00a0269p.06

7KLV GHFLVLRQ ZDV RULJLQDOO\ LVVXHG DV DQ ³XQSXEOLVKHG GHFLVLRQ´
ILOHG RQ -XO\ 2Q $XJXVW WKH FRXUW GHVLJQDWHG WKH
RSLQLRQ DV RQH UHFRPPHQGHG IRU IXOOWH[W SXEOLFDWLRQ

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$SSHOOHH
Y
/$55< '($1 '86(1%(5<
'HIHQGDQW$SSHOODQW
;!

1
1R
$SSHDOIURPWKH8QLWHG6WDWHV'LVWULFW&RXUW
IRUWKH1RUWKHUQ'LVWULFWRI2KLRDW$NURQ
1R²-DPHV6*ZLQ'LVWULFW-XGJH
6XEPLWWHG-XQH
'HFLGHGDQG)LOHG-XO\
%HIRUH0$57,1&KLHI-XGJH:(//)25'DQG
%$7&+(/'(5&LUFXLW-XGJHV

-- 1 of 4 --

8QLWHG6WDWHVY'XVHQEHU\ 1R
BBBBBBBBBBBBBBBBB
&2816(/
21%5,()/DUU\'HDQ'XVHQEHU\7HUUH+DXWH,QGLDQD
SURVH+HUEHUW-9LOOD$66,67$1786$77251(<
&OHYHODQG2KLRIRU$SSHOOHH
BBBBBBBBBBBBBBBBB
23,1,21
BBBBBBBBBBBBBBBBB
3(5&85,$0/DUU\'HDQ'XVHQEHU\DSSHDOVDGLVWULFW
FRXUW MXGJPHQW JUDQWLQJ VXPPDU\ MXGJPHQW IRU WKH
JRYHUQPHQW LQ WKLV DGPLQLVWUDWLYH IRUIHLWXUH SURFHHGLQJ
LQLWLDWHGSXUVXDQWWR86&† D 7KLVFDVHKDV
EHHQUHIHUUHGWRDSDQHORIWKHFRXUWSXUVXDQWWR5XOH M
5XOHV RI WKH 6L[WK &LUFXLW 8SRQ H[DPLQDWLRQ WKLV SDQHO
XQDQLPRXVO\DJUHHVWKDWRUDODUJXPHQWLVQRWQHHGHG)HG5
$SS3 D
2Q$SULO'XVHQEHU\ZDVDUUHVWHGRQGUXJDQG
SRVVHVVLRQ RI ILUHDUP FKDUJHV 'XULQJ D VHDUFK RI
'XVHQEHU\¶V SURSHUW\ DW WKH WLPH RI WKH DUUHVW ODZ
HQIRUFHPHQWDJHQWVVHL]HGDSSUR[LPDWHO\LQFDVKD
&KHYUROHW0RQWH&DUORDXWRPRELOHDQGPLVFHOODQHRXV
SHUVRQDOSURSHUW\'XVHQEHU\¶VFODLPIRUFRPSHQVDWLRQIRU
WKLVSURSHUW\LVQRZDWLVVXH
'XVHQEHU\LQLWLDOO\ILOHGD)HG5&ULP3 H PRWLRQ
UHTXHVWLQJWKHUHWXUQRIWKHVHL]HGSURSHUW\ZKLFKPRWLRQ
ZDV GHQLHG 8SRQ DSSHDO WKLV FRXUW YDFDWHG WKH GLVWULFW
FRXUW¶VMXGJPHQWDQGUHPDQGHGWKHFDVH6HH'XVHQEHU\Y
8QLWHG6WDWHV1R:/ WK&LU6HSW
XQSXEOLVKHGRUGHU :HGLUHFWHGWKDWWKHGLVWULFW
FRXUW³FRQVWUXHWKHPDWWHUDVDFLYLODFWLRQVHHNLQJHTXLWDEOH
UHOLHI DQG GHWHUPLQH ZKHWKHU WKH JRYHUQPHQW SURYLGHG
'XVHQEHU\ZLWKDFWXDOQRWLFHRIWKHYDULRXVIRUIHLWXUHV´,G
DW

-- 2 of 4 --

1R 8QLWHG6WDWHVY'XVHQEHU\
7KHGLVWULFWFRXUWWKHQSUHVLGHGRYHUDWHOHSKRQHGHSRVLWLRQ
RI-DPHV/DZVRQDQ,QPDWH6\VWHPV2IILFHUVDWWKH)HGHUDO
&RUUHFWLRQDO,QVWLWXWLRQLQ0LODQ0LFKLJDQZKHUH'XVHQEHU\
ZDVLQFDUFHUDWHGDWWKHWLPHWKHDOOHJHGQRWLFHUHJDUGLQJWKH
FDVKZDVGHOLYHUHGLQFRQQHFWLRQZLWKWKLVFRQWURYHUV\
7KH GLVWULFW FRXUW GHWHUPLQHG WKDW WKH SHUVRQDO SURSHUW\
VKRXOGKDYHEHHQUHWXUQHGXSRQ'XVHQEHU\¶VFRQYLFWLRQEXW
VRPH SHUVRQDO LWHPV KDG EHHQ GHVWUR\HG DQG QR IRUIHLWXUH
SURFHHGLQJKDGEHHQLQLWLDWHG,QDGGLWLRQWKHGLVWULFWFRXUW
IRXQGWKDW'XVHQEHU\ZDVHQWLWOHGWRWKHYDOXHRIWKHSHUVRQDO
SURSHUW\DWWKHWLPHLWZDVVHL]HG0RUHVLJQLILFDQWKRZHYHU
DW WKDW KHDULQJ 'XVHQEHU\ DGPLWWHG WKDW KH SXUFKDVHG WKH
LWHPVRISHUVRQDOSURSHUW\DQGWKH0RQWH&DUORZLWK
SURFHHGVIURPGUXJVDOHV7KHGLVWULFWFRXUWWKHQGLUHFWHGWKH
SDUWLHVWREULHIWKHLVVXHZKHWKHU'XVHQEHU\ZDVHQWLWOHGWR
WKH YDOXH RI SHUVRQDO SURSHUW\ DQG WKH YHKLFOH DGPLWWHGO\
ERXJKWZLWKGUXJPRQH\
$IWHUWKHFDVHZDVUHDVVLJQHGWRDQRWKHUGLVWULFWMXGJHWKH
FRXUWGHWHUPLQHGWKDWWKHQRWLFHUHFHLYHGDWWKH0LODQSULVRQ
IDFLOLW\ZDVUHDVRQDEO\FDOFXODWHGWRQRWLI\'XVHQEHU\RIWKH
IRUIHLWXUHDFWLRQDQGWKDWVLQFH'XVHQEHU\DGPLWWHGWKDWKH
SXUFKDVHGWKH0RQWH&DUORDQGPLVFHOODQHRXVSHUVRQDO
SURSHUW\ ZLWK GUXJ SURFHHGV KH KDG QR SURSHUW\ ULJKWV LQ
WKHVHLWHPV6XPPDU\MXGJPHQWZDVDFFRUGLQJO\JUDQWHGWR
WKHJRYHUQPHQWDQGWKLVWLPHO\DSSHDOIROORZHG
7KLVFRXUWUHYLHZVDMXGJPHQWJUDQWLQJVXPPDU\MXGJPHQW
GHQRYRDQGXVHVWKHVDPHVWDQGDUGVDVXVHGE\WKHGLVWULFW
FRXUW 6HH ((2& Y 3UHYR¶V )DPLO\ 0NW ,QF )G
WK &LU 3HRSOHV %DQN 7UXVW &R RI
0DGLVRQ&RXQW\Y$HWQD&DV 6XU&R)G
WK &LU 6XPPDU\ MXGJPHQW LV DSSURSULDWH ZKHUH
³WKHUHLVQRJHQXLQHLVVXHDVWRDQ\PDWHULDOIDFWDQG>@WKH
PRYLQJSDUW\LVHQWLWOHGWRDMXGJPHQWDVDPDWWHURIODZ´
6HH)HG5&LY3 F /D3RLQWHY8QLWHG$XWRZRUNHUV
/RFDO )G WK &LU 7KH SDUW\
RSSRVLQJ D PRWLRQ IRU VXPPDU\ MXGJPHQW ³μPD\ QRW UHVW
XSRQWKHPHUHDOOHJDWLRQVRUGHQLDORIKLVSOHDGLQJEXW

-- 3 of 4 --

8QLWHG6WDWHVY'XVHQEHU\ 1R
PXVWVHWIRUWKVSHFLILFIDFWVVKRZLQJWKDWWKHUHLVDJHQXLQH
LVVXHIRUWULDO¶´$QGHUVRQY/LEHUW\/REE\,QF86
TXRWLQJIRUPHU)HG5&LY3 H ³7KH
PHUH H[LVWHQFH RI D VFLQWLOOD RI HYLGHQFH LQ VXSSRUW RI WKH
SODLQWLII¶VSRVLWLRQZLOOEHLQVXIILFLHQWWKHUHPXVWEHHYLGHQFH
RQZKLFKWKHMXU\FRXOGUHDVRQDEO\ILQGIRUWKHSODLQWLII´,G
DW
:H FRQFOXGH ILUVW WKDW VXPPDU\ MXGJPHQW IRU WKH
JRYHUQPHQWZDVSURSHUUHJDUGLQJWKHLQFDVK7KH
JRYHUQPHQWKDVSURYLGHGSHUVXDVLYHHYLGHQFHWKDWDSULVRQ
PDLOURRPHPSOR\HHVLJQHGWKHFHUWLILHGPDLOUHFHLSW7KH
JRYHUQPHQWKDVRIIHUHGWKHDIILGDYLWRI-DPHV/DZVRQDQ
,QPDWH 6\VWHPV 2IILFHU DW WKH 0LODQ )DFLOLW\ /DZVRQ
DWWHVWHGWKDWKHVLJQHGWKHFHUWLILHGPDLOUHFHLSWDQGGHVFULEHG
WKH SURFHVV IRU IRUZDUGLQJ SULVRQ PDLO WR WKH LQPDWHV
/DZVRQ¶V GHSRVLWLRQ WHVWLPRQ\ LV FRQVLVWHQW ZLWK KLV
DIILGDYLW
1RWZLWKVWDQGLQJ 'XVHQEHU\¶V FRQWHQWLRQ WKDW KH GLG QRW
UHFHLYHDFWXDOQRWLFHWKLVQRWLFHZDV³UHDVRQDEO\FDOFXODWHG
XQGHUDOOWKHFLUFXPVWDQFHVWRDSSULVH>KLP@RIWKHSHQGHQF\
RIWKHDFWLRQDQGDIIRUG>KLP@DQRSSRUWXQLW\WRSUHVHQW>KLV@
REMHFWLRQV´0XOODQH86DW$VWKHGLVWULFWFRXUW
FRUUHFWO\VWDWHGFLWLQJ8QLWHG6WDWHVY5HDO3URSHUW\7UHH
7RS1R:/DW WK&LU2FW
XQSXEOLVKHGRSLQLRQ WKLVFRXUWGRHVQRWUHTXLUHWKH
JRYHUQPHQWWRVKRZWKDWWKHPDLODFWXDOO\UHDFKHGDQLQPDWH
LQ RUGHU WR VDWLVI\ UHTXLUHPHQWV RI GXH SURFHVV %HFDXVH
DGHTXDWHQRWLFHZDVJLYHQ'XVHQEHU\LVQRWHQWLWOHGWRUHOLHI
RQWKLVFODLP7KH7UHH7RSGHFLVLRQZDVGHFLGHGDIWHUWKLV
FRXUW¶VRSLQLRQUHPDQGLQJWKLVFDVHWRWKHGLVWULFWFRXUWIRU
GHWHUPLQDWLRQDVWRWKHVXIILFLHQF\RIQRWLFHDQGLVWKHPRVW
UHFHQWUHIOHFWLRQRI6L[WK&LUFXLWODZRQSRLQW
$W WKH KHDULQJ WR GHWHUPLQH WKH YDOXH RI WKH SHUVRQDO
SURSHUW\ 'XVHQEHU\ DGPLWWHG WKDW WKH FDU DQG SHUVRQDO
SURSHUW\ ZHUH SXUFKDVHG ZLWK GUXJ SURFHHGV 7KXV WKH
VXIILFLHQF\RIQRWLFHUHJDUGLQJIRUIHLWXUHRIWKH0RQWH&DUOR
RU YLRODWLRQ RI 'XVHQEHU\¶V GXH SURFHVV ULJKWV XSRQ WKH
1R 8QLWHG6WDWHVY'XVHQEHU\
GHVWUXFWLRQ RI KLV SHUVRQDO SURSHUW\ DUH QRW WKH LVVXHV
SUHVHQWHGLQWKLVFDVH,QVWHDGWKHLVVXHLVVLPSO\ZKHWKHU
'XVHQEHU\LVHQWLWOHGWRFRPSHQVDWLRQXQGHUWKDWDGPLWWHG
FLUFXPVWDQFH
$FTXLVLWLRQ RI SURSHUW\ WKURXJK GUXJ SURFHHGV DIIHFWV D
FODLPDQW¶VULJKWWRWKDWSURSHUW\LQIRUIHLWXUHDFWLRQV,QWKLV
FLUFXLW ³RQH QHYHU DFTXLUHV D SURSHUW\ ULJKW WR >GUXJ@
SURFHHGV ZKLFK LQFOXGH QRW RQO\ FDVK EXW DOVR SURSHUW\
VHFXUHGZLWKWKHSURFHHGVRILOOHJDODFWLYLW\´8QLWHG6WDWHV
Y6DOLQDV)G WK&LU 6HHDOVR8QLWHG
6WDWHVY7LOOH\)G WK&LU 6RPHRQH
ZKR SXUFKDVHV SURSHUW\ ZLWK GUXJ SURFHHGV ³KDV QR
UHDVRQDEOHH[SHFWDWLRQWKDWWKHODZZLOOSURWHFWFRQGRQHRU
HYHQ DOORZ KLV FRQWLQXHG SRVVHVVLRQ RI VXFK SURFHHGV
EHFDXVHWKH\KDYHWKHLUYHU\JHQHVLVLQLOOHJDODFWLYLW\´
'XVHQEHU\¶V DGPLVVLRQ DERXW GUXJ SURFHHGV FRPELQHG
ZLWKKLVWHVWLPRQ\WKDWKHKDGEHHQXQHPSOR\HGVLQFH
WZR \HDUV EHIRUH DQ\ RI WKH LWHPV RU WKH FDU DW LVVXH ZDV
SXUFKDVHGOHDGVWRWKHFRQFOXVLRQWKDWWKHSHUVRQDOSURSHUW\
DQG WKH FDU LQYROYHG ZHUH SXUFKDVHG ZLWK GUXJ SURFHHGV
'XVHQEHU\ KDG QR SURSHUW\ ULJKWV WKHUHIRUH LQ WKH 0RQWH
&DUORRUWKHSHUVRQDOSURSHUW\7RRUGHUFRPSHQVDWLRQIRU
GHVWUXFWLRQRIWKLVSURSHUW\RULPSURSHUQRWLFHRIIRUIHLWXUH
ZRXOGDOORZ'XVHQEHU\WRUHWDLQWKHIUXLWVRILOOHJDODFWLYLWLHV
KLVLQYROYHPHQWLQZKLFKLVXQGLVSXWHG)XUWKHUDVSRLQWHG
RXWE\WKHGLVWULFWFRXUWLQOLJKWRIWKHLOOHJDOVRXUFHRIWKH
0RQWH&DUORDQGSHUVRQDOSURSHUW\LWZRXOGEHDJDLQVWSXEOLF
SROLF\ WR DOORZ 'XVHQEHU\ WR UHWDLQ SURSHUW\ ZKLFK KH
REWDLQHGDVDUHVXOWRILOOHJDODFWLYLW\$FFRUGLQJO\VXPPDU\
MXGJPHQW IRU WKH JRYHUQPHQW ZDV SURSHU UHJDUGLQJ DOO
SHUVRQDOSURSHUW\LQFOXGLQJFDVKDQGWKHDXWRPRELOH
$FFRUGLQJO\WKHGLVWULFWFRXUW¶VMXGJPHQWLV$)),50('

-- 4 of 4 --