The AI workspace for legal professionals
- Legal research with access to more than 1 million sources
- Document automation
- Matter management
- Hosted in the EU and Switzerland
Try it free for 14 days (10 questions/day during trial)
The AI workspace for legal professionals
Try it free for 14 days (10 questions/day during trial)
01-5632•02a0418p.06
8QLWHG6WDWHVY5D\ERUQ 1R
,QP\RSLQLRQWKHUHLVRQO\RQHIDFWRUWKDWFDXVHVWKLVFDVH
WRIDOOZLWKLQWKH³XVHGLQFRPPHUFHRULQDQDFWLYLW\DIIHFWLQJ
FRPPHUFH´SDUWRIWKH-RQHVWHVW-RQHV86DW
7KDWIDFWRULVWKHXVHRIWKHFKXUFKEXLOGLQJWRUHFRUGVHUPRQV
IRU WKH H[SUHVV SXUSRVH RI EURDGFDVWLQJ WKH VHUPRQV RQ
FRPPHUFLDOUDGLRVWDWLRQVLQFOXGLQJDUDGLRVWDWLRQORFDWHGLQ
WKH VWDWH RI 0LVVLVVLSSL 5DGLR EURDGFDVWV VSHFLILFDOO\
WDUJHWHGWRUHDFKSHRSOHLQRWKHUVWDWHVUHSUHVHQWWRP\PLQG
FODVVLFDFWLYLWLHVDIIHFWLQJLQWHUVWDWHFRPPHUFH$VDUHVXOW
,EHOLHYHWKDWWKHOHDGRSLQLRQLVFRUUHFWLQFRQFOXGLQJWKDWD
UDWLRQDOMXU\FRXOGILQGWKDWWKHFKXUFKEXLOGLQJZDVXVHGLQ
DFWLYLWLHVDIIHFWLQJLQWHUVWDWHFRPPHUFH%XWIRUWKLVIDFWRU
KRZHYHU,ZRXOGKDYHEHHQLQFOLQHGWRDIILUPWKHMXGJPHQW
RIWKHGLVWULFWFRXUW
7KH +RQRUDEOH $UWKXU - 7DUQRZ 8QLWHG 6WDWHV 'LVWULFW -XGJH IRU
WKH (DVWHUQ 'LVWULFW RI 0LFKLJDQ VLWWLQJ E\ GHVLJQDWLRQ
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
81,7(' 67$7(6 2) $0(5,&$
3ODLQWLII$SSHOODQW
Y
*(5$/' 5$<%251
'HIHQGDQW$SSHOOHH
;!
1
1R
$SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
IRUWKH:HVWHUQ'LVWULFWRI7HQQHVVHHDW0HPSKLV
1R²%HUQLFH%'RQDOG'LVWULFW-XGJH
$UJXHG2FWREHU
'HFLGHGDQG)LOHG'HFHPEHU
%HIRUH0(55,77DQG*,/0$1&LUFXLW-XGJHV
7$512:'LVWULFW-XGJH
BBBBBBBBBBBBBBBBB
&2816(/
$5*8(' /LQGD ) 7KRPH 81,7(' 67$7(6
'(3$570(17 2) -867,&( :DVKLQJWRQ '& IRU
$SSHOODQW$&:KDUWRQ-U:+$5721 :+$5721
-- 1 of 6 --
8QLWHG6WDWHVY5D\ERUQ 1R
$662&,$7(6 0HPSKLV 7HQQHVVHH IRU $SSHOOHH
21 %5,() /LQGD ) 7KRPH 81,7(' 67$7(6
'(3$570(17 2) -867,&( :DVKLQJWRQ '& IRU
$SSHOODQW$&:KDUWRQ-U:+$5721 :+$5721
$662&,$7(60HPSKLV7HQQHVVHH-DPHV':LOVRQ
-DPHV5*DUWV-U+$55,66+(/721'81/$3&2%%
5<'(50HPSKLV7HQQHVVHHIRU$SSHOOHH
0(55,77-GHOLYHUHGWKHRSLQLRQRIWKHFRXUWLQZKLFK
7$512:'-MRLQHG*,/0$1- SS GHOLYHUHG
DVHSDUDWHFRQFXUULQJRSLQLRQ
BBBBBBBBBBBBBBBBB
23,1,21
BBBBBBBBBBBBBBBBB
0(55,77&LUFXLW-XGJH,QWKLVFDVHWKH8QLWHG6WDWHV
DSSHDOV WKH RUGHU GLVPLVVLQJ 'HIHQGDQW *HUDOG 5D\ERUQ¶V
LQGLFWPHQWIRUDUVRQXQGHU86& L 7KHGLVWULFW
FRXUWIRXQGWKDWLWODFNHGVXEMHFWPDWWHUMXULVGLFWLRQRYHUWKH
PDWWHU EHFDXVH LW FRQFOXGHG WKDW DV DSSOLHG WR WKH
FLUFXPVWDQFHV RI WKH FDVH L FRQVWLWXWHV DQ
XQFRQVWLWXWLRQDOH[WHQVLRQRI&RQJUHVV¶VFRPPHUFHSRZHU
7KH FRXUW EHOLHYHG LWV GHFLVLRQ ZDV FRPSHOOHG E\ WKH
GHFLVLRQVRIWKH6XSUHPH&RXUWLQ8QLWHG6WDWHVY0RUULVRQ
86 DQG-RQHVY8QLWHG6WDWHV86
7RWKHH[WHQWWKHGLVWULFWFRXUWGLVPLVVHGWKHDUVRQFRXQW
IRU ODFN RI VXEMHFW PDWWHU MXULVGLFWLRQ LWV FRQFOXVLRQ ZDV
HUURQHRXV7KHGLVWULFWFRXUWPLVFRQVWUXHGODQJXDJHIURPWKH
RSLQLRQRIWKLVFRXUWLQ8QLWHG6WDWHVY6KHUOLQ)G
WK&LU ,QWKDWFDVHWKLVFRXUWFRQWUDVWHG
L ZLWKWKH*XQ)UHH6FKRRO=RQHV$FWRIWKH
VWDWXWHDWLVVXHLQ8QLWHG6WDWHVY/RSH]86
QRWLQJWKDW³>X@QOLNHWKHXQFRQVWLWXWLRQDOVWDWXWHLQ/RSH]
86& L GRHVFRQWDLQDMXULVGLFWLRQDOHOHPHQWZKLFK
HQVXUHV WKURXJK SURSHU LQTXLU\ WKDW WKH DUVRQ LQ TXHVWLRQ
DIIHFWVLQWHUVWDWHFRPPHUFH´,G
1R 8QLWHG6WDWHVY5D\ERUQ
BBBBBBBBBBBBBBBBBBBBB
&21&855(1&(
BBBBBBBBBBBBBBBBBBBBB
521$/' /(( *,/0$1 &LUFXLW -XGJH FRQFXUULQJ ,
DJUHH ZLWK WKH OHDG RSLQLRQ WKDW WKLV LV D FDVH WKDW IDOOV
VRPHZKHUHEHWZHHQWKHIDFWVRIFDVHVOLNH8QLWHG6WDWHVY
7HUU\ )G WK &LU KROGLQJ WKDW WKH FKXUFK¶V
RSHUDWLRQ RI D GD\FDUH FHQWHU ZDV D VXIILFLHQW DFWLYLW\
DIIHFWLQJ LQWHUVWDWH FRPPHUFH WR VDWLVI\ WKH MXULVGLFWLRQDO
HOHPHQWRI86& L FHUWGHQLHG6&W
DQGRIFDVHVOLNH8QLWHG6WDWHVY2GRP)G
WK&LU KROGLQJWKDWGRQDWLRQVIURPWZRRXW
RIVWDWHUHVLGHQWVSXUFKDVHVRI%LEOHVDQGSUD\HUERRNVIURP
DQRXWRIVWDWHVRXUFHDQGLQGLUHFWFRQWULEXWLRQVWRDQRXWRI
VWDWHFKXUFKRUJDQL]DWLRQZHUHLQVXIILFLHQWWRHVWDEOLVKWKDW
WKH FKXUFK¶V DFWLYLWLHV DIIHFWHG LQWHUVWDWH FRPPHUFH FHUW
GHQLHG6&W
$OWKRXJK,FRQFXULQWKHUHVXOWUHDFKHG,ZULWHVHSDUDWHO\
EHFDXVH,EHOLHYHWKDWWKHOHDGRSLQLRQRYHUVWDWHVWKHIDFWRUV
WKDWFDXVHWKLVFDVHWRIDOOZLWKLQWKHDPELWRI L ,Q
SDUWLFXODU WKH OHDG RSLQLRQ UHOLHV RQ IDFWRUV VXFK DV WKH
FKXUFKKDYLQJRXWRIVWDWHPHPEHUVVHUYLQJDVWKHVLWHIRU
JRVSHOFRQFHUWVWKDWRFFDVLRQDOO\IHDWXUHRXWRIVWDWHWDOHQW
HPSOR\LQJWZRSHUVRQVFROOHFWLQJGRQDWLRQVGXULQJ6XQGD\
VHUYLFHVSXUFKDVLQJIRRGDQGIORZHUVIRUIXQHUDOVSXUFKDVLQJ
JURFHULHV IRU FKXUFK EUHDNIDVWV DQG SLFQLFV DQG RZQLQJ
VHYHUDO YHKLFOHV /HDG 2S DW 7KHVH DUH WKH NLQGV RI
³SDVVLYH>RU@SDVVLQJ´DFWLYLWLHVWKDWERWKWKH6XSUHPH&RXUW
DQGRWKHUFLUFXLWVKDYHKHOGDUHLQVXIILFLHQWWREULQJDQDUVRQ
FDVHXQGHU L -RQHVY8QLWHG6WDWHV86
VHH HJ 2GRP )G DW ³7KHVH
FRQQHFWLRQV WR LQWHUVWDWH FRPPHUFH DUH WRR SDVVLYH WRR
PLQLPDO DQG WRR LQGLUHFW WR VXEVWDQWLDOO\ DIIHFW LQWHUVWDWH
FRPPHUFH´ LQWHUQDO TXRWDWLRQ PDUNV RPLWWHG ,I VXFK
DFWLYLWLHVDUHGHHPHGVXIILFLHQWWRVDWLVI\WKHMXULVGLFWLRQDO
HOHPHQW RI L WKHQ YLUWXDOO\ HYHU\ FKXUFK DUVRQ LQ
$PHULFDZLOOEHFRPHDIHGHUDORIIHQVH
-- 2 of 6 --
8QLWHG6WDWHVY5D\ERUQ 1R
LQWURGXFHGHYLGHQFHRIWKHFKXUFKEXLOGLQJ¶VGLUHFWUHJXODU
DQGVXEVWDQWLDOXVHLQDFWLYLWLHVDIIHFWLQJLQWHUVWDWHFRPPHUFH
:HFDQQRWVD\WKDWWKHHYLGHQFHSURGXFHGE\WKHJRYHUQPHQW
LV QRW VXIILFLHQW WR SHUPLW D UDWLRQDO MXU\ WR ILQG WKDW WKH
FKXUFK ZDV DFWLYHO\ HPSOR\HG LQ FRPPHUFLDO DFWLYLWLHV
DIIHFWLQJLQWHUVWDWHFRPPHUFH,QGHHGZKLOHZHEHOLHYHWKH
SDUWLHVKDYHVWLSXODWHGWRIDFWVWKDWFRXOGOHDGDWULHURIIDFWWR
FRQFOXGHWKHFKXUFKZDVXVHGLQDFWLYLWLHVDIIHFWLQJLQWHUVWDWH
FRPPHUFH WKH JRYHUQPHQW KDV LQGLFDWHG WKDW LW LQWHQGV WR
GHYHORSWKHUHFRUGIXUWKHURQWKLVSRLQW7KHGLVWULFWFRXUW¶V
RUGHUGLVPLVVLQJWKHGHIHQGDQW¶VLQGLFWPHQWIRUDUVRQXQGHU
86& L LV5(9(56('
1R 8QLWHG6WDWHVY5D\ERUQ
6HFWLRQ L SURYLGHV FULPLQDO SHQDOWLHV IRU ³>Z@KRHYHU
PDOLFLRXVO\ GDPDJHV RU GHVWUR\V RU DWWHPSWV WR GDPDJH RU GHVWUR\ E\
PHDQV RI ILUH RU DQ H[SORVLYH DQ\ EXLOGLQJ YHKLFOH RU RWKHU UHDO RU
SHUVRQDO SURSHUW\ XVHG LQ LQWHUVWDWH RU IRUHLJQ FRPPHUFH RU LQ DQ\ DFWLYLW\
DIIHFWLQJ LQWHUVWDWH RU IRUHLJQ FRPPHUFH´
$OWKRXJKWKHLQWHUVWDWHFRPPHUFHUHTXLUHPHQWLVIUHTXHQWO\
FDOOHG WKH ³MXULVGLFWLRQDO HOHPHQW´ LW LV VLPSO\ RQH RI WKH
HVVHQWLDOHOHPHQWVRI L ,WLVQRWMXULVGLFWLRQDOLQWKH
VHQVHWKDWLWDIIHFWVDFRXUW¶VVXEMHFWPDWWHUMXULVGLFWLRQLH
DFRXUW VFRQVWLWXWLRQDORUVWDWXWRU\SRZHUWRDGMXGLFDWHDFDVH
6HH8QLWHG6WDWHVY0DUWLQ)G WK&LU
FLWDWLRQV RPLWWHG 8QLWHG 6WDWHV Y 5HD )G
WK&LU YDFDWHGDQGUHPDQGHGRQRWKHU
JURXQGV )G WK &LU ³6HFWLRQ L ¶V
μLQWHUVWDWH FRPPHUFH¶ UHTXLUHPHQW ZKLOH MXULVGLFWLRQDO LQ
QDWXUHLVPHUHO\DQHOHPHQWRIWKHRIIHQVHQRWDSUHUHTXLVLWH
WRVXEMHFWPDWWHUMXULVGLFWLRQ´ 8QLWHG6WDWHVY&DUU
)G WK&LU .
$OWKRXJK WKLV FRXUW W\SLFDOO\ YDFDWHV D GLVPLVVDO RUGHU
ZKHQLWGHWHUPLQHVWKDWDGLVWULFWFRXUWKDVHUUHGLQGLVPLVVLQJ
DFDVHIRUODFNRIVXEMHFWPDWWHUMXULVGLFWLRQWKHGLVWULFWFRXUW
LQ WKLV FDVH XQGHUWRRN DQ HYDOXDWLRQ RI WKH PHULWV RI WKH
LQWHUVWDWH FRPPHUFH TXHVWLRQ XQGHU WKH JXLVH RI VXEMHFW
PDWWHU MXULVGLFWLRQ )XUWKHUPRUH WKH IDFWV DUH EHIRUH WKH
FRXUWYLDVWLSXODWLRQDQGWKHHYLGHQWLDU\KHDULQJLQWKHFRXUW
EHORZ:HWKHUHIRUHZLOOXQGHUWDNHDIXUWKHUFRQVLGHUDWLRQRI
WKHLQWHUVWDWHFRPPHUFHUHTXLUHPHQW
'HIHQGDQW *HUDOG 5D\ERUQ LV WKH SDVWRU RI 1HZ 0RXQW
6LQDL0LVVLRQDU\%DSWLVW&KXUFKLQ0HPSKLV7HQQHVVHH2Q
$XJXVWWKHFKXUFKEXLOGLQJZDVGHVWUR\HGE\ILUH
2Q'HFHPEHU5D\ERUQZDVLQGLFWHGLQFRQQHFWLRQ
ZLWKWKHDUVRQ&RXQWRIWKHLQGLFWPHQWFKDUJHGDYLRODWLRQ
RI86& L &RXQWVDQGFKDUJHGYLRODWLRQVRI
86& PDLOIUDXG 7KHLQGLFWPHQWDOOHJHGWKDW
5D\ERUQ KDG VHW ILUH WR WKH FKXUFK EXLOGLQJ DV SDUW RI D
VFKHPH WR GHIUDXG WKH LQVXUDQFH FRPSDQ\ WKDW KHOG WKH
FDVXDOW\SROLF\RQWKHFKXUFKEXLOGLQJ
-- 3 of 6 --
8QLWHG6WDWHVY5D\ERUQ 1R
,Q KLV PRWLRQ WR GLVPLVV WKH L FRXQW RI WKH
LQGLFWPHQW 5D\ERUQ DUJXHG WKDW WKH LQGLFWPHQW ZDV
GHIHFWLYH EHFDXVH WKH FKXUFK EXLOGLQJ ZDV QRW XVHG LQ
LQWHUVWDWH FRPPHUFH RU LQ DQ DFWLYLW\ DIIHFWLQJ LQWHUVWDWH
FRPPHUFHDQG WKDW&RQJUHVVKDGH[FHHGHGLWVDXWKRULW\LQ
HQDFWLQJ VHFWLRQ L 8SRQ UHFRPPHQGDWLRQ RI WKH
PDJLVWUDWHMXGJHWKHGLVWULFWFRXUWLQLWLDOO\GHQLHGWKHPRWLRQ
ILQGLQJWKDWZKHWKHUWKHHYLGHQFHZDVVXIILFLHQWWRHVWDEOLVK
WKHLQWHUVWDWHFRPPHUFHHOHPHQWRIWKHRIIHQVHZDVDPDWWHU
WREHGHWHUPLQHGDIWHUWKHSUHVHQWDWLRQRIHYLGHQFHDWWULDO
7KH GHIHQGDQW ILOHG D PRWLRQ WR UHFRQVLGHU DQG XSRQ
UHFRQVLGHUDWLRQWKHGLVWULFWFRXUWGLVPLVVHGWKH L FRXQW
RQWKHMXULVGLFWLRQDOJURXQGGLVFXVVHGDERYH
1H[WWKH*RYHUQPHQWILOHGDPRWLRQWRUHFRQVLGHUDQGD
PRWLRQIRUDQHYLGHQWLDU\KHDULQJWRHVWDEOLVKWKHUHTXLVLWH
FRQQHFWLRQ WR LQWHUVWDWH FRPPHUFH 7KH FRXUW JUDQWHG WKH
PRWLRQ IRU DQ HYLGHQWLDU\ KHDULQJ ZKLFK ZDV KHOG RQ
)HEUXDU\2Q$SULOWKHGLVWULFWFRXUWGHQLHG
WKH JRYHUQPHQW¶V PRWLRQ IRU UHFRQVLGHUDWLRQ DQG WKH
JRYHUQPHQWDSSHDOVIURPWKDWRUGHU
'HIHQGDQW5D\ERUQXUJHVXVWRDIILUPWKHGLVPLVVDORIWKH
DUVRQFRXQWIURPKLVLQGLFWPHQW+HFRQWHQGVWKDWEHFDXVH
WKH FKXUFK ZDV QRW DFWLYHO\ HPSOR\HG IRU D FRPPHUFLDO
SXUSRVH L GRHV QRW DSSO\ WR WKH SUHVHQW FDVH
'HIHQGDQW GRHV QRW DUJXH WKDW FKXUFKHV VKRXOG QHYHU EH
SHUPLWWHGWRIDOOZLWKLQWKHVWDWXWH¶VDPELW,QVWHDG5D\ERUQ
DUJXHV WKDW WR ILQG WKDW WKLV FKXUFK¶V DFWLYLWLHV LQYRNH WKH
SURYLVLRQV RI WKH VWDWXWH ZRXOG LPSHUPLVVLEO\ H[WHQG WKH
VFRSHRI L
,Q -RQHV Y 8QLWHG 6WDWHV WKH 6XSUHPH &RXUW KHOG WKDW
L GLGQRWUHDFKWKHDUVRQRIDQRZQHURFFXSLHGSULYDWH
UHVLGHQFH86 7KH&RXUWVWDWHGWKDW
WKHTXDOLI\LQJZRUGV³XVHGLQ´VLJQDOHG&RQJUHVV¶VLQWHQWQRW
³WRLQYRNHLWVIXOODXWKRULW\XQGHUWKH&RPPHUFH&ODXVH´,G
DW7KHSUHVHQFHRIDMXULVGLFWLRQDOHOHPHQWLQ L
HQDEOHG WKH &RXUW LQ -RQHV WR DYRLG WKH FRQVWLWXWLRQDO
1R 8QLWHG6WDWHVY5D\ERUQ
DFODLPRIPRUHWKDQWRWKHFKXUFK)G
WK&LU
,QDGGLWLRQLQ8QLWHG6WDWHVY2GRP)G WK
&LU WKHRQO\HYLGHQFHLQWURGXFHGWRGHPRQVWUDWHXVH
LQ LQWHUVWDWH FRPPHUFH LQFOXGHG WKH FKXUFK UHFHLYHG
GRQDWLRQV IURP WZR RXWRIVWDWH GRQRUV UHODWLYHV RI WKH
SDVWRU XVHRI³D KDQGIXO´RI%LEOHVDQGSUD\HUERRNV
SXUFKDVHG IURP DQ RXWRIVWDWH VRXUFH DQG LQGLUHFW
FRQWULEXWLRQVWRDQRXWRIVWDWHFKXUFKRUJDQL]DWLRQWKURXJK
LWVPHPEHUVKLSLQWKHLQVWDWHFKXUFKRUJDQL]DWLRQ6HHLGDW
2QWKRVHIDFWVWKH(OHYHQWK&LUFXLWFRQFOXGHGWKDW
WKHJRYHUQPHQWIDLOHGWRGHPRQVWUDWHWKDWWKHFKXUFKEXLOGLQJ
ZDVXVHGLQRUDIIHFWHGLQWHUVWDWHFRPPHUFH6HHLGDW
)LQDOO\WKH)RXUWK&LUFXLWLQ8QLWHG6WDWHVY7HUU\
)G WK&LU FRQVLGHUHGZKHWKHUWKHIROORZLQJ
IDFWVFRQVWLWXWHGVXIILFLHQWHYLGHQFHRIDFKXUFKEXLOGLQJ¶V
XVHLQRUHIIHFWRQFRPPHUFHRXWRIVWDWHPHPEHUVFKXUFK
HPSOR\HHVZKRUHFHLYHZDJHVIRUWKHLUHIIRUWVWKHFKXUFK¶V
DIILOLDWLRQZLWKWKH&RRSHUDWLYH%DSWLVW)HOORZVKLSZKLFKZDV
EDVHG LQ DQRWKHU VWDWH WKH FKXUFK¶V VSRQVRUVKLS RI
LQWHUQDWLRQDO PLVVLRQV WKH FKXUFK¶V SXUFKDVH RI 6XQGD\
6FKRRO PDWHULDOV IURP DQ RXWRIVWDWH VXSSOLHU DQG WKH
FKXUFK¶V UHIXUELVKPHQW RI KRPHV IURP ZKLFK LW FRXOG
UHDVRQDEO\ EH LQIHUUHG WKDW WKH FKXUFK SXUFKDVHG EXLOGLQJ
PDWHULDOVWKDWLPSDFWHGWKHQDWLRQDOPDUNHWIRUVXFKJRRGV
DQG VHUYLFHV 7KH )RXUWK &LUFXLW IRXQG LW XQQHFHVVDU\ WR
UHDFK WKDW LVVXH EHFDXVH LW FRQFOXGHG WKDW WKH FKXUFK¶V
RSHUDWLRQRIDIXOOGD\FDUHFHQWHUQHFHVVLWDWHGDILQGLQJWKDW
WKHLQWHUVWDWHFRPPHUFHUHTXLUHPHQWZDVPHW6HHLGDW
$IWHUUHYLHZLQJWKHIRUHJRLQJFDVHODZZHDUHFRQYLQFHG
WKDW WKH IDFWV VR IDU GHYHORSHG LQ WKH FDVH DW EDU IDOO
VRPHZKHUHEHWZHHQWKHIDFWVSUHVHQWHGWRWKH)LIWK&LUFXLWLQ
-RKQVRQDQGWKH(OHYHQWK&LUFXLWLQ2GRPRQWKHRQHKDQG
DQGWKH)RXUWK&LUFXLWLQ7HUU\RQWKHRWKHUKDQG:KLOHWKH
FRXUWV LQ -RKQVRQ DQG 2GRP ZHUH SUHVHQWHG ZLWK IDFWV
LQGLFDWLQJ³PHUHO\DSDVVLYHSDVVLQJRUSDVWFRQQHFWLRQWR
FRPPHUFH´-RQHV86DWKHUHWKHJRYHUQPHQWKDV
-- 4 of 6 --
8QLWHG6WDWHVY5D\ERUQ 1R
SXEOLFZDVLQYLWHG,WVHUYHGDVWKHVLWHRIJRVSHOFRQFHUWV
LQFOXGLQJ VRPH IHDWXULQJ RXWRIVWDWH WDOHQW IRU ZKLFK WKH
FKXUFKUHTXHVWHGGRQDWLRQVRIWR
)XUWKHUPRUHXQOLNHWKHSULYDWHKRPHLQ-RQHVWKHFKXUFK
EXLOGLQJZDVRZQHGE\DWD[H[HPSWQRQSURILWRUJDQL]DWLRQ
ZLWKD%RDUGRI7UXVWHHV,QDGGLWLRQWKHFKXUFKHPSOR\HG
WZRSHUVRQVDQGFROOHFWHGVXEVWDQWLDOVXPVRQDZHHNO\EDVLV
DSSUR[LPDWHO\WR7KHVHIXQGVZHUHUHFHLYHG
IURPUHVLGHQWVRI7HQQHVVHH0LVVLVVLSSLDQG$UNDQVDVDV
ZHOODVRWKHUVWDWHV
7KHFKXUFKDOVRHQJDJHGLQVXEVWDQWLDODFWLYLWLHVLQWKHORFDO
PDUNHWIRUJRRGV)RUH[DPSOHWKHFKXUFKVSHQWRQ
IRRGDQGIORZHUVIRUIXQHUDOVLQDVZHOODVIRU
JURFHULHV WR EH XVHG WR KRVW LWV SLFQLFV DQG EUHDNIDVWV ,Q
DGGLWLRQWKHFKXUFKRZQHGVHYHUDOYHKLFOHVLQFOXGLQJDFDU
DWUXFNDQGDUHFUHDWLRQDOYHKLFOH
:KHQWKHVHIDFWVDUHWDNHQWRJHWKHUZHFRQFOXGHWKDWWKH
JRYHUQPHQW KDV SURYLGHG VXIILFLHQW HYLGHQFH WR SHUPLW D
UDWLRQDOMXU\WRILQGWKDWWKHFKXUFKZDVDFWLYHO\HPSOR\HGLQ
FRPPHUFLDODFWLYLWLHVZLWKDQHIIHFWRQLQWHUVWDWHFRPPHUFH
:KLOHVHYHUDOFLUFXLWVKDYHGHWHUPLQHGWKDWXVHRIDEXLOGLQJ
DV D FKXUFK DORQH GRHV QRW TXDOLI\ LW DV EHLQJ ³XVHG LQ´
LQWHUVWDWH FRPPHUFH ZH GR QRW EHOLHYH WKDW ILQGLQJ WKDW
LQWHUVWDWH FRPPHUFH LV PHW RQ WKHVH IDFWV ZRXOG FUHDWH D
FLUFXLW VSOLW DV WKH GHIHQGDQW DVVHUWV 7KH FDVHV FLWHG E\
5D\ERUQ LQYROYHG IDFWXDO FLUFXPVWDQFHV IDU GLIIHUHQW IURP
WKRVH EHIRUH WKLV FRXUW )RU LQVWDQFH LQ 8QLWHG 6WDWHV Y
-RKQVRQWKH)LIWK&LUFXLWFRQFOXGHGWKDWDFKXUFKZDVQRWD
EXLOGLQJXVHGLQRUDIIHFWLQJLQWHUVWDWHFRPPHUFHZKHQWKH
JRYHUQPHQWDVVHUWHGWKHIROORZLQJIRXUIDFWV WKHFKXUFK¶V
PHPEHUVKLSLQWKH7H[DV$QQXDO&RQIHUHQFH VWDWH0HWKRGLVW
RUJDQL]DWLRQ WKH&RQIHUHQFH¶VIRUZDUGLQJRIWKRVHIXQGV
WRWKH8QLWHG0HWKRGLVW&KXUFK¶VQDWLRQDORIILFHLQ,OOLQRLV
WKHQDWLRQDORUJDQL]DWLRQ¶VGLVWULEXWLRQRIWKRVHIXQGVWR
YDULRXVPLVVLRQDU\DFWLYLWLHVVHPLQDULHVDQGLQVWLWXWLRQVRI
KLJKHUHGXFDWLRQDQG DQRXWRIVWDWHLQVXUHU¶VSD\PHQWRI
1R 8QLWHG6WDWHVY5D\ERUQ
&RPPHUFH&ODXVHDQDO\VLVPDQGDWHGE\/RSH]6HHLGDW
-RQHVHVWDEOLVKHGDWZRSDUWLQTXLU\WRGHWHUPLQHZKHWKHU
DEXLOGLQJILWVZLWKLQWKHVWULFWXUHVRI L )LUVWFRXUWV
PXVWLQTXLUH³LQWRWKHIXQFWLRQRIWKHEXLOGLQJLWVHOI´,GDW
6HFRQGFRXUWVVKRXOGGHWHUPLQHZKHWKHUWKDWIXQFWLRQ
³DIIHFWVLQWHUVWDWHFRPPHUFH´,G%HFDXVH L GRHVQRW
LQYRNH&RQJUHVV¶VIXOODXWKRULW\XQGHUWKH&RPPHUFH&ODXVH
WKH &RXUW H[SODLQHG WKDW WKH TXDOLILFDWLRQ ³μXVHG¶ LQ DQ
DFWLYLW\DIIHFWLQJFRPPHUFH´LV³PRVWVHQVLEO\UHDGWRPHDQ
DFWLYHHPSOR\PHQWIRUFRPPHUFLDOSXUSRVHVDQGQRWPHUHO\
DSDVVLYHSDVVLQJRUSDVWFRQQHFWLRQWRFRPPHUFH´,GDW
$VDUHVXOWWKH&RXUWFRQFOXGHGWKDWWKHIDFWVDVVHUWHG
E\WKHJRYHUQPHQW±XVHRIWKHGZHOOLQJDVFROODWHUDOIRUD
PRUWJDJHIURPDQRXWRIVWDWHOHQGHUWKHXVHRIWKHGZHOOLQJ
WRREWDLQDQRXWRIVWDWHLQVXUDQFHSROLF\DQGWKHXVHRIWKH
GZHOOLQJWRUHFHLYHQDWXUDOJDVIURPVRXUFHVRXWVLGHWKHVWDWH
± ZRXOG QRW EULQJ WKH SULYDWH KRPH ZLWKLQ WKH WHUPV RI
L 6HHLG
,Q -RQHV WKH &RXUW DOVR UHFRJQL]HG WKDW WKH OHJLVODWLRQ
XOWLPDWHO\ HQDFWHG DV L LQLWLDOO\ UHTXLUHG WKDW WKH
EXLOGLQJEHXVHG³IRUEXVLQHVVSXUSRVHV´EXWWKHTXDOLILHU
ZDVGHOHWHGLQUHVSRQVHWRPHPEHUVZKREHOLHYHGWKHVWDWXWH
VKRXOG SURWHFW ³VFKRROV SROLFH VWDWLRQV DQG SODFHV RI
ZRUVKLS´,GDWQ FLWLQJ5XVVHOOY8QLWHG6WDWHV
86 :KLOH L H[FOXGHVQR
SDUWLFXODU W\SH RI EXLOGLQJ WKH SURSHUW\ PXVW EH ³DFWLYHO\
HPSOR\>HG@IRUFRPPHUFLDOSXUSRVHV´,G
)RU SXUSRVHV RI WKH IXQFWLRQ DQDO\VLV WKH EXLOGLQJ¶V
IXQFWLRQLVQRWOLPLWHGWRLWVSULPDU\XVH1XPHURXVFRXUW
GHFLVLRQVVXSSRUWWKHLGHDWKDWDEXLOGLQJFDQKDYHPRUHWKDQ
RQH IXQFWLRQ )RU H[DPSOH LQ -RQHV WKH 6XSUHPH &RXUW
QRWHGWZLFHWKDWWKHSULYDWHKRPHDWLVVXHLQWKDWFDVHZDV
XVHGRQO\DVDUHVLGHQFHDQGQRWDOVRDVDKRPHRIILFHRULQ
VRPH RWKHU FRPPHUFLDO HQWHUSULVH 6HH LG DW 2WKHU
FLUFXLWV KDYH DQDO\]HG SULPDU\ DQG VHFRQGDU\ IXQFWLRQV RI
-- 5 of 6 --
8QLWHG6WDWHVY5D\ERUQ 1R
FKXUFKEXLOGLQJV6HHHJ8QLWHG6WDWHVY7HUU\)G
WK&LU
,Q WKLV FDVH KRZHYHU WKH IXQFWLRQ DQDO\VLV FRPSHOV D
FRQFOXVLRQWKDWWKHEXLOGLQJIXQFWLRQHGDVDFKXUFK:KLOH
WKHUH ZHUH RWKHU DFWLYLWLHV LQ WKH EXLOGLQJ ± VXFK DV UDGLR
EURDGFDVWVJRVSHOFRQFHUWVDQGIUHHEXIIHWEUHDNIDVWV±QRQH
RIWKHVHZRXOGVXSSRUWDILQGLQJWKDWWKHEXLOGLQJDOVRVHUYHG
DVIRUH[DPSOHDUDGLRVWDWLRQFRQFHUWKDOORUUHVWDXUDQW
7KHFRQFOXVLRQWKDWWKHIXQFWLRQRIWKHEXLOGLQJZDVLWVXVH
DVDFKXUFKGRHVQRWHQGWKHLQTXLU\,QVWHDGWKHFRXUWVKRXOG
WXUQ WR ZKHWKHU WKH FKXUFK¶V DFWLYLWLHV DIIHFW LQWHUVWDWH
FRPPHUFH,Q&DPSV1HZIRXQG2ZDWRQQD,QFY7RZQRI
+DUULVRQ86 WKH6XSUHPH&RXUWPDGH
FOHDU WKDW FKDULWDEOH DQG QRQSURILW HQWLWLHV DUH PDMRU
SDUWLFLSDQWVLQWKHLQWHUVWDWHPDUNHWIRUJRRGVDQGVHUYLFHV
XVLQJLQWHUVWDWHFRPPXQLFDWLRQVDQGWUDQVSRUWDWLRQUDLVLQJ
DQG GLVWULEXWLQJ UHYHQXHV LQFOXGLQJ YROXQWDULO\ SDLG
UHYHQXHV LQWHUVWDWH ,QGHHG ³ZKLOH FKXUFKHV DUH QRW
FRPPRQO\FRQVLGHUHGDEXVLQHVVHQWHUSULVHFKXUFKHVFDQDQG
GRHQJDJHLQFRPPHUFH7KHμEXVLQHVV¶RUμFRPPHUFH¶RID
FKXUFKLQYROYHVWKHVROLFLWDWLRQDQGUHFHLSWRIGRQDWLRQVDQG
WKH SURYLVLRQ RI VSLULWXDO VRFLDO FRPPXQLW\ HGXFDWLRQDO
UHOLJLRXV RU QRQUHOLJLRXV DQG RWKHU FKDULWDEOH VHUYLFHV´
8QLWHG 6WDWHV Y 2GRP )G WK &LU
,QWKH(OHYHQWK&LUFXLW¶VYLHZWKHHYLGHQFHSURYLQJ
WKDW D FKXUFK EXLOGLQJ LV XVHG LQ RU DIIHFWV LQWHUVWDWH
FRPPHUFH PXVW UHODWH WR WKHVH DFWLYLWLHV ± LH ZKHUHE\ LW
HQJDJHVLQDFWLYLWLHVUHODWLQJWRLWVμEXVLQHVV¶DVDFKXUFK´,G
7XUQLQJWKHQWRDQHYDOXDWLRQRIWKHFKXUFK¶VHIIHFWVRQ
LQWHUVWDWH FRPPHUFH ZH QRWH DW WKH RXWVHW WKDW XQOLNH WKH
SULYDWH UHVLGHQFH LQ -RQHV WKLV LV QRW D FDVH ZKHUH WKH
JRYHUQPHQW UHOLHV RQO\ RQ SDVVLYH DFWLYLWLHV VXFK DV WKH
SXUFKDVHRIXWLOLW\VHUYLFHVRULQVXUDQFHIURPDQRXWRIVWDWH
SURYLGHUWRGHPRQVWUDWHWKHEXLOGLQJ¶VXVHLQDQGHIIHFWRQ
LQWHUVWDWH FRPPHUFH 7KH FKXUFK¶V LQWHUVWDWH FRQQHFWLRQV
ZHUH GLUHFW UHJXODU DQG VXEVWDQWLDO :KLOH WKH FKXUFK¶V
DFWLYLWLHVZHUHXQGHUWDNHQSULPDULO\WRIDFLOLWDWHZRUVKLSWKH\
1R 8QLWHG6WDWHVY5D\ERUQ
2XU FRQFXUULQJ FROOHDJXH WDNHV LVVXH ZLWK RXU YLHZ WKDW WKH
LQWHUVWDWH HOHPHQW RI WKH FULPH LV VDWLVILHG E\ FDXVLQJ RWKHUV WR WUDYHO
DFURVV VWDWH OLQHV WR FDUU\ RQ DQ DFWLYLW\ LQ ZKLFK PRQH\ FKDQJHV KDQGV
,I WKLV ZHUH JRRG FRQVWLWXWLRQDO ODZ LW ZRXOG XQGHUPLQH WKH YDOLGLW\ RI WKH
7UDYHO $FW WKH 0DQQ $FW DQG PDQ\ RWKHU IHGHUDO ODZV LQFOXGLQJ WKH
SXEOLF DFFRPPRGDWLRQV SURYLVLRQV RI WKH &LYLO 5LJKWV $FW RI
QRQHWKHOHVVZHUHFRPPHUFLDOLQQDWXUH$FFRUG8QLWHG6WDWHV
Y*UDVVLH)G WK&LU UHFRJQL]LQJ
WKDW D FKXUFK¶V DFWLYLWLHV PD\ EH ERWK UHOLJLRXV DQG
FRPPHUFLDODWWKHVDPHWLPH 2GRP)G
VDPH
,QSDUWLFXODUWKHFKXUFKXVHGUHJXODUUDGLREURDGFDVWVDV
SDUW RI LWV HYDQJHOLVP WKH GHVLUHG HIIHFW ZDV WR LQFUHDVH
PHPEHUVKLSDQGDWWHQGDQFHDWWKHFKXUFK¶VZRUVKLSVHUYLFHV
DQG RWKHU SURJUDPV %HFDXVH WKH EURDGFDVW DUHD LQFOXGHG
0LVVLVVLSSLDQG$UNDQVDVDVZHOODV7HQQHVVHHWKHORJLFDO
FRQVHTXHQFH RI LQFUHDVHG DWWHQGDQFH ZRXOG EH LQFUHDVHG
WUDYHO LQWR 7HQQHVVHH IURP QHLJKERULQJ VWDWHV &DXVLQJ
LQWHUVWDWHWUDYHOIRUWKHSXUSRVHRIUHFHLYLQJPRQH\IURPWKH
WUDYHOHUVDIIHFWVWKHIORZRIPRQH\LQFRPPHUFHHYHQLIWKH
PRQH\LVDJLIW6HH&DPSV86DW VWDWLQJWKDW
³WKHWUDQVSRUWDWLRQRISHUVRQVDFURVVVWDWHOLQHVKDVORQJEHHQ
UHFRJQL]HGDVDIRUPRIFRPPHUFH´LQDFDVHZKHUHWKHFRXUW
IRXQGWKDWDQRQSURILWFKXUFKDIILOLDWHGVXPPHUFDPSZDV
HQJDJHG LQ FRPPHUFH LQ SDUW EHFDXVH LWV RXWRIVWDWH
DGYHUWLVLQJ SURPSWHG WKH WUDQVSRUWDWLRQ RI FDPSHUV DFURVV
VWDWHOLQHV )XUWKHUPRUHWKHXVHRIWKHUDGLREURDGFDVWV
FOHDUO\ HQFRPSDVVHV DFWLYH HPSOR\PHQW RI FRPPHUFLDO
HQWLWLHVLQFOXGLQJWKUHHUDGLRVWDWLRQVLQ7HQQHVVHHDQGRQH
LQ0LVVLVVLSSL$OWRJHWKHUWKHFKXUFKSDLGLQ
WRWKHYDULRXVUDGLRVWDWLRQVIRULWVEURDGFDVWV
2WKHUIDFWVVXSSRUWDFRQFOXVLRQWKDWWKHEXLOGLQJZDVXVHG
LQLQWHUVWDWHFRPPHUFH%HFDXVHRILWVORFDWLRQZKLFKLVOHVV
WKDQILYHPLOHVWR7HQQHVVHH¶VERUGHUZLWK0LVVLVVLSSLDQGQR
PRUH WKDQ ILIWHHQ PLOHV WR WKH ERUGHU ZLWK $UNDQVDV WKH
FKXUFK GUHZ PHPEHUV IURP 7HQQHVVHH $UNDQVDV DQG
0LVVLVVLSSL7KHFKXUFKDOVRKRVWHGIUHHHYHQWVWRZKLFKWKH
-- 6 of 6 --
Connect Omnilex to search the legal corpus from your AI assistant.