Continued Hearing on Defense Motion 1163
180 lines(JURY OUT AT 4:00 P.M.)
JUDGE DAVILA: PLEASE BE SEATED. THANK YOU. THE RECORD SHOULD REFLECT THAT THE JURY HAS LEFT FOR OUR BREAK. COUNSEL, I JUST WANT TO TALK ABOUT WHAT WE SHOULD DO ABOUT -- I GUESS THIS IS -- I WANT TO TALK ABOUT OUR CONTINUED MOTION THAT WE HAD THIS MORNING WITH MR. FLEURMONT, BUT I DON'T KNOW IF WE SHOULD GO FORWARD WITH THAT TODAY. LET ME JUST ASK THE LAWYERS HERE IN THE WELL, ANYTHING FURTHER BEFORE WE BREAK?
(DISCUSSION OFF THE RECORD.)
MR. FLEURMONT: GOOD AFTERNOON, YOUR HONOR.
MR. LEACH: YOUR HONOR, I EXPECT MS. HOLMES'S TESTIMONY TO BE COMPLETE --
JUDGE DAVILA: I'M SORRY. LET ME ASK YOU TO COME FORWARD.
MR. LEACH: MAY I TAKE MY MASK OFF?
JUDGE DAVILA: YEAH, SURE.
MR. LEACH: I EXPECT MS. HOLMES'S TESTIMONY TO COMPLETE EARLY NEXT WEEK, POSSIBLY ON MONDAY. I DON'T KNOW HOW MUCH REDIRECT THE DEFENSE WILL HAVE.
COURT CLERK: TUESDAY.
MR. LEACH: TUESDAY, EXCUSE ME. AND I DON'T KNOW WHAT ADDITIONAL WITNESSES THE DEFENSE INTENDS TO CALL, BUT I DO THINK IT MIGHT BE THE APPROPRIATE TIME TO START THINKING OF WHEN TO SCHEDULE THE CHARGING CONFERENCE AND MAP AROUND THOSE DATES.
JUDGE DAVILA: SURE. OKAY.
MR. DOWNEY: YEAH, I CERTAINLY THINK THE DEFENSE CASE WILL NOT LAST THE BALANCE OF NEXT WEEK AFTER MS. HOLMES'S TESTIMONY, SO I THINK IT DOES IMPLICATE AT LEAST TWO ISSUES I CAN THINK OF. ONE IS THAT I AGREE WITH MR. LEACH THAT IF WE CAN FIND A TIME TO THINK ABOUT CHARGING AND, YOU KNOW, WE PROBABLY OWE THE COURT SOME FILINGS ON THAT, WHICH WE CAN, WE CAN GET ON FILE EXPEDITIOUSLY IF THAT SUITS THE COURT, AND THAT WAY WE CAN KEEP MOVING.
JUDGE DAVILA: WELL, IT DOES. I'D LIKE TO KEEP AN EYE ON THAT. I KNOW YOUR ORIGINAL SUBMISSIONS WERE MONTHS AGO.
MR. DOWNEY: RIGHT.
JUDGE DAVILA: THINGS HAVE CHANGED A BIT PERHAPS. AND I HAVE THOSE. I'VE USED THEM AS A WORKING COPY, BUT CANDIDLY, I STEPPED BACK BECAUSE I ANTICIPATE THERE WILL BE CHANGES, AND WE SHOULD DEVOTE OUR RESOURCES TOWARDS A FRESH SET. SO WHAT'S YOUR THOUGHTS ABOUT THAT? AND, MR. DOWNEY, I DON'T WANT -- WHEN WE ASK THESE QUESTIONS, OF COURSE THERE MAY BE SOME OTHER EVIDENCE THAT YOU'RE GOING TO PUT IN THAT MIGHT CALL FOR OTHER INSTRUCTIONS.
MR. DOWNEY: SURE. AND I THINK PART OF THE REASON WE'RE HAVING THIS CONVERSATION IS THAT IT'S EVIDENT TO ALL OF US IS THAT WE HAVE THREE DAYS THIS WEEK WITHOUT A JURY AND THEN NEXT WEEK WE'RE, WE'RE BACKED UP WITH THE JURY EVERY DAY. SO THIS IS MORE OF A SCHEDULING MATTER OBVIOUSLY.
JUDGE DAVILA: RIGHT.
MR. DOWNEY: EVENTS CAN ALWAYS CHANGE SUBJECT TO EVIDENCE.
JUDGE DAVILA: RIGHT. SO WHAT ARE YOUR THOUGHTS ABOUT -- WHAT WOULD YOU LIKE TO DO TO SOLVE THE PROBLEM? DO YOU WANT TO GET ME OR AUGMENT YOUR SET? SHOULD I GET A NEW SET FROM YOU?
MR. DOWNEY: I THINK THAT WOULD BE WELL. LET ME -- CAN I JUST TALK TO MS. SAHARIA?
JUDGE DAVILA: SURE.
(DISCUSSION AMONGST DEFENSE COUNSEL OFF THE RECORD.)
JUDGE DAVILA: AND LET ME SAY, WHILE YOU'RE DISCUSSING THIS, I'M NOT -- I DON'T MEAN TO TASK YOU, OVER TASK YOU WITH CREATING A WHOLE NEW SET. BUT THERE MIGHT BE SOME AUGMENTATION IF THAT WOULD BE EASIER FOR YOU. THAT'S FINE, TOO.
(DISCUSSION OFF THE RECORD.)
MR. LEACH: YOUR HONOR, THE GOVERNMENT -- I'LL WAIT FOR MY COLLEAGUES.
(PAUSE IN PROCEEDINGS.)
MR. DOWNEY: I THINK FROM OUR PERSPECTIVE, YOUR HONOR, WE HAD -- WE HAD, AT THE OUTSET, AS YOU MENTIONED, SUBMITTED SOME PROPOSED INSTRUCTIONS. I THINK WE'VE AUGMENTED THOSE OVER TIME IN LIGHT OF SUBSEQUENT DEVELOPMENTS. AND I THINK WE ALSO HAVE NOTED THE OBJECTIONS WE HAVE TO WHAT THE GOVERNMENT SUBMITTED ORIGINALLY. IF IT WOULD BE HELPFUL -- I DON'T THINK WE'RE QUITE IN A POSITION TO FILE THOSE, BUT WE COULD DO IT PROBABLY LATE TOMORROW NIGHT SO YOUR HONOR COULD HAVE THEM THURSDAY MORNING TO WORK ON IF THAT'S HELPFUL.
JUDGE DAVILA: WELL, I JUST -- I WANT TO GIVE YOU TIME TO DO WHAT YOU NEED TO DO. SO, MR. LEACH, WHAT IS YOUR TEAM'S POSITION?
MR. LEACH: THURSDAY IS CERTAINLY SUFFICIENT FOR US TO AUGMENT OUR FILINGS. WE MAY HAVE A FEW, BUT I DON'T THINK THE VOLUME FROM THE GOVERNMENT WILL BE SIGNIFICANT, AND I ALSO THINK THAT WE COULD BE AVAILABLE ON FRIDAY FOR A CONFERENCE. I REALIZE THERE MIGHT BE SOME ISSUES THAT ARE RESOLVED, BUT THAT FRIDAY COULD BE USED PRODUCTIVELY IF THE COURT IS AVAILABLE.
JUDGE DAVILA: SURE.
MR. DOWNEY: WELL, I ALSO RECOGNIZE IT'S A SHORT WINDOW FOR THE COURT, BUT FRIDAY OR MONDAY IS FINE FOR US. I THINK THE COURT MAY BE SCHEDULED OTHERWISE ON MONDAY, BUT I'M NOT SURE.
JUDGE DAVILA: WELL, LET'S DO THIS, WHAT I'LL DO IS I'LL RESERVE -- I DON'T THINK WE HAVE ANYTHING ON FRIDAY, DO WE?
COURT CLERK: THIS FRIDAY?
JUDGE DAVILA: CORRECT.
COURT CLERK: NO, YOUR HONOR.
JUDGE DAVILA: OTHER THAN RESPITE.
(LAUGHTER.)
JUDGE DAVILA: WELL, WHAT WE CAN DO IS I'LL MAKE MYSELF AVAILABLE, AND MAYBE WE CAN HAVE JUST A HIGH LEVEL PASS AND WE CAN SEE WHERE WE ARE ON THESE THINGS WITHOUT -- AND I'M NOT SUGGESTING OR GUARANTEEING THAT WE'LL HAVE ANY FORMAL, FORMAL FINALITY AS TO WHAT THEY ARE. BUT I THINK IT WOULD BE A GOOD IDEA JUST TO GIVE A HIGH LEVEL PASS ON WHAT WE HAVE NOW. AND AGAIN, THINGS COULD CHANGE DEPENDING ON WHERE THE EVIDENCE GOES AND --
MR. DOWNEY: AND I THINK THERE ARE PROBABLY SOME THINGS THAT WE CAN'T DO UNTIL THE EVIDENCE CLOSES, BUT, YEAH.
JUDGE DAVILA: RIGHT. BUT I APPRECIATE THE OFFER TO GET STARTED ON THIS. WELL, LET'S DO THAT. I'LL KEEP FRIDAY OPEN, AND WE CAN HAVE A DISCUSSION ABOUT IT. AND YOU'LL SUBMIT SOMETHING, WHAT, CLOSE OF BUSINESS THURSDAY? DID YOU SAY THAT?
MR. LEACH: IF THAT'S OKAY WITH THE COURT.
MR. DOWNEY: THAT'S FINE, YOUR HONOR.
JUDGE DAVILA: THAT GIVES US ALL NIGHT TO LOOK AT THEM.
MR. DOWNEY: WE CAN MAKE AN EFFORT TO SUBMIT THEM WEDNESDAY NIGHT IF THAT MAKES IT EASIER FOR YOU.
JUDGE DAVILA: IF YOU CAN. I SEE MS. SAHARIA SAYING, YES, THAT'S FINE.
MS. SAHARIA: THAT'S FINE, YOUR HONOR.
JUDGE DAVILA: GREAT. I APPRECIATE IT. THAT'S GOOD.
MR. LEACH: COULD WE HAVE THURSDAY MORNING?
MR. DOWNEY: YEAH, WHEN I SAY WEDNESDAY NIGHT, I'M NOT SURE THERE'S A BIG DIFFERENCE BETWEEN WHAT I'M TALKING ABOUT.
JUDGE DAVILA: LET'S FIGURE OUT OUR TIME ZONE FIRST. LET'S START THERE. THAT'S FINE. 10:00 O'CLOCK. WHY DON'T WE SAY 10:00 O'CLOCK ON THURSDAY.
COURT CLERK: FOR THE HEARING ON FRIDAY?
JUDGE DAVILA: NO. THIS IS FOR YOUR SUBMISSIONS.
MR. LEACH: YES.
COURT CLERK: WHAT TIME WOULD YOU LIKE TO START ON FRIDAY?
JUDGE DAVILA: WE'LL START AT 9:00 O'CLOCK? IS THAT ALL RIGHT? DOES THAT WORK FOR YOUR TEAMS?
MR. DOWNEY: YES, THAT'S FINE.
JUDGE DAVILA: LET'S DO THAT. GREAT. THANK YOU. THANK YOU FOR THAT. YOU PUT YOUR MASK ON TOO QUICKLY, MR. DOWNEY.
MR. DOWNEY: YES. THIS IS PROBABLY ONLY MY THIRD TRIP UP. WE'LL SEE HOW MANY ARE LEFT. I UNDERSTAND THAT IN CONNECTION WITH THE MATTER MR. FLEURMONT IS GOING TO DISCUSS WITH YOU, MR. WADE SPOKE WITH MR. COOPERSMITH AND ASKED HIM TO BE AVAILABLE IN CONNECTION WITH STATING WHATEVER POSITION HE WOULD STATE IN RESPONSE TO YOUR HONOR'S QUESTIONS. SO I BELIEVE HE IS -- HE IS HERE, YES, I BELIEVE HE'S HERE.
JUDGE DAVILA: OKAY. ALL RIGHT. THANK YOU. WELL, I WANTED TO -- I SEE MS. VOLKAR HERE, TOO. ONE OF THE THOUGHTS I HAD, I KNOW MS. VOLKAR HAD INDICATED SHE WANTED TO REVIEW THE TRANSCRIPTS, AND I DID NOT WANT TO ENGAGE THIS UNTIL EVERYBODY IS READY, INCLUDING AN ABILITY TO TALK ABOUT THIS 106 ISSUE AS IT EXISTED. BUT, MS. VOLKAR, WHAT IS YOUR THOUGHT ON TIMING? MR. FLEURMONT, ARE YOU HERE? YES, THANK YOU.
MS. VOLKAR: MAY I REMOVE MY MASK, YOUR HONOR?
JUDGE DAVILA: YES, THANK YOU. AS WELL AS MR. FLEURMONT.
MR. FLEURMONT: THANK YOU, YOUR HONOR.
MS. VOLKAR: TO BE CLEAR, YOUR HONOR, THE GOVERNMENT WOULD LIKE ADDITIONAL TIME TO GO THROUGH THE TRANSCRIPT FOR THE RULE 106 ADDITIONS. IT WOULD BE BENEFICIAL TO THE GOVERNMENT IF THE COURT WERE ABLE TO GIVE A TENTATIVE OR SORT OF WHAT IT WAS THINKING. AS OBVIOUSLY JUST AN EXAMPLE, I WOULD HAVE BEEN REVIEWING WITH THE NULL PROTOCOL SECTION IN MIND, BUT I UNDERSTAND THE DEFENSE HAS WITHDRAWN THAT SECTION. EACH SECTION THAT IS GOING TO BE REMOVED IS LESS THAT I WOULD LOOK FOR RULE 106 COMPLETENESS ADDITIONS TO. SO WITH THAT, I COULD PROVIDE THE COURT AND THE DEFENSE WITH THE RULE 106 BY THURSDAY NIGHT, I BELIEVE. BUT IT WOULD BE HELPFUL TO KNOW WHAT THE VOLUME IS. IF THE VOLUME SHRINKS, I COULD GET IT TO THEM SOONER.
MR. FLEURMONT: THURSDAY NIGHT WOULD BE FINE WITH US, YOUR HONOR. WE DON'T NEED A TENTATIVE RULING. I THINK THE COURT SHOULD BE INFORMED OF ALL OF THE ISSUES AND WE SHOULD HAVE A FULL DISCUSSION BEFORE WE HAVE A RULING, AND IF THEY NEED UNTIL THURSDAY TO HAVE THEIR RULE 106 DESIGNATIONS, I THINK THAT'S OKAY WITH US.
JUDGE DAVILA: SO YOU WOULD LIKE US TO CONTINUE OUR DISCUSSION THURSDAY? IS THAT WHAT I HEAR YOU SAYING?
MS. VOLKAR: WELL, YOUR HONOR --
JUDGE DAVILA: ARE YOU SAYING YOU WOULD LIKE THE RULING NOW SO YOU COULD THEN LOOK? IS THAT WHAT I HEARD YOU SAY?
MS. VOLKAR: I GUESS THE CLEAREST POINT OF THE GOVERNMENT'S POSITION IS THAT WE DON'T BELIEVE THE EVIDENCE IS ADMISSIBLE, AND SO THEREFORE I WOULD RATHER NOT SPEND THE TIME ON RULE 106 --
JUDGE DAVILA: I UNDERSTAND. I UNDERSTAND.
MS. VOLKAR: -- TO POSSIBLY BE TOO BLUNT. BUT THE GOVERNMENT'S POSITION IS THAT UNDER RULE 804, THIS EVIDENCE IS NOT ADMISSIBLE. AND ALSO, AS I HOPE I CLARIFIED THIS MORNING, ALTERNATIVELY, MUCH OF THE TESTIMONY IS NOT ADMISSIBLE UNDER RULE 403, EXCUSE ME, AS CUMULATIVE EVIDENCE AS WELL. I DON'T WANT TO REHASH THAT.
JUDGE DAVILA: RIGHT.
MS. VOLKAR: I BELIEVE THAT MATTER HAS BEEN SUFFICIENTLY ARGUED FOR THE COURT TO RULE ON IT. IF THE COURT WERE GOING TO GRANT AND ADMIT ANY OF THE PORTIONS, THEN THE GOVERNMENT WAS REQUESTING TIME FOR RULE 106.
JUDGE DAVILA: OKAY.
MS. VOLKAR: AND I DON'T KNOW THAT THE RULE 106 ADDITIONS HAVE TO HOLD UP YOUR HONOR'S RULING. CANDIDLY, I DON'T QUITE UNDERSTAND MY COLLEAGUE'S COMMENT THAT THE TWO RELATE TO ONE ANOTHER. BUT I DID ALSO FLAG THIS MORNING FOR YOUR HONOR THAT IN DOING THE RULE 106 ANALYSIS I'VE DONE THUS FAR, I HAVE REALIZED THAT IT COULD TRIGGER ADDITIONAL ISSUES, SUCH AS CONFRONTATION CLAUSE ISSUES. I'M JUST PERHAPS FORECASTING WHAT I IMAGINE MY COLLEAGUES MAY SAY, ON THE OTHER SIDE OF THE TABLE MAY SAY. SO THAT, YOUR HONOR, IS WHAT I'VE PERHAPS MUDDIED THE WATERS WITH THIS MORNING, BUT THE GOVERNMENT'S POSITION IS THAT NONE OF IT IS ADMISSIBLE AND I THINK WE CAN DO AWAY WITH THAT, AND IF THE COURT FEELS DIFFERENTLY, OF COURSE --
JUDGE DAVILA: I HEAR BOTH YOUR POSITIONS ARE THE SAME, AND IF YOU JUST RULE FOR US, JUDGE, WE'RE DONE WITH THOSE ISSUES. I THINK I GET THAT. THAT'S CLEAR.
(LAUGHTER.)
JUDGE DAVILA: LET ME SAY THIS, MAYBE WE CAN HAVE A LITTLE DISCUSSION NOW. SOMETHING CAME UP DURING THE EXAMINATION OF MS. HOLMES THAT I THINK I HAVE A QUESTION ABOUT THAT MAY BE SIMILAR TO THE ISSUE IN THE NULL VOID, AND THIS REGARDS TESTIMONY FROM MS. HOLMES ABOUT A CERTAIN ISSUE, I THINK IT WAS ABOUT WALGREENS. I WANT TO GET MY NOTES. I HAVE YOUR MOTION IN MY OFFICE. SO LET'S TAKE ABOUT A 10 MINUTE BREAK. I'LL GO GET THAT AND COME BACK. AS I SAID EARLIER, IT'S THE DEFENSE BURDEN TO SHOW UNAVAILABILITY. SO WHATEVER YOU WANT TO DO ON THAT -- YOU KNOW, IF YOU WANT TO DO SOMETHING ABOUT THAT THIS AFTERNOON, WE CAN DO THAT.
MR. FLEURMONT: YES, YOUR HONOR. I UNDERSTAND THAT MR. COOPERSMITH IS HERE AND HE'S AVAILABLE TO MAKE A PROFFER TO THE COURT CONSISTENT WITH --
JUDGE DAVILA: OKAY. WE'LL TAKE OUR BREAK. WE'LL COME BACK AND YOU'LL TELL ME WHAT YOU WOULD LIKE TO DO IN REGARD TO MR. COOPERSMITH. SHOULD I ORDER HIM TO STAY IN THE COURTROOM, OR IS HE SUBJECT TO FLIGHT DO YOU THINK?
MR. FLEURMONT: I DON'T THINK YOU NEED TO DO THAT.
JUDGE DAVILA: HE'S A TRUSTWORTHY LAD, IS HE?
(LAUGHTER.)
MR. FLEURMONT: YEAH.
COURT CLERK: COURT IS IN RECESS.
(RECESS FROM 4:14 P.M. UNTIL 4:41 P.M.)
JUDGE DAVILA: THANK YOU. WE'RE BACK ON THE RECORD WITH ALL PARTIES BEING PRESENT ONCE AGAIN. WE'RE OUTSIDE OF THE PRESENCE OF THE JURY, AND WE WANTED TO HAVE SOME MORE DISCUSSION ON THE MOTIONS BEFORE THE COURT REGARDING PRIOR TESTIMONY. LET ME JUST, LET ME JUST SAY, THANK YOU FOR YOUR ARGUMENTS. I'VE LISTENED TO THE ARGUMENTS. COUNSEL, YOU CAN COME FORWARD IF YOU WOULD LIKE. THANKS. YOU CAN TAKE YOUR MASKS OFF IF YOU WISH.
MS. VOLKAR: THANK YOU, YOUR HONOR.
JUDGE DAVILA: LET ME -- I JUST WANT TO START WITH EXHIBIT C. AND THIS IS ONE WHERE I DON'T THINK I NEED ANY MORE HELP FROM YOU ON THIS. I THINK THERE'S BEEN EVIDENCE REGARDING THE CLIA LAB AND MR. BALWANI'S CONNECTION TO THE CLIA LAB. I THINK DIFFERENT WITNESSES HAVE TOLD THE JURY ABOUT THEIR OBSERVATIONS, THEIR OPINIONS, THEIR OPINIONS SUCH THAT THEY WERE PERMITTED TO TESTIFY ON THIS. I DO THINK THAT, UNDER 403, THIS IS CUMULATIVE. I THINK THERE IS SUFFICIENT, SUFFICIENT EVIDENCE IN THE RECORD NOW THAT SUPPORTS THE FINDINGS, MR. FLEURMONT, THAT YOU SEEK TO CAPTURE WITH 1163-4, EXHIBIT C, AND SO I'M NOT GOING TO ALLOW THIS TO COME IN. I THINK THERE'S PLENTY OF INFORMATION IN THE RECORD ALREADY THAT ESTABLISHES WHAT YOU NEED TO DO. ANYTHING FURTHER, AS I SAID, WOULD BE FOUND CUMULATIVE. SO UNDER 403, I THINK THAT TO ALLOW THIS WOULD TAKE MORE TIME AND WOULD POSSIBLY CONFUSE THE JURY ON THIS ISSUE. IT COULD OPEN UP TO OTHER ADDITIONAL EVIDENCE THAT MIGHT HAVE TO COME IN TO SUPPORT OR DETRACT FROM IT THAT WOULD BE AN UNNECESSARY WASTE OF TIME. SO I'M GOING TO RESPECTFULLY DECLINE YOUR INVITATION TO ADMIT EXHIBIT C. SO THAT'S THE RULING ON THAT. LET'S GO BACK TO WHERE WE WERE INITIALLY. SO LET ME TURN BACK TO YOU, MR. FLEURMONT. YOU HAVE THE FLOOR. LET'S DO THE THRESHOLD ISSUE FIRST. WHY DON'T WE DO THAT?
MR. FLEURMONT: YES, YOUR HONOR. WE WOULD LIKE TO INVITE MR. COOPERSMITH UP SO HE COULD PROVIDE A PROFFER TO THE COURT.
JUDGE DAVILA: ALL RIGHT. THANK YOU. AND, MR. COOPERSMITH, I SEE YOU HERE. THANK YOU FOR BEING HERE. MR. FLEURMONT, THIS IS, AGAIN, YOUR BURDEN. SO WHAT IS IT YOU WOULD LIKE TO KNOW FROM MR. COOPERSMITH. I'M NOT GOING TO -- I'M A NEUTRAL PARTY HERE, SO I JUST NEED TO KNOW WHAT IT IS. THERE'S A QUESTION OF UNAVAILABILITY THAT YOU HAVE INDICATED MR. WADE HAS. HE HAS PROVIDED A DECLARATION TO THE COURT. I'VE INDICATED THAT I NEED MORE WITH RESPECT TO MR. WADE AND THAT DECLARATION. SO WHAT IS IT YOU WOULD LIKE THE COURT TO CONSIDER IN REGARDS TO THE ISSUE OF UNAVAILABILITY OF MR. BALWANI.
MR. FLEURMONT: UNDERSTOOD, YOUR HONOR. OUR FIRST QUESTION IS IF WE WERE TO CALL -- WELL, WE SEEK TO CALL MR. BALWANI IN OUR CASE. IS HE AVAILABLE TO TESTIFY? SO THAT'S THE FIRST QUESTION.
JUDGE DAVILA: SO LET ME ASK THEN, YOU'VE CAUSED THE YOUNG MAN TO COME FORWARD HERE. MAY I KNOW YOUR NAME, SIR?
MR. COOPERSMITH: JEFF COOPERSMITH. I REPRESENT MR. BALWANI.
JUDGE DAVILA: THANK YOU. YOU CURRENTLY REPRESENT HIM?
MR. COOPERSMITH: YES, YOUR HONOR.
JUDGE DAVILA: IN THIS LITIGATION?
MR. COOPERSMITH: YES, YOUR HONOR.
JUDGE DAVILA: AND YOU'RE HERE AS HIS ATTORNEY AND YOU CAN ANSWER ANY QUESTIONS THAT MR. FLEURMONT HAS ABOUT YOU AND YOUR CLIENT AND HIS DESIRE TO ASK YOUR CLIENT QUESTIONS?
MR. COOPERSMITH: YES, YOUR HONOR.
JUDGE DAVILA: OKAY.
MR. FLEURMONT: OKAY. MR. COOPERSMITH, IF WE WERE TO CALL MR. BALWANI IN THIS CASE, WOULD HE BE AVAILABLE TO TESTIFY?
MR. COOPERSMITH: UNDER THE CIRCUMSTANCES, IF MR. BALWANI WERE CALLED AS A WITNESS, I UNDERSTAND THAT UNDER THE ADVICE OF COUNSEL HE WOULD ASSERT HIS FIFTH AMENDMENT RIGHTS WITH RESPECT TO ANY SUBSTANTIVE QUESTION, INCLUDING ON THE TOPICS THAT I UNDERSTAND THE DEFENSE IS INTERESTED IN CALLING HIM FOR BASED ON THEIR MOTION.
JUDGE DAVILA: ALL RIGHT. AND YOU'VE BEEN APPRISED OF THE CONTEXT OF THE QUESTIONS THAT WOULD BE POSED TO YOUR CLIENT WERE HE TO BE SUBPOENAED?
MR. COOPERSMITH: YES, YOUR HONOR. I'VE REVIEWED THE PLEADINGS ON THIS ISSUE. SO YES.
JUDGE DAVILA: OKAY.
MR. FLEURMONT: MR. COOPERSMITH, IF WE WERE TO ASK HIM QUESTIONS RELATED TO HIS ROLE IN THE CLIA LAB, WOULD HE ANSWER THOSE QUESTIONS?
MR. COOPERSMITH: ON ADVICE OF COUNSEL I UNDERSTAND MR. BALWANI WOULD ASSERT HIS FIFTH AMENDMENT RIGHTS.
MR. FLEURMONT: MR. COOPERSMITH, IF WE WERE TO ASK HIM QUESTIONS RELATED TO HIS ROLE IN FINANCIAL MODELING, WOULD HE ANSWER.
MR. COOPERSMITH: AGAIN, ON ADVICE OF COUNSEL, HE WOULD ASSERT HIS FIFTH AMENDMENT RIGHTS.
MR. FLEURMONT: AND, MR. COOPERSMITH, IF WE WERE TO ASK HIM QUESTIONS RELATED TO HIS ROLE IN THE WALGREENS AND SAFEWAY RELATIONSHIPS, WOULD HE ANSWER?
MR. COOPERSMITH: ON ADVICE OF COUNSEL, I UNDERSTAND THAT HE WOULD ASSERT HIS FIFTH AMENDMENT RIGHTS.
JUDGE DAVILA: OKAY. ANYTHING FURTHER, MR. FLEURMONT?
MR. FLEURMONT: NO, YOUR HONOR.
JUDGE DAVILA: OKAY. DO YOU WISH TO CROSS-EXAMINE MR. COOPERSMITH?
(LAUGHTER.)
MS. VOLKAR: I RESPECTFULLY DECLINE, YOUR HONOR.
JUDGE DAVILA: ALL RIGHT. THANK YOU, MR. COOPERSMITH. I APPRECIATE YOUR ATTENTION TO THIS. IT'S BEEN VERY HELPFUL TO THE COURT. THANK YOU.
MR. COOPERSMITH: YOU'RE WELCOME, YOUR HONOR. THANK YOU.
JUDGE DAVILA: ALL RIGHT. THANK YOU. LET ME JUST STATE, AFTER HEARING FROM MR. BALWANI'S ATTORNEY, THE COURT DOES FIND THEN AND MAKES A FINDING THAT WERE MR. BALWANI TO BE CALLED TO TESTIFY IN THIS CASE -- AND ONCE AGAIN, WE ARE OUTSIDE OF THE PRESENCE OF THE JURY NOW -- PURSUANT TO THE REPRESENTATIONS OF COUNSEL, MR. BALWANI WOULD ASSERT HIS FIFTH AMENDMENT PRIVILEGE TO NOT ANSWER THOSE QUESTIONS. SO THE COURT DOES FIND HIM THEN UNAVAILABLE FOR PURPOSES OF TESTIMONY HERE. ALL RIGHT. THANK YOU. AND THANK YOU FOR DOING THAT, MR. FLEURMONT. I APPRECIATE IT. SO ONE OF THE -- I MENTIONED TO YOU THAT THERE WAS SOME TESTIMONY, AND I WAS -- LET ME JUST DRAW YOUR ATTENTION TO IT. I THINK IT WAS IN EXHIBIT 5387D, I THINK IT WAS, BUT IT WAS CONVERSATION REGARDING -- I THINK MS. HOLMES TESTIFIED, I'M PARAPHRASING HERE, BUT "WE WOULD WORK TOGETHER ON A REVENUE PIECE," I THINK IT WAS. AND THAT TO ME SUGGESTED THAT -- I GUESS IT GOES TO THE INCULPATION ISSUE, THAT IF THEY WORKED TOGETHER, THEN THAT MIGHT SOMEHOW MITIGATE THE QUESTION OF WHETHER OR NOT THAT IS INCULPATORY AS TO MR. BALWANI. AND I DON'T HAVE THAT PIECE IN FRONT OF ME, AND I'LL INVITE YOUR TEAMS TO FIND IT FOR ME IF YOU WOULD LIKE. BUT THAT WAS MY GENERAL RECOLLECTION OF THAT TESTIMONY. AND I'M NOT CERTAIN I HAVE THE CITE CORRECT, BUT I DO REMEMBER --
MR. FLEURMONT: I REMEMBER THAT TESTIMONY, YOUR HONOR.
JUDGE DAVILA: GREAT.
MR. FLEURMONT: SO FROM WHAT I REMEMBER, THERE WAS A TEXT MESSAGE AND "WE WORKED TOGETHER ON THE REV PIECE."
JUDGE DAVILA: RIGHT.
MR. FLEURMONT: AND I WASN'T SURE -- I BELIEVE SHE SAID "I WASN'T SURE IF THAT MEANT REVISIONS OR REVENUE."
JUDGE DAVILA: RIGHT.
MR. FLEURMONT: WE DON'T HAVE CONTEXT FOR THAT TEXT MESSAGE. I'M NOT EVEN QUITE SURE WHAT IT WOULD RELATE TO IN TERMS OF WHAT WE'RE DISCUSSING HERE. IT COULD RELATE TO PROJECTIONS. IT COULD RELATE TO THE WALGREENS RELATIONSHIP. I'M NOT -- I DON'T EVEN HAVE ENOUGH CONTEXT I THINK TO UNDERSTAND WHAT IT RELATES TO EVEN IN THIS MOTION. SO I THINK THIS IS JUST AN EXAMPLE OF HOW THAT TEXT MESSAGE IN ISOLATION DOESN'T CHANGE THE NEED FOR ANY OF THE TESTIMONY HERE.
JUDGE DAVILA: OKAY. WELL, I RECALL, I THINK MR. LEACH DREW HER ATTENTION -- I SAY "HER," PARDON ME, I MEAN NO DISRESPECT -- MS. HOLMES'S ATTENTION TO THAT COLLOQUY AND TRACED IT BACK TO REVENUE, IF I RECALL CORRECTLY. AND MR. LEACH HAS THE DOCUMENT HERE.
MS. VOLKAR: YES, YOUR HONOR, WITH THE HELP OF MY -- WITH THE HELP OF MR. LEACH, I DO HAVE --
JUDGE DAVILA: WHAT PAGE WAS THAT ON? MAYBE YOU CAN --
MS. VOLKAR: PAGE 19 OF 5387, SO IT WAS JUST ADMITTED, IT WAS JUST ADMITTED MOMENTS AGO WHEN MR. LEACH MOVED IT INTO EVIDENCE.
JUDGE DAVILA: THANK YOU.
MS. VOLKAR: AND TO BE -- SPECIFICALLY, MR. LEACH ASKED MS. HOLMES ABOUT HER SKYPE MESSAGE, "WE HAVE TO WORK TOGETHER ON THE REV PIECE," I BELIEVE MR. FLEURMONT'S -- MY MEMORY MATCHED MR. FLEURMONT'S WITH RESPECT TO HER ANSWER, WHICH WAS THAT SHE WASN'T SURE WHETHER IT WAS REVENUE OR REVISIONS OR IT COULD HAVE BEEN. AND THEN MR. LEACH POINTED OUT THAT JUST A FEW LINES DOWN, MR. BALWANI RESPONDED, "YOU ARE THE COMPANY," REFERRING TO MS. HOLMES, "WE NEED REVENUE PLUS A FEW SENIOR LEVEL MANAGERS EXPERIENCED EVEN IF THEY ONLY WORK 11 HOURS." AND MY RECOLLECTION IS THAT MR. LEACH ASKED IF SHE HAD ANY REASON TO DOUBT THAT THEY WERE TALKING ABOUT REVENUE, AND I THOUGHT SHE SAID THAT SHE DIDN'T HAVE A REASON TO DOUBT, OR THERE WAS AT LEAST SOME UNCERTAINTY THERE, BUT IT WASN'T A SOLID, NO, WE WEREN'T TALKING ABOUT REVENUE. THAT'S MY BEST RECOLLECTION.
JUDGE DAVILA: ALL RIGHT. THANK YOU. THIS IS WHAT I WAS REMEMBERING, AND IT CAUSED ME TO LOOK BACK AT THE STATEMENT THAT YOU SEEK TO INTRODUCE, AND IT CAUSED ME TO THINK THAT, WELL, IF SHE WAS IN THE REVENUE PIECE, IF MS. HOLMES WAS IN THE REVENUE PIECE, THEN I DON'T SEE WHERE THE INCULPATION IS.
MR. FLEURMONT: YES. SO I THINK THE COURT IS ASKING, BASED ON THIS TEXT MESSAGE AND THE CONTEXT, IS THERE LESS CORROBORATION FOR THE STATEMENT THAT WE SEEK TO ADMIT? THE STATEMENTS WE SEEK TO ADMIT RELATE TO THE PROJECTIONS AND THE FINANCIAL MODEL. I DON'T THINK THERE'S ANYTHING IN THESE TEXT MESSAGES THAT CONTRADICT HIS TESTIMONY THAT HE OWNED THE MODEL OR CONTRADICT HIS TESTIMONY RELATED TO WALGREENS AND HIS RELATIONSHIP WITH WALGREENS. THE FACT THAT THEY'RE DISCUSSING REVENUE AND ARE BOTH TALKING ABOUT REVENUE, I DON'T THINK UNDERMINES HIS STATEMENT THAT "I OWNED THE FINANCIAL MODEL." SHE -- MS. HOLMES MAY KNOW ABOUT REVENUE, AND I THINK A CEO OF A COMPANY WILL KNOW ABOUT SOME REVENUE. BUT IT DOESN'T NECESSARILY MEAN THAT THE STATEMENTS THAT HE'S MAKING IN HIS DEPOSITION ARE UNDERMINED.
MS. VOLKAR: THANK YOU, YOUR HONOR. THE GOVERNMENT WOULD LIKE TO DIRECT THAT THERE ARE TWO REQUIREMENTS AT ISSUE HERE FOR 804(B)(3). THERE IS WHETHER OR NOT THE SUBJECT, OR THE STATEMENT TENDED TO SUBJECT THE DECLARANT TO PENAL LIABILITY OR CRIMINAL LIABILITY. THAT'S THE INCULPATORY STATEMENTS THAT WE HAVE SPENT A LOT OF TIME TALKING ABOUT. AND THEN THERE'S ALSO THE SECOND REQUIREMENT FOR 804(B)(3), THAT THERE EXIST CORROBORATING CIRCUMSTANCES THAT CLEARLY INDICATE THE STATEMENT'S TRUSTWORTHINESS. AND I THINK THAT YOUR HONOR FORESAW WHERE THE GOVERNMENT WAS GOING. I THINK THAT WHAT OUR POSITION IS HERE IS THAT THERE ISN'T SUFFICIENT EVIDENCE TO CORROBORATE OR SHOW THE TRUSTWORTHINESS OF THESE STATEMENTS WHEN THE TESTIMONY TO DATE HAS BEEN PERHAPS MR. BALWANI WOULD BE THE ONE TO PRESENT THE PROJECTIONS, THERE HAS BEEN SOME TESTIMONY THERE. THERE HASN'T NECESSARILY BEEN ANY TESTIMONY ABOUT WHO CREATED OR WHO OWNED THE MODELS. THIS WOULD BE SORT OF THE FIRST INSTANCE OF THAT.
AND WHAT WE DO HAVE ARE TEXT MESSAGES SHOWING THAT MR. BALWANI AND MS. HOLMES TALKED ABOUT THESE MODELS, AND IT IS AT BEST UNCLEAR WHO WAS REALLY TAKING OWNERSHIP OF IT. SO I WANT TO FOCUS ON THE PIECE THAT DEFENSE COUNSEL IS TALKING ABOUT, THE OWNERSHIP PIECE. THERE ISN'T ANY CORROBORATION OR ANYTHING TO INDICATE TRUSTWORTHINESS OF THAT PORTION. IN FACT, THE TEXT MESSAGES, I WOULD SAY, POINT IN BOTH DIRECTIONS AND THE TESTIMONY WE HAVE HEARD TODAY POINTS IN BOTH DIRECTIONS. AND THEN IN TERMS OF THE REMAINDER OF THE STATEMENT AROUND IT, THAT MR. BALWANI WORKED WITH MULTIPLE PEOPLE TO BUILD THIS MODEL, THAT'S WHERE I GO BACK TO THE GADSON AND THE PRONG ABOUT INCULPATORY STATEMENTS BECAUSE GADSON SAYS IF SOMEONE IS DEFLECTING OR SHARING BLAME, THAT'S NOT INCULPATORY. SO I WOULD SAY THAT BETWEEN THOSE TWO PRONGS, ALL OF THE PORTIONS ABOUT THE FINANCIAL MODEL AND PROJECTIONS ARE INADMISSIBLE HEARSAY.
MR. FLEURMONT: IF I COULD BRIEFLY RESPOND, YOUR HONOR?
JUDGE DAVILA: YES, PLEASE.
MR. FLEURMONT: BRIAN GROSSMAN TESTIFIED THAT HE RECEIVED THE FINANCIAL MODEL FROM SUNNY, FROM MR. BALWANI, EXCUSE ME. AND THERE IS OTHER -- AND THAT'S AT TRANSCRIPT 6411, NOVEMBER 16TH. THERE'S TESTIMONY FROM GENERAL MATTIS THAT THE BOARD RECEIVED PRESENTATIONS ABOUT THE FINANCIALS FROM MR. BALWANI. THE RULE DOES NOT REQUIRE, AND I HAVE NOT SEEN A CASE THAT SAYS THIS, THAT THE RULE REQUIRES A WITNESS TO SAY WHAT THE, WHAT THE PROPONENT WANTS TO ADMIT IS -- THERE'S NO REQUIREMENT THAT THERE'S A ONE-TO-ONE MATCH WITH THE STATEMENT THAT THE DECLARANT WANTS TO ADMIT AND THE CORROBORATION. WHAT THE RULE REQUIRES IS THAT CORROBORATING CIRCUMSTANCES THAT INDICATE TRUSTWORTHINESS. AND SO THE TESTIMONY OF GENERAL MATTIS, THE TESTIMONY OF BRIAN GROSSMAN, AND OTHER STATEMENTS BY MR. BALWANI'S SWORN DECLARATION, EXCUSE ME, SWORN DEPOSITION SUPPORT THE STATEMENTS THAT WE SEEK TO ADMIT.
JUDGE DAVILA: OKAY. IT SEEMS LIKE THERE'S A -- WHAT DO WE DO WHEN THERE'S, THERE'S AN EQUAL WEIGHT OR EQUAL INTERPRETATION AS TO EACH? IT COULD BE LOOKED AT THIS WAY? IT COULD BE LOOKED AT ANOTHER WAY? I GUESS THAT'S FOR THE COURT TO BALANCE AND SEE, BUT THAT'S ONE OF THE THINGS THAT THE COURT HAS TO LOOK AT, AND THAT'S WHY WE'RE HAVING THIS CONVERSATION CANDIDLY. YOU SHOULD UNDERSTAND THAT I'M HAVING DIFFICULTY FINDING THAT HERE. THAT'S WHY WE'RE DISCUSSING THIS NOW. AND THEN I LOOK AT -- AND I DON'T MEAN TO MUDDLE THE WATERS -- BUT ON 1163-3, ECF PAGE 6, LINE 19, THE QUESTION WAS, "DID SHE EVER EDIT THE MODEL?" AND MR. BALWANI TELLS US THAT, HE SAYS, "TO THE BEST OF MY KNOWLEDGE, NO. I HAD QUESTIONS FOR HER AND THEN I PUT A MODEL WITH HER NAME ON IT SO SHE COULD EDIT." THIS IS ONE OF THOSE AREAS THAT, WELL, WAIT A MINUTE, NOW SHE'S EDITING. I DON'T KNOW IF IT'S THE SAME MODEL. IS IT A DIFFERENT MODEL? AND THEN HE SAYS, "I DON'T THINK SHE DID BECAUSE I CONTINUED WITH MY ASSUMPTIONS. I NEVER EVEN LOOKED AT THAT MODEL. SO I THINK MY ANSWER IS NO." SO THAT -- IT JUST CREATES ANOTHER ISSUE OF, IS THAT SUFFICIENT CORROBORATION? YOU'RE GOING TO TELL ME YES.
MR. FLEURMONT: I THINK SO. THERE ARE TWO ISSUES AT PLAY HERE. ONE, IS THERE SUFFICIENT CORROBORATION FOR THE STATEMENT? WE'VE INCLUDED THE STATEMENT BECAUSE IT CORROBORATES THE FACT THAT TO HIS KNOWLEDGE HE NEVER -- TO HIS KNOWLEDGE, SHE DID NOT EDIT THE MODEL, MS. HOLMES DID NOT EDIT THE MODEL. AND HE SAYS AT THE END, "I THINK MY ANSWER IS NO." THE MAIN STATEMENT THAT WE'RE SEEKING TO INTRODUCE IS EARLIER AND -- BUT ONE IN EXHIBIT A WHERE HE SAYS HE OWNS THE MODEL, AND THEN ALSO IN EXHIBIT B WHERE HE SAYS -- THIS IS AT PAGE 4, LINES 8 THROUGH 9 -- "I WOULD, YOU KNOW, UPDATE THE MODEL AND KEEP IT UPDATED."
JUDGE DAVILA: RIGHT.
MR. FLEURMONT: HE IS A PERSON WHO IS UPDATING THIS MODEL. SO THE FACT THAT HE SAYS "TO THE BEST OF MY KNOWLEDGE, NO" IN RESPONSE TO A QUESTION ABOUT MS. HOLMES EDITING THE MODEL CORROBORATES THAT STATEMENT. THE COURT MAY LOOK AT THIS STATEMENT AND SAY -- JUST TO BE CLEAR, I DON'T THINK THIS IS A WHOLESALE EXERCISE. IF THE COURT SEES ONE QUESTION AND ANSWER THAT THEN IT DOESN'T BELIEVE IS EITHER INCULPATORY, OR IF THE COURT SEES ONE QUESTION AND ANSWER AND IT DOESN'T BELIEVE IT'S CORROBORATED, THEN IT SHOULD THROW OUT THE REST OF THE TRANSCRIPT. IF THE COURT THINKS THAT THE SCALES ARE EQUAL ON THIS ONE, I THINK THE COURT IS WELL WITHIN ITS RIGHTS TO LOOK AT THE OTHER STATEMENTS AND SAY, WELL, THIS ONE MEETS THE RULE.
JUDGE DAVILA: OKAY. OKAY.
MS. VOLKAR: YOUR HONOR, I THINK THE COURT'S QUESTIONS SHOW AND DEMONSTRATE WHY THIS -- THESE PORTIONS ARE INADMISSIBLE, AND THE REASON IS BECAUSE WHEN THERE IS EVIDENCE POINTING IN BOTH DIRECTIONS, THE TYPICAL ANSWER IN OUR COURT AND LEGAL SYSTEM IS THROUGH CROSS-EXAMINATION, IS TO TEST IT THROUGH THE ADVERSARIAL PROCESS. AND THAT BRINGS US BACK TO THE FUNDAMENTAL PROBLEM HERE. THE DEFENSE SEEKS TO ADMIT THESE STATEMENTS WHEN THE GOVERNMENT, THE PROSECUTION TEAM HAS NOT HAD THE OPPORTUNITY TO CROSS-EXAMINE MR. BALWANI. AND I KNOW THAT WHEN WE'RE LOOKING AT THIS, WE'RE TALKING ABOUT THOSE TWO PRONGS THAT I MENTIONED. BUT FOR A HEARSAY EXCEPTION, THE INDICATION OF TRUSTWORTHINESS, THAT PRONG IS INCORPORATING THE IDEA THAT IF WE'RE GOING TO BRING IN AN OUT-OF-COURT STATEMENT THAT CAN'T NECESSARILY -- WHERE THE DECLARANT CANNOT BE TESTED THROUGH THE TYPICAL PROCESS OF CROSS-EXAMINATION, DO WE HAVE SUFFICIENT -- DO WE HAVE SUFFICIENT INDICATION OF TRUSTWORTHINESS THAT WE CAN RELY ON THOSE STATEMENTS WITHOUT TESTING THEM THROUGH THE NORMAL TRIAL PROCESS?
JUDGE DAVILA: OKAY.
MS. VOLKAR: AND THAT'S WHERE I WOULD ARGUE, ALTHOUGH WE'RE TALKING ABOUT CORROBORATION, WHEN WE ARE IN A SITUATION THAT THE COURT FACES HERE WHERE THERE IS SOME EVIDENCE THAT POINTS BOTH WAYS, THERE'S NOTHING ELSE EXPLICITLY EVIDENT. AND WITH RESPECT TO MY COLLEAGUE, I LISTENED TO WHAT HE SAID ABOUT MR. GROSSMAN AND THE OTHER INVESTORS RECEIVING THE MODEL, BUT I DIDN'T HEAR ANYTHING ABOUT WHO HAS TESTIFIED, AND I HAVE NOT HEARD ANY TESTIMONY IN THIS CASE FROM A WITNESS TO DATE ABOUT WHO BUILT THE MODEL OTHER THAN THIS.
JUDGE DAVILA: OKAY. MR. FLEURMONT, ANYTHING ELSE YOU WANT ME TO KNOW?
MR. FLEURMONT: YES, YOUR HONOR. BRIEFLY ON THE MODEL VERSUS PROJECTIONS DISCUSSIONS WE HAD EARLIER, I JUST WANTED TO CLARIFY SOME THINGS.
JUDGE DAVILA: SURE.
MR. FLEURMONT: SO THE WAY THE PROJECTIONS WERE MADE WERE BY PLUGGING THE ASSUMPTIONS INTO THE MODEL, AND THERE ARE DIFFERENT ASSUMPTIONS. FOR EXAMPLE, HOW MANY STORES DO WE THINK WILL OPEN THIS YEAR? HOW MUCH REVENUE DO WE THINK WE'LL GET BASED ON DIFFERENT METRICS? ONCE THOSE METRICS WERE PUT INTO THE MODEL, THEN THAT'S WHAT GENERATES A PROJECTION THAT IS ACTUALLY SENT TO THE INVESTOR. SO I JUST WANT IT TO BE CLEAR THAT THE MODEL AND THE PROJECTION ARE ESSENTIALLY THE SAME THING FOR THAT REASON. THE MODEL IS WHAT IS GENERATING THE PROJECTION THAT IS SENT TO THE INVESTORS. SO I WANTED TO CLARIFY THAT.
JUDGE DAVILA: RIGHT. I THINK I FOLLOW THAT.
MR. FLEURMONT: OKAY.
JUDGE DAVILA: THE MODEL IS THE, IS THE INITIAL DOCUMENT WHERE ALL OF THE INFORMATION IS PUT IN, AND THAT IS -- THE FINAL PRODUCT IS THE PROJECTION THAT IS SENT OUT.
MR. FLEURMONT: OKAY. COOL. I JUST WANTED TO MAKE SURE.
(LAUGHTER.)
JUDGE DAVILA: NO, IT IS COOL.
MR. FLEURMONT: I JUST WANTED TO MAKE SURE I WAS CLEAR ON THAT. JUST TAKE A STEP BACK FROM THE PRIOR DISCUSSION, WHAT THE RULE REQUIRES IS A STATEMENT AGAINST INTEREST. THERE'S NO REQUIREMENT IN THAT RULE FOR SIMILAR MODE OF OPPORTUNITY TO CROSS-EXAMINE LIKE THERE IS IN 804(B)(1), AND THAT'S FOR A REASON TYPICALLY. AS I MENTIONED EARLIER TODAY, THESE STATEMENTS AGAINST INTEREST ARE SAID TO ANOTHER WITNESS OR SAID TO A POLICE OFFICER, AND THE OTHER PARTY ISN'T EVEN THERE. THE REASON THAT THEY'RE ALLOWED TO COME IN IS BECAUSE THEY'RE TYPICALLY RELIABLE BECAUSE THEY'RE STATEMENTS AGAINST THE PERSON'S INTEREST. THEY WOULDN'T MAKE THE STATEMENT IF THEY -- THEY WOULDN'T MAKE THE STATEMENT BECAUSE IT SUBJECTS THEM TO SOME SORT OF LIABILITY, WHETHER IT'S CIVIL OR CRIMINAL LIABILITY. AND WE SUBMIT, YOUR HONOR, THAT THAT'S WHAT HAPPENED HERE. I DO THINK THAT IT'S IMPORTANT TO NOTE THAT THESE ARE STATEMENTS MADE IN A DEPOSITION OF THE S.E.C. UNDER THE PENALTY OF PERJURY. THESE ARE NOT STATEMENTS MADE TO ANOTHER WITNESS, NOT STATEMENTS MADE TO A POLICE OFFICER. AND I'M NOT SAYING THAT THE CORROBORATION ELEMENT DOES NOT NEED TO BE MET BECAUSE OF THAT, BUT I THINK THAT'S SOMETHING THAT THE COURT SHOULD CONSIDER WHEN CONSIDERING IF THESE STATEMENTS ARE TRUSTWORTHY. THERE'S A WHOLE OTHER EXCEPTION THAT TALKS ABOUT STATEMENTS MADE IN DEPOSITIONS FOR A REASON. I THINK THAT'S -- YOU KNOW, YOU SWORN UNDER PERJURY, LIKE, YOU WANT TO BE HONEST. SO THERE IS THAT POINT. IN TERMS OF THE RULE 106 AND WHAT WE WANT TO ADMIT, GOING BACK TO JUST WHAT I SAID EARLIER, I THINK I'VE POINTED THE COURT TO THE PORTIONS THAT WE'RE SEEKING TO ADMIT. IF THE COURT WAS TO FASHION A LIMITED RULING THAT JUST HAD THOSE PORTIONS, THAT WOULD KIND OF GUIDE OUR 106 DESIGNATIONS.
JUDGE DAVILA: SURE. OKAY. UNDERSTOOD. OKAY. ALL RIGHT. WELL, IT USED TO BE AT PERIL OF ONE'S SOUL, REMEMBER THOSE DAYS, BUT NOW WE'VE MOVED IT TO PERILS OF PERJURY, SO --
MS. VOLKAR: YOUR HONOR, THE LAST THING I WANT TO SAY ON THE CORROBORATION AND THE TRUSTWORTHINESS POINT, BECAUSE I THINK THAT'S REALLY WHERE WE ARE FOCUSSING FOR THESE PIECES, THIS IS APPROXIMATELY A YEAR AFTER THE PARTIES SPLIT UP, AND WE DID HEAR TODAY AND YESTERDAY THAT THERE WAS A COMPLICATED RELATIONSHIP BETWEEN MS. HOLMES AND MR. BALWANI. THERE WERE LOVING ASPECTS AND NOT LOVING ASPECTS. BUT WE HAVEN'T YET HEARD FROM MR. BALWANI, TO BE FRANK, AND HIS SIDE OF THE STORY, AND WE -- AS FAR AS WE CAN TELL FROM THE TEXT MESSAGES, HE EXPRESSED A LOT OF LOVE AND DEVOTION. AND AGAIN, WITHOUT CROSS-EXAMINATION, WE DON'T KNOW WHAT INFLUENCE THAT WOULD HAVE HAD ON HIM IN THESE SITUATIONS. AND WE HAVE THE NINTH CIRCUIT SAYING A MOTIVE OF LOVE IS ANOTHER REASON TO TAKE A LITTLE BIT CLOSER LOOK AT CERTAIN STATEMENTS.
JUDGE DAVILA: I DID. I DID LOOK AT THAT, AND I LOOKED AT THAT IN RELATION TO THE TIMING AND IS THIS A SITUATION WHERE MR. BALWANI WOULD HAVE, BECAUSE OF THAT MOTIVATION, HIS FEELINGS FOR MS. HOLMES, HE MIGHT HAVE BEEN TRYING TO PROTECT HER IN SOME WAY, OR IN SOME WAY SHIELD HER? THAT'S A CONSIDERATION. I THINK IT'S MITIGATED BECAUSE OF THE TIMING HERE, BUT I THINK YOU'RE RIGHT TO POINT OUT THAT THERE'S SOME -- IT WAS A COMPLEX RELATIONSHIP I THINK IS WHAT YOU SAID, AND I THINK THE RECORD REFLECTS THAT. SO THANK YOU FOR THAT. OKAY. ALL RIGHT. THANK YOU. LET ME TURN TO 1165, WHICH WAS THE RENEWED MOTION TO ADMIT 14259. THIS IS REALLY ABOUT DR. ASIN IF I'M NOT MISTAKEN.
MS. VOLKAR: IT IS, YOUR HONOR. I WAS CURIOUS IF YOUR HONOR HAD A TENTATIVE RULING ON THE FINANCIAL MODELS OR IF IT WAS STILL UNDER SUBMISSION.
JUDGE DAVILA: I DO, BUT WHAT I'M GOING TO DO IS GIVE IT TO YOU PROBABLY TOMORROW BECAUSE I WANT TO LOOK, AND I'M GOING TO COMPARE THIS AND GO THROUGH THE TRANSCRIPTS, AND I'LL HAVE SOMETHING. BUT MY SENSE IS THAT I DON'T THINK ALL OF IT COMES IN, MR. FLEURMONT. I'M GOING TO LOOK AT THIS AND SEE WHAT PORTIONS. SO YOU CAN STOP READING THE TRANSCRIPTS, MS. VOLKAR. BUT I THINK I'M PROBABLY GOING TO GRANT THE MOTION AS TO SOME PORTIONS, BUT IT'S NOT GOING TO BE A WHOLESALE GRANT. I THINK THERE WILL BE SOME LIMITATIONS TO IT, IF I COULD TELL YOU THAT.
MR. FLEURMONT: UNDERSTOOD, YOUR HONOR.
MS. VOLKAR: THANK YOU, YOUR HONOR. VERY HELPFUL.
JUDGE DAVILA: YOU BET. AS TO 1165, LET ME JUST SAY THAT I'VE LOOKED AT THIS. MR. BOSTIC, I THINK YOU'RE RESPONSIBLE FOR THIS. THANK YOU FOR YOUR COMMENTS ON THIS. AS TO THE MOTION TO ADMIT THIS, I'VE LOOKED THIS OVER, CONSIDERED THE ARGUMENTS OF COUNSEL. I'M GOING TO ALLOW IT TO COME IN. I DO THINK THAT THERE WAS, THERE WAS TESTIMONY ABOUT DR. ASIN AND THE WITNESS TESTIFIED AS SHE DID ABOUT HER TEST RESULTS. I DID ALLOW THE GOVERNMENT TO GET IN CERTAIN EVIDENCE AND DOCUMENTS AS I THINK THE DEFENSE POINTS OUT HERE. I DO THINK IT'S APPROPRIATE TO ALLOW THIS TO COME IN. THERE IS A 401 THRESHOLD OF RELEVANCE THAT HAS BEEN MET. UNDER 403, I DO THINK THAT PROBATIVE VALUE OUTWEIGHS ANY PREJUDICIAL VALUE. THE PARTIES HAVE TALKED ABOUT THAT. SO I AM GOING TO GRANT THE MOTION AS TO THAT. THAT WILL BE ALLOWED TO COME IN. SO THANK YOU.
(DEFENDANT'S EXHIBIT 14259 WAS RECEIVED IN EVIDENCE.)
JUDGE DAVILA: YES, MR. BOSTIC?
MR. BOSTIC: IS THE COURT CONSIDERING WHETHER TO REDACT THAT ONE LINE WHERE IT SAYS THAT DR. ASIN -- I FORGET WHAT THE PHRASE IS, I DON'T HAVE IT IN FRONT OF ME. BUT DR. ASIN HAD NO PROBLEM WITH THE PROCESS.
JUDGE DAVILA: RIGHT.
MR. BOSTIC: MY CONCERN IS THAT MIGHT BE PORTRAYED AS THE DOCTOR HAVING NO CONCERNS ABOUT THE ACCURACY OF THE TEST OR THAT MIGHT CAUSE CONFUSION IN THE JURY.
JUDGE DAVILA: YEAH, FAIR QUESTION. SO WHEN I -- LET ME GET THE LANGUAGE. I THINK IT'S PROTOCOL. I THINK IT'S PROTOCOL. I THOUGHT ABOUT THAT, AND IN GRANTING THE MOTION, I THOUGHT THAT THESE LAWYERS ARE INTELLIGENT ENOUGH TO KNOW THAT WHEN THEY MAKE THEIR ARGUMENTS, IF THEY WISH, TO INFORM THE JURY THE DIFFERENCE BETWEEN TEST RESULTS AND A PROTOCOL. AND I THINK THAT -- I GUESS THAT'S MY ANSWER.
MR. BOSTIC: THANK YOU. I JUST WANT TO MAKE SURE THE COURT HAD CONSIDERED IT, YOUR HONOR. SUBMITTED.
JUDGE DAVILA: GREAT. ALL RIGHT. THANK YOU. ANYTHING FURTHER? THANK YOU VERY MUCH. THANK YOU. ANYTHING FURTHER BEFORE WE BREAK FOR THE DAY FROM EITHER TEAM?
MR. BOSTIC: NOT FROM THE GOVERNMENT, YOUR HONOR.
JUDGE DAVILA: OKAY. SO WE'LL SEE EACH OTHER NEXT, IS IT FRIDAY?
MR. DOWNEY: FRIDAY AT 9:00.
JUDGE DAVILA: OKAY. THANK YOU.
COURT CLERK: COURT IS ADJOURNED.
(COURT ADJOURNED AT 5:08 P.M.)