHUHUHPRYHG7KHUHFRUGJLYHVQR
LQGLFDWLRQWKDW%XUFKHWWKDGSUHYLRXVO\FRPSODLQHGRUDGYLVHG
WKHRIILFHUVWKDWWKHKDQGFXIIVZHUHWRRWLJKW.LHIHU¶VSURPSW
UHVSRQVHZKHQ%XUFKHWWILQDOO\GLGFRPSODLQGLVWLQJXLVKHV
WKLVFDVHIURPWKRVHLQZKLFKZHKDYHIRXQGFRQVWLWXWLRQDO
YLRODWLRQV8QWLOWKH\KDGQRWLFHWKDWWKHKDQGFXIIVZHUHWRR
WLJKW WKH RIILFHUV ZHUH XQDZDUH RI WKH SUREOHP 2QFH

-- 6 of 8 --

%XUFKHWWHWDOY.LHIHUHWDO 1R
LGHQWLILHG%XUFKHWW¶VSUHVHQFHRQWKHSURSHUW\OLQHDQGKLV
IOLJKW XSRQ HQFRXQWHULQJ WKH RIILFHUV ZRXOG VXJJHVW WR D
UHDVRQDEOHODZHQIRUFHPHQWRIILFLDOWKDWKHSRVHGDVLPLODU
ULVN RI IOLJKW DQG GDQJHU WR RWKHUV DV DQ LQGLYLGXDO ZKR
DUULYHGDWWKHSUHPLVHVGXULQJDVHDUFK6HH%RKDQQRQ
)GDW7KDWRIILFHUVDUULYHGDQGVRXJKWWRGHWDLQKLP
²LQWKHPRVWPLQLPDOVHQVHDWILUVWE\\HOOLQJIRUKLPWR
JHW GRZQ ² ZKLOH KH ZDV VWLOO RQH VWHS DZD\ IURP WKH
SURSHUW\OLQHVHHPVOLNHDQDUELWUDU\GLVWLQFWLRQWKDWZRXOG
XQGHUPLQHWKHSROLFLHVH[SUHVVHGLQ6XPPHUV
:H WKHUHIRUH FRQFOXGH WKDW WKH RIILFHUV¶ GHWHQWLRQ RI
%XUFKHWWGLGQRWYLRODWHKLV)RXUWK$PHQGPHQWULJKWV
7KH2IILFHUV¶8VHRI)RUFH$JDLQVW%XUFKHWW
&ODLPVUHJDUGLQJSROLFHRIILFHUV¶XVHRIH[FHVVLYHIRUFHLQ
WKHFRXUVHRIDQDUUHVWRURWKHUVHL]XUHDUHJRYHUQHGE\WKH
)RXUWK$PHQGPHQW6HH3KHOSVY&R\)G
WK&LU FLWLQJ*UDKDPY&RQQRU86
7KH)RXUWK$PHQGPHQWUHTXLUHVWKDWDQRIILFHU¶V
XVH RI IRUFH EH REMHFWLYHO\ UHDVRQDEOH DQG FRXUWV PXVW
EDODQFH WKH FRQVHTXHQFHV WR WKH LQGLYLGXDO DJDLQVW WKH
JRYHUQPHQW¶VLQWHUHVWVLQHIIHFWLQJWKHVHL]XUH6HH*UDKDP
86DW7KLVVWDQGDUGFRQWDLQVDEXLOWLQPHDVXUHRI
GHIHUHQFHWRWKHRIILFHU¶VRQWKHVSRWMXGJPHQWDERXWWKHOHYHO
RI IRUFH QHFHVVDU\ LQ OLJKW RI WKH FLUFXPVWDQFHV RI WKH
SDUWLFXODUFDVH6HHLG&RXUWVHYDOXDWLQJWKHUHDVRQDEOHQHVV
RIIRUFHXVHG³VKRXOGSD\SDUWLFXODUDWWHQWLRQWRμWKHVHYHULW\
RIWKHFULPHDWLVVXHZKHWKHUWKHVXVSHFWSRVHVDQLPPHGLDWH
WKUHDWWRWKHVDIHW\RIWKHRIILFHUVRURWKHUVDQGZKHWKHUKHLV
DFWLYHO\ UHVLVWLQJ DUUHVW RU DWWHPSWLQJ WR HYDGH DUUHVW E\
IOLJKW¶´'DUUDKY&LW\RI2DN3DUN)G WK
&LU TXRWLQJ*UDKDP86DW
4XHVWLRQV RI H[FHVVLYH IRUFH DULVH ZLWK UHVSHFW WR WKH
RIILFHUV¶KDQGFXIILQJRI%XUFKHWWDQGWKHLUGHWDLQLQJKLPIRU
WKUHHKRXUVLQDQXQYHQWLODWHGSROLFHFDULQH[WUHPHKHDW:H
WDNHWKHWZRLQWXUQ
1R %XUFKHWWHWDOY.LHIHUHWDO
RI TXDOLILHG LPPXQLW\ ³JRYHUQPHQW RIILFLDOV SHUIRUPLQJ
GLVFUHWLRQDU\IXQFWLRQVJHQHUDOO\DUHVKLHOGHGIURPOLDELOLW\
IRUFLYLOGDPDJHVLQVRIDUDVWKHLUFRQGXFWGRHVQRWYLRODWH
FOHDUO\HVWDEOLVKHGVWDWXWRU\RUFRQVWLWXWLRQDOULJKWVRIZKLFK
D UHDVRQDEOH SHUVRQ ZRXOG KDYH NQRZQ´ +DUORZ Y
)LW]JHUDOG86 4XDOLILHGLPPXQLW\
LQYROYHVDWZRVWHSLQTXLU\)LUVWWKHFRXUWPXVWGHWHUPLQH
ZKHWKHUEDVHGXSRQWKHDSSOLFDEOHODZWKHIDFWVYLHZHGLQ
WKH OLJKW PRVW IDYRUDEOH WR WKH SODLQWLIIV VKRZ WKDW D
FRQVWLWXWLRQDO YLRODWLRQ KDV RFFXUUHG ,I WKH FRXUW ILQGV D
FRQVWLWXWLRQDO YLRODWLRQ LW PXVW WKHQ FRQVLGHU ZKHWKHU WKH
YLRODWLRQLQYROYHV³μFOHDUO\HVWDEOLVKHGFRQVWLWXWLRQDOULJKWV
RI ZKLFK D UHDVRQDEOH SHUVRQ ZRXOG KDYH NQRZQ¶´
'LFNHUVRQY0F&OHOODQ)G WK&LU
TXRWLQJ&KULVWRSKHOY.XNXOLQVN\)G WK&LU
VHH DOVR 6DXFLHU Y .DW] 86
)RUDULJKWWREHFOHDUO\HVWDEOLVKHG³>W@KHFRQWRXUV
RIWKHULJKWPXVWEHVXIILFLHQWO\FOHDUWKDWDUHDVRQDEOHRIILFLDO
ZRXOGXQGHUVWDQGWKDWZKDWKHLVGRLQJYLRODWHVWKDWULJKW´
5XVVRY&LW\RI&LQFLQQDWL)G WK&LU
TXRWLQJ $QGHUVRQ Y &UHLJKWRQ 86
³$OWKRXJK LW QHHG QRW EH WKH FDVH WKDW μWKH YHU\
DFWLRQLQTXHVWLRQKDVEHHQSUHYLRXVO\KHOGXQODZIXOLQ
WKH OLJKW RI SUHH[LVWLQJ ODZ WKH XQODZIXOQHVV PXVW EH
DSSDUHQW¶´,G TXRWLQJ$QGHUVRQ86DW $VWKH
6XSUHPH &RXUW QRWHG LQ +RSH Y 3HO]HU BB 86 BB
6&W DQDFWLRQ¶VXQODZIXOQHVVFDQEH
DSSDUHQWIURPGLUHFWKROGLQJVVSHFLILFH[DPSOHVGHVFULEHGDV
SURKLELWHG RU IURP WKH JHQHUDO UHDVRQLQJ WKDW D FRXUW
HPSOR\V
$7KH)RXUWK$PHQGPHQW&ODLPV
7KH %XUFKHWWV DUJXH WKDW WKH RIILFHUV¶ EHKDYLRU YLRODWHG
&KDUOHV%XUFKHWW¶V)RXUWK$PHQGPHQWULJKWWREHIUHHIURP
DQXQUHDVRQDEOHVHDUFKDQGVHL]XUH7KHUHLVQRTXHVWLRQWKDW
%XUFKHWW¶V GHWHQWLRQ FRQVWLWXWHG D ³VHL]XUH´ ZLWKLQ WKH
PHDQLQJRIWKH)RXUWK$PHQGPHQW6HH7HUU\Y2KLR
86 ³>:@KHQHYHUDSROLFHRIILFHUDFFRVWVDQ
LQGLYLGXDO DQG UHVWUDLQV KLV IUHHGRP WR ZDON DZD\ KH KDV

-- 7 of 8 --

%XUFKHWWHWDOY.LHIHUHWDO 1R
μVHL]HG¶WKDWSHUVRQ´ %XUFKHWWDSSHDUVWRUDLVHWZR)RXUWK
$PHQGPHQWFODLPV)LUVWKHDUJXHVWKDWWKHRIILFHUVODFNHG
WKH SRZHU WR GHWDLQ KLP DW DOO 6HFRQG KH DUJXHV WKDW LQ
GHWDLQLQJ KLP WKH RIILFHUV XVHG DQ LPSHUPLVVLEOH OHYHO RI
IRUFH
7KH2IILFHUV¶3RZHUWR'HWDLQ%XUFKHWW
,Q0LFKLJDQY6XPPHUV86 WKH6XSUHPH
&RXUWUXOHGWKDW³DZDUUDQWWRVHDUFKIRUFRQWUDEDQGIRXQGHG
RQ SUREDEOH FDXVH LPSOLFLWO\ FDUULHV ZLWK LW WKH OLPLWHG
DXWKRULW\ WR GHWDLQ WKH RFFXSDQWV RI WKH SUHPLVHV ZKLOH D
SURSHUVHDUFKLVFRQGXFWHG´,GDW IRRWQRWHVRPLWWHG
,Q6XPPHUVSROLFHDSSURDFKLQJDKRXVHWRH[HFXWHDVHDUFK
ZDUUDQWVDZWKHRZQHURIWKHKRXVHOHDYLQJDQGGHWDLQHGKLP
IRUWKHGXUDWLRQRIWKHVHDUFK,GDW7KH&RXUWUHDVRQHG
WKDWVXFKDGHWHQWLRQZDVSHUPLVVLEOHHYHQZLWKRXWSUREDEOH
FDXVHEHFDXVHLQDVPXFKDVLWLQYROYHGDOLPLWHGGHWHQWLRQDW
WKHLQGLYLGXDO¶VRZQUHVLGHQFHLWZDVQRWYHU\LQWUXVLYHDQG
EHFDXVH VXFK D GHWHQWLRQ VHUYHG VHYHUDO LPSRUWDQW SROLFH
LQWHUHVWV 'HWDLQLQJ VXFK LQGLYLGXDOV SUHYHQWHG IOLJKW
PLQLPL]HG WKH ULVN RI KDUP WR RIILFHUV DQG RWKHUV DQG
IDFLOLWDWHGWKHRUGHUO\FRPSOHWLRQRIWKHVHDUFK6HHLGDW
6XPPHUV GHWHQWLRQ GRHV QRW UHTXLUH D ILQGLQJ RI
SUREDEOHFDXVH6HHLGDW
:HKDYHH[WHQGHGSROLFHRIILFHUV¶SRZHUVXQGHU6XPPHUV
LQWZRLPSRUWDQWUHVSHFWV)LUVWLQ8QLWHG6WDWHVY)RXQWDLQ
)G WK&LU FHUWGHQLHG86
DQGRYHUUXOHGRQRWKHUJURXQGV7UHSHOY5RDGZD\([SUHVV
,QF)G WK&LU WKLVFRXUWUXOHGWKDW
WKH6XSUHPH&RXUW¶VGLVFXVVLRQRI³RFFXSDQWV´LQ6XPPHUV
LQFOXGHGQRQUHVLGHQWVZKRDUHSUHVHQWDWWKHVFHQHRIDVHDUFK
ZKHQSROLFHDUULYH7KHFRXUWQRWHGWKDWWZRRIWKH6XPPHUV
IDFWRUV DSSOLHG HTXDOO\ WR QRQUHVLGHQWV ZKR DUH SUHVHQW
EHFDXVH DOORZLQJ SROLFH WR GHWDLQ VXFK LQGLYLGXDOV ZRXOG
IXUWKHU6XPPHUV¶VJRDOVRISUHYHQWLQJIOLJKWDQGPLQLPL]LQJ
WKHULVNWRRIILFHUV6HHLG
6HFRQGLQ8QLWHG6WDWHVY%RKDQQRQ)G
WK &LU ZH UXOHG WKDW RIILFHUV FRXOG DOVR GHWDLQ
1R %XUFKHWWHWDOY.LHIHUHWDO
LQGLYLGXDOVZKRDUULYHDWWKHVFHQHRIDVHDUFKHYHQLIWKH\
ZHUH QRW LQVLGH WKH UHVLGHQFH RU SUHVHQW ZKHQ SROLFH ILUVW
DUULYHG,Q%RKDQQRQRIILFHUVZHUHFRQFOXGLQJWKHLUVHDUFK
DQGOHDYLQJWKHVFHQHZKHQDFDUSXOOHGLQWRWKHGULYHZD\RI
WKHUHVLGHQFHDWLVVXHDQGWZRLQGLYLGXDOVZDONHGIURPWKHFDU
WRZDUGWKHUHVLGHQFH6HHLGDW7KHRIILFHUVDVNHGWKH
ILUVWRIWKHPIRULGHQWLILFDWLRQDQGZKHQWKHRWKHUHQJDJHGLQ
QHUYRXVEHKDYLRUSDWWHGGRZQWKHVHFRQGIRXQGGUXJVDQG
DUUHVWHG KLP 6HH LG 1RWLQJ WKDW WKH SROLFLHV XQGHUO\LQJ
6XPPHUV DQG )RXQWDLQ HVSHFLDOO\ RIILFHU VDIHW\ DSSOLHG
HTXDOO\ WR WKH GHWHQWLRQ RI LQGLYLGXDOV DUULYLQJ DW D VHDUFK
VFHQHWKHFRXUWUXOHGWKDWVXFKDGHWHQWLRQZDVQRWDYLRODWLRQ
RIWKH)RXUWK$PHQGPHQW6HHLGDWVHHDOVRLG FLWLQJ
%DNHU Y 0RQURH 7RZQVKLS )G G &LU
³$OWKRXJK6XPPHUVLWVHOIRQO\SHUWDLQVWRDUHVLGHQW
RIWKHKRXVHXQGHUVHDUFKLWIROORZVWKDWWKHSROLFHPD\VWRS
SHRSOHFRPLQJWRRUJRLQJIURPWKHKRXVHLISROLFHQHHGWR
DVFHUWDLQZKHWKHUWKH\OLYHWKHUH´
,QWKHSUHVHQWFDVH%XUFKHWWQHLWKHUZDVDUHVLGHQWRIWKH
VHDUFKHG SUHPLVHV QRU DUULYHG DW WKH VHDUFKHG SUHPLVHV
7DNHQLQWKHOLJKWPRVWIDYRUDEOHWRKLPWKHUHFRUGVKRZV
WKDW %XUFKHWW UHPDLQHG RQ KLV RZQ SURSHUW\ DW DOO WLPHV
$OWKRXJKKHDGPLWWHGO\ZDONHGWRZDUGVWKHSURSHUW\OLQH²
ZKLFKWKHSDUWLHVDJUHHZRXOGSODFHKLPMXVWWZHQW\ILYHIHHW
DZD\IURPKLVEURWKHU¶VKRXVH²LQRUGHUWRVHHZKDWZDV
JRLQJ RQ %XUFKHWW VWDWHV WKDW KH UHPDLQHG RQ KLV RZQ
SURSHUW\ ,QDVPXFK DV %RKDQQRQ LQYROYHG GHWDLQHHV ZKR
GURYH XS WKH GULYHZD\ SDUNHG QHDU WKH UHVLGHQFH¶V IURQW
SRUFKDQGZDONHGWRZDUGWKHUHVLGHQFHVHH%RKDQQRQ
)GDW%RKDQQRQGRHVQRWFRQWUROWKLVFDVH%XUFKHWW
QHYHU³DUULYHG´DWWKHVHDUFKHGSUHPLVHV
$OWKRXJKWKHRIILFHUVKHUHZHUHQRWZLWKLQWKHVWULFWOLPLWV
RI6XPPHUVZHKROGWKDWRIILFHUVDFWZLWKLQWKHLU6XPPHUV
SRZHUV ZKHQ WKH\ GHWDLQ DQ LQGLYLGXDO ZKR DSSURDFKHV D
SURSHUW\EHLQJVHDUFKHGSXUVXDQWWRDZDUUDQWSDXVHVDWWKH
SURSHUW\OLQHDQGIOHHVZKHQWKHRIILFHUVLQVWUXFWKLPWRJHW
GRZQ$OWKRXJKWKLVUHDFKHVEH\RQG6XPPHUV¶V³RFFXSDQWV´
ODQJXDJH LW LV FRQVLVWHQW ZLWK WKH SROLFLHV WKDW 6XPPHUV

-- 8 of 8 --

Continue your research in ChatGPT or Claude

Connect Omnilex to search the legal corpus from your AI assistant.