Final Instructions, Verdict Form, and CMS Evidence
300 linesSAN JOSE, CALIFORNIA DECEMBER 13, 2021 P R O C E E D I N G S
(COURT CONVENED AT 9:07 A.M.)
(JURY OUT AT 9:07 A.M.)
JUDGE DAVILA: THANK YOU. PLEASE BE SEATED. WE'RE ON THE RECORD IN THE HOLMES MATTER. ALL COUNSEL ARE PRESENT AND MS. HOLMES IS PRESENT. GOOD MORNING EVERYONE. WE'RE HERE TO DISCUSS SOME FINAL ISSUES ON THE INSTRUCTIONS, JURY INSTRUCTIONS. I DID RECEIVE YOUR SUBMISSIONS OVER THE WEEKEND. THANK YOU FOR THOSE. THEY WERE HELPFUL. THIS IS 1191 AND 1192, AND THAT RELATED TO THE 4621A AND B THAT WE HAD SOME CONVERSATIONS ABOUT. I KNOW THERE'S -- WE'LL TALK ABOUT THAT, AND THERE ARE A FEW OTHER INSTRUCTIONS ALSO THAT I THINK I ASKED YOU TO, AT LEAST ONE, TO MEET AND CONFER ABOUT, AND SOME OTHERS THAT I HAD TAKEN UNDER SUBMISSION. LET ME ASK THE PARTIES WHO ARE GOING TO SPEAK TO THESE, FIRST OF ALL, IS THERE ANYTHING YOU WOULD LIKE ME TO KNOW? MAYBE YOU'VE HAD SOME CONFERENCE AND REACHED SOME OTHER RESOLUTIONS, HE ASKED OPTIMISTICALLY? GOOD MORNING, MS. VOLKAR.
MS. VOLKAR: GOOD MORNING, YOUR HONOR. KELLY VOLKAR ON BEHALF OF THE UNITED STATES. MAY I REMOVE MY MASK?
JUDGE DAVILA: YES, AND MS. SAHARIA LIKEWISE. THANK YOU. GOOD MORNING.
MS. SAHARIA: THANK YOU, YOUR HONOR.
MS. VOLKAR: WHILE FRIDAY FEELS LIKE A LONG TIME AGO, I THINK, IF I UNDERSTOOD THE COURT'S QUESTION CORRECTLY, THE PARTIES DID MEET AND CONFER AT LEAST ABOUT THE TRADE SECRETS INSTRUCTION, AND I'LL LET MS. SAHARIA SPEAK TO THAT. MY UNDERSTANDING IS THAT THE DEFENSE WITHDREW ITS REQUEST IN THAT REGARD, AND I THINK THE REMAINDER OF THE MEET AND CONFER IS REFLECTED IN THE SUBMISSION WE SENT ON FRIDAY. BUT IF I'VE MISCHARACTERIZED ANYTHING, I'LL TURN IT OVER TO MS. SAHARIA.
JUDGE DAVILA: OKAY. THANK YOU. GOOD MORNING.
MS. SAHARIA: THAT'S CORRECT, YOUR HONOR. WE DID MEET AND CONFER WITH THE GOVERNMENT FOLLOWING COURT ON FRIDAY, AND THE RESULT OF THAT MEET AND CONFER IS REFLECTED IN THE DOCUMENT THAT I EMAILED MS. KRATZMANN ON FRIDAY EVENING. WE WERE ABLE TO REACH AGREEMENT WITH THE GOVERNMENT ON A NUMBER OF THE OUTSTANDING ISSUES, FOR EXAMPLE, THE ALLEGED VIOLATIONS OR REGULATIONS INSTRUCTION. SO EVERYTHING THAT IS IN THAT DOCUMENT THAT IS NOT HIGHLIGHTED, THE PARTIES EITHER REACHED AGREEMENT OR THE DOCUMENT SIMPLY REFLECTS THE COURT'S RULINGS AS REFLECTED ON THE RECORD FROM FRIDAY. THE ONLY ISSUES THAT WE UNDERSTOOD TO BE REMAINING FOR THE COURT'S RESOLUTION WERE THE ONES HIGHLIGHTED, AND MS. VOLKAR IS RIGHT THAT WE ELECTED TO WITHDRAW OUR REQUEST FOR A TRADE SECRET INSTRUCTION.
JUDGE DAVILA: OKAY.
MS. SAHARIA: I'M PREPARED TO ADDRESS THOSE INSTRUCTIONAL ISSUES, BUT MR. LEMENS IS GOING TO ADDRESS THE FILINGS WITH RESPECT TO THE CMS REPORT. SO IF YOUR HONOR WANTS TO START THERE?
JUDGE DAVILA: WELL, WHILE YOU'RE AT THE LECTERN, LET'S TALK ABOUT SOME OF THE OTHERS. I BELIEVE I HAVE THE PACKET THAT YOU SUBMITTED ON SATURDAY -- FRIDAY NIGHT, PARDON ME. JURY INSTRUCTION NUMBER 17, THIS IS WILLFULLY. I KNOW THE GOVERNMENT -- I NOTE THE NOTE BEGINNING ON LINE 6, THE GOVERNMENT OBJECTS TO THIS. THE COURT'S LANGUAGE THAT IT HAD TALKED ABOUT APPEARS AT LINES 3 AND 4, THAT SENTENCE. ANYTHING FURTHER ON THIS, MS. VOLKAR?
MS. VOLKAR: NO, YOUR HONOR. THE GOVERNMENT RESTS ON ITS PRIOR ARGUMENTS.
JUDGE DAVILA: ALL RIGHT. THANK YOU.
MS. SAHARIA: NOTHING FURTHER, YOUR HONOR.
JUDGE DAVILA: ALL RIGHT. THANK YOU. I'LL GIVE THIS, AS I INDICATED, LINES 3 AND 4, I'LL GIVE THIS OVER THE GOVERNMENT'S OBJECTIONS. INSTRUCTION 20. WE HAD DISCUSSION ABOUT IDENTIFYING THE INDIVIDUALS RELATED TO EACH CHARGE, AND I SEE INSTRUCTION 20 CAPTURES THAT.
MS. SAHARIA: YES, WE DO OBJECT TO THIS. PROVING THE WIRES IS AN ELEMENT OF THE GOVERNMENT'S BURDEN OF PROOF. IT DOES BEAR THAT BURDEN OF PROOF TO PROVE THE WIRES BEYOND A REASONABLE DOUBT. THAT INCLUDES PROVING THE FACT OF THE WIRES AND WHO THEY RELATE TO, THAT THEY WERE THERANOS INVESTORS. IT'S OUR POSITION THAT ADDING THESE NAMES INTO THE INSTRUCTIONS TO THE JURY IMPROPERLY RELIEVES THE GOVERNMENT OF PART OF ITS BURDEN OF PROOF TO PROVE THESE WIRES BEYOND A REASONABLE DOUBT, AND FOR THAT REASON IT WOULD BE IMPROPER TO PUT THEM IN THE INSTRUCTIONS.
JUDGE DAVILA: ALL RIGHT. THANK YOU.
MS. VOLKAR: YOUR HONOR, I THINK IT -- THE GOVERNMENT'S POSITION IS THAT THIS IS SIMPLY IDENTIFYING FOR THE JURY TO MAKE IT A LITTLE BIT EASIER THAN JUST THE DOLLAR FIGURES, WHICH COUNT RELATES TO WHICH INVESTOR VICTIM WHO TESTIFIED. I BELIEVE AT THE OUTSET THE INSTRUCTIONS SAY THE GOVERNMENT MUST PROVE ALL ASPECTS BEYOND A REASONABLE DOUBT. I DO NOT BELIEVE IT RELIEVES THE GOVERNMENT OF ANY BURDEN.
JUDGE DAVILA: THANK YOU. IS THERE CONCERN, MS. SAHARIA, THAT THE JURY MIGHT LOOK AT THE DECEMBER 30TH ALLEGATIONS REGARDING MR. EISENMAN AND SOMEHOW CONFUSE THAT WITH THE COUNT 7, THE 99 MILLION RELATING TO DYNASTY? IS THAT PART OF YOUR CONCERN?
MS. SAHARIA: NO. MY CONCERN IS SIMPLY THAT THE GOVERNMENT BEARS THE BURDEN TO PROVE THESE ALLEGATIONS AND THESE NAMES DO NOT APPEAR IN THE INDICTMENT. ONLY THE DATES AND THE DOLLAR FIGURES APPEAR IN THE INDICTMENT. SO IT'S THE GOVERNMENT'S BURDEN TO ARGUE TO THE JURY IN CLOSING THAT THE EVIDENCE PROVED THESE WIRES. I ASSUME PART OF THAT WILL BE SHOWING ITS PROOF TO THE JURY AS TO WHICH WIRES RELATE TO WHICH INDIVIDUALS. THAT'S WHAT THEY WILL DO IN CLOSING ARGUEMENT. I JUST DON'T THINK IT'S APPROPRIATE FOR THE COURT TO BE DOING THAT FOR THE GOVERNMENT TO MAKE IT EASIER FOR THEM. MS. VOLKAR USED THE WORD "EASIER." THAT'S OUR CONCERN, THIS MAKES IT EASIER FOR THE GOVERNMENT TO PROVE ITS CASE BEYOND A REASONABLE DOUBT WHEN INFORMATION THAT IS NOT IN THE INDICTMENT THAT IS PART OF ITS BURDEN OF PROOF IS ADDED TO THE JURY INSTRUCTIONS.
JUDGE DAVILA: IS IT YOUR CONCERN THAT IF THE COURT GIVES THIS INSTRUCTION, IT GIVES ITS IMPRIMATUR THAT THE JURY SHOULD FIND EACH OF THESE --
MS. SAHARIA: YES, EXACTLY.
JUDGE DAVILA: -- FOR EACH OF THE VICTIMS INDICATED? IS THAT YOUR CONCERN?
MS. SAHARIA: THAT IS OUR CONCERN, THAT IT'S THE GOVERNMENT'S BURDEN AND THE COURT SHOULD NOT BE HELPING THE GOVERNMENT MEET THAT BURDEN.
JUDGE DAVILA: WELL, I THINK I MAY HAVE SUGGESTED THIS. I'M NOT SURE IF THE GOVERNMENT DID, BUT I SUGGESTED THIS AS A WAY TO ASSIST, TO HELP THE JURY -- NOT TO HELP THE GOVERNMENT, NOT TO HELP THE DEFENSE -- BUT RATHER TO INFORM THE JURY AS TO WHICH OF THESE ALLEGATIONS RELATED TO WHICH COUNT. I THINK WE HAD TALKED ALSO ABOUT PROVIDING THE JURY WITH ANOTHER DOCUMENT THAT CONTAINED ALL OF THIS INFORMATION. WHAT HAS HAPPENED TO THAT?
MS. SAHARIA: SO WE HAD TALKED ABOUT THE POTENTIAL OF GIVING THE JURY A REDACTED INDICTMENT. WE HAVE GONE BACK AND LOOKED AT THE INDICTMENT. WE DON'T SEE A WAY TO FEASIBLY REDACT THE INDICTMENT. THAT DOESN'T GIVE THE JURY GOVERNMENT ARGUMENT IN THE INDICTMENT. IT'S OUR POSITION THAT THE INSTRUCTIONS AS THEY'RE CURRENTLY WORDED GIVES THE JURY THE CORE INFORMATION WITH RESPECT TO WHAT IS THE OBJECT OF BOTH SCHEMES AND CONSPIRACIES, THE RELEVANT DATES, AND THE DATES OF THE WIRES. AND THEN PRESUMABLY THE PARTIES WILL ARGUE TO THE JURY IN CLOSING THE MISREPRESENTATIONS THAT ARE ALLEGED IN THE INDICTMENT. SO IT'S OUR POSITION THAT NO FURTHER DOCUMENT NEEDS TO GO BACK TO THE JURY.
JUDGE DAVILA: WELL, I THINK THIS IS A SWITCH IN YOUR POSITION, OR YOUR TEAM'S POSITION. YOU HAD ADVOCATED PREVIOUSLY THAT A DOCUMENT THAT INFORMS FULSOME SHOULD BE PROVIDED TO THE JURY TO ASSIST THEM. I AGREED WITH THAT, AND THAT'S WHY I THOUGHT A REDACTED VERSION, A SOMEHOW MODIFIED VERSION OF THE INDICTMENT WOULD BE HELPFUL.
MS. SAHARIA: THAT'S RIGHT, YOUR HONOR. I THINK I SAID AT THAT FIRST CONFERENCE THAT I WANTED TO CONFER WITH MY TEAM ABOUT WHETHER WE THOUGHT IT COULD WORK TO REDACT THE INDICTMENT, AND WE DID GO BACK AND LOOK AT THE INDICTMENT. AND WE DON'T SEE A GOOD WAY TO DO THAT, TO GIVE -- THAT WOULDN'T GIVE THE JURY IMPROPER ARGUMENT FROM THE GOVERNMENT. AS YOUR HONOR KNOWS, IT'S A SPEAKING INDICTMENT. IT CONTAINS, YOU KNOW, LOTS OF ALLEGATIONS THROUGHOUT THE INDICTMENT. AND SO WE JUST DIDN'T SEE A GOOD WAY TO DO THAT. SO WE DO THINK THAT AT THE TIME THAT WE FIRST MET, SOME OF THE LANGUAGE THAT IS NOW IN THESE INSTRUCTIONS WITH RESPECT TO THE OBJECTS OF THE VARIOUS SCHEMES WERE NOT IN THE DRAFT FROM THE GOVERNMENT. THEY HAVE NOW AGREED TO ADD THAT INFORMATION. SO I DO THINK THAT THIS IS NOW A MORE FULSOME DOCUMENT THAT ARTICULATES THE DATES, THE OBJECTS OF THE SCHEMES AND CONSPIRACIES, WHICH ONES RELATE TO PATIENTS, PAYING PATIENTS, WHICH ONES RELATE TO INVESTORS. SO I DO THINK THAT THERE IS SIGNIFICANTLY MORE INFORMATION IN THIS NOW THAN THERE WAS WHEN WE FIRST MET TWO FRIDAYS AGO.
JUDGE DAVILA: ALL RIGHT. THANK YOU. IT WAS MY INTENTION, IF THE JURY WOULD RECEIVE AN INDICTMENT, TO NOT GIVE THEM THE ENTIRETY OF THE INDICTMENT THAT HAD ALL OF THE SUMMATION OF THE FACTS AND THE ALLEGATIONS, BUT RATHER JUST THE CHARGING PORTION. THAT'S WHAT I THOUGHT YOU WOULD WORK ON. IS THAT WHAT YOU WORKED ON, AS OPPOSED TO ALL OF THE PRELIMINARY LANGUAGE?
MS. SAHARIA: BY "CHARGING PORTION," DO YOU MEAN JUST THE COUNTS AT THE END, YOUR HONOR?
JUDGE DAVILA: YES, WITHOUT THE LANGUAGE, THE PREFATORY LANGUAGE.
MS. SAHARIA: WE WERE LOOKING AT THE LANGUAGE OF THE ALLEGED MISREPRESENTATIONS, WHICH LARGELY IS IN PARAGRAPH 12, AND THEN I THINK PRIMARILY PARAGRAPH 16 AS IT RELATES TO THE PATIENTS. AND THAT'S WHAT WE WERE CONCERNED ABOUT, THAT WE DIDN'T SEE A GOOD WAY TO GIVE THOSE PARAGRAPHS TO THE JURY WITHOUT KIND OF EXPOSING THEM TO WHAT WE VIEW AS IMPROPER ARGUMENT IN THE INDICTMENT. THE COUNTS, I THINK, PROBABLY ARE LESS OBJECTIONABLE, BUT I WOULD WANT TO GO BACK AND LOOK AT THAT ONE MORE TIME.
JUDGE DAVILA: OKAY. MS. VOLKAR?
MS. VOLKAR: THE GOVERNMENT'S POSITION REMAINS THAT THE COURT COULD READ OR GIVE THE INDICTMENT TO THE JURY. WHEN WE SPOKE ABOUT THIS BEFORE, I BELIEVE THE DEFENSE RAISED CONCERNS ABOUT A POTENTIAL VARIANCE, AND THE BEST WAY TO AVOID A VARIANCE IS TO READ THE INDICTMENT. THE GOVERNMENT SEES NOTHING IMPROPER WITH THAT, BUT ALSO SUBMITS THAT THE JURY INSTRUCTIONS THAT THE PARTIES HAVE AGREED ON THUS FAR DO LAY OUT EACH OF THE INDIVIDUAL COUNTS IN A MANNER THAT, IF THE DEFENSE STRONGLY OBJECTS TO PROVIDING THE INDICTMENT, WE DON'T THINK IT'S NEEDED GIVEN THE CURRENT STATE OF THE INSTRUCTIONS. I DO WANT TO LOOP BACK TO THE NAMES OF THE VICTIMS.
JUDGE DAVILA: YES.
MS. VOLKAR: I GO BACK TO THE COURT'S POINT THAT ADDING THE NAMES OF THE INVESTOR VICTIMS IS REALLY JUST TO ASSIST THE JURORS. I DO NOT BELIEVE THERE IS ANY CONTESTING FROM THE DEFENSE WHICH WIRE RELATES TO WHICH VICTIM. ADDING THE NAME IS REALLY JUST A TOOL FOR THE JURY TO BE ABLE TO LINK UP A DOLLAR FIGURE WITH THE VICTIM THAT TESTIFIED ABOUT IT, AND OF COURSE THEY'LL HAVE THE WIRE ITSELF WHICH LISTS THE VICTIM. I'M SORRY. I DON'T HAVE THE EXHIBIT NUMBER OFF THE TOP OF MY HEAD, BUT THAT'S WHAT I LOOKED AT WHEN I ADDED THE VICTIMS' NAMES HERE. SO THAT'S WHY I ASSERT THAT IT'S NOT LESSENING THE GOVERNMENT'S BURDEN OF PROOF, IT REALLY IS JUST TO ASSIST THE JURY, AND I BELIEVE IT'S A FACT THAT IS NOT IN CONTENTION. I DON'T THINK THE DEFENSE IS GOING TO ARGUE IN CLOSING ARGUMENTS THAT THE 5 MILLION WIRED BY PERSON X WAS ACTUALLY BY PERSON Y ON THAT DATE.
JUDGE DAVILA: THANK YOU. THANK YOU. I'M TRYING TO SEE HOW THIS PREJUDICES YOU. AND, MS. SAHARIA, I THINK YOU'RE SAYING THAT, WELL, THEY HAVE TO PROVE THAT THE 990 CAME TO MR. EISENMAN.
MS. SAHARIA: CAME FROM MR. EISENMAN.
JUDGE DAVILA: RIGHT. BUT IT SAYS RELATING TO, IT DOESN'T SAY -- DOESN'T THAT CHANGE IT? IT DOESN'T --
MS. SAHARIA: I DON'T THINK SO, YOUR HONOR. THE FACT THAT WE DON'T CONTEST WHICH WIRES RELATE TO WHICH INDIVIDUALS DOESN'T MATTER BECAUSE, AGAIN, WE'RE THE DEFENDANT. WE HAVE NO BURDEN TO CONTEST ANYTHING. THE GOVERNMENT HAS THE BURDEN TO PROVE EVERY ELEMENT BEYOND A REASONABLE DOUBT, EVEN IF WE DON'T CONTEST ANYTHING. SO THE GOVERNMENT, I ASSUME, WILL MAKE A CHART AND IT WILL SHOW THE CHART TO THE JURY IN CLOSING AND THE CHART WILL LINK ITS EVIDENCE AND WILL SHOW THE JURY ITS EVIDENCE AND WILL LINK THE AMOUNTS TO THE VICTIMS, AND THAT'S PROPER CLOSING ARGUMENT AND THE JURY CAN TAKE NOTES. BUT THAT'S THE GOVERNMENT'S BURDEN. THE COURT SHOULDN'T BE DOING THE GOVERNMENT'S WORK FOR IT IN THE INSTRUCTIONS. SO I'LL JUST REST ON THAT.
JUDGE DAVILA: ALL RIGHT. ANYTHING FURTHER?
MS. VOLKAR: JUST THAT THE INSTRUCTIONS SAY THAT THE GOVERNMENT MUST PROVE EVERYTHING BEYOND A REASONABLE DOUBT. AND WITH THAT, THE GOVERNMENT RESTS.
JUDGE DAVILA: THANK YOU. I DO THINK THAT IDENTIFYING THESE IN THE INSTRUCTIONS IS MORE HELPFUL TO THE JURY. I REALLY DO. I DON'T SEE THE PREJUDICE. I UNDERSTAND, MS. SAHARIA, YOUR POINT THAT, WELL, THE GOVERNMENT HAS TO CONNECT THESE UP, AND IF THEY WANT TO DO IT, THEY CAN DO IT IN THEIR CHART ON A POWERPOINT. YOU HAVE CONCERN, YOU HAVE GRAVE CONCERN THAT SOMEHOW THIS MEANS THAT THE COURT IS ASSISTING THE GOVERNMENT IN THEIR PROSECUTION. ALL RIGHT. I WILL NOT GIVE THESE. AND THE GOVERNMENT CAN IDENTIFY THESE AS THEY WISH IN THEIR CLOSING ARGUMENT, AND THE JURY WILL BE TASKED TO SEE IF THE GOVERNMENT MET THEIR BURDEN AS TO EACH OF THESE COUNTS. ALL RIGHT?
MS. SAHARIA: THANK YOU, YOUR HONOR.
JUDGE DAVILA: PAGE 23, LINE 19, THERE'S -- I THINK YOU OBJECT TO THAT SENTENCE, MS. SAHARIA?
MS. SAHARIA: I'M SORRY, LINE 4?
JUDGE DAVILA: I'M ON PAGE 23, THE SAME INSTRUCTION.
MS. SAHARIA: OH, I'M SORRY. YES, YES, I WAS LOOKING AT INSTRUCTION 23. APOLOGIES, YOUR HONOR. YES, WE HAD THIS DISCUSSION LAST WEEK. THE GOVERNMENT HAD PROPOSED A PARAGRAPH ON THIS TOPIC WHICH THE COURT SAID IT WOULDN'T GIVE. THE GOVERNMENT IS NOW PROPOSING THIS LINE. AGAIN, THERE'S NO NEED FOR THE SENTENCE. IT'S NOT GOING TO -- THE JURY WILL NOT BE CONFUSED ABOUT THIS POINT. THE WIRES IN THIS CASE, THE MAJORITY OF THEM ARE JUST WIRING MONEY. SO I JUST DON'T SEE HOW THE JURY COULD POSSIBLY BE CONFUSED THAT THE WIRE NEEDS TO BE FALSE OR MISLEADING IF THE WIRE IS MONEY. WE'RE NOT GOING TO ARGUE TO THE JURY THAT THE WIRE NEEDS TO BE FALSE OR MISLEADING. I JUST DON'T SEE THE POINT OF THE SENTENCE.
JUDGE DAVILA: OKAY.
MS. SAHARIA: AND IT'S NOT A MODEL INSTRUCTION.
JUDGE DAVILA: OKAY.
MS. VOLKAR: YOUR HONOR, THIS WAS BECAUSE OF THE DISCUSSION BETWEEN THE COURT AND MR. LEACH LAST FRIDAY, WHICH IS THE POINT THE GOVERNMENT WAS TRYING TO CONVEY WITH THE PRIOR PARAGRAPH WAS A STATEMENT OF THE LAW. WE UNDERSTAND IF THE COURT WANTS TO GIVE THE MODEL INSTRUCTION, BUT WE DID WANT TO PROPOSE THE SENTENCE THAT GOT MORE TO THE HEART OF WHAT WE WERE TRYING TO SAY.
JUDGE DAVILA: MS. VOLKAR, IF I GIVE THIS, DOES IT LEND ANY CONFUSION, DO YOU THINK? DOES THIS ADD TO CONFUSION? EXCUSE ME.
MS. VOLKAR: I DO NOT BELIEVE SO. I THINK IT IS A CLEAR STATEMENT OF THE LAW AND IT MAKES CLEAR -- NOT EVERYBODY IS FAMILIAR WITH WIRE FRAUD, AND IT MAKES CLEAR THAT WIRE ITSELF DOES NOT HAVE TO BE FRAUDULENT OF MISREP -- MISLEADING. EXCUSE ME.
JUDGE DAVILA: SO TELL ME -- REMIND ME AGAIN WHAT THIS MEANS, EXCUSE ME, WHAT THIS MEANS, "THE WIRE ITSELF NEED NOT BE FALSE OR MISLEADING." WHAT DOES THAT INFORM THE JURY?
MS. VOLKAR: I THINK WE HAVE SEEN CASE LAW WHERE THE -- WHAT IS SENT IN THE MAIL IS, FOR EXAMPLE, A FRAUDULENT ADVERTISEMENT. AND I THINK THIS IS A CASE WHERE THE WIRE IS RELATING TO OR IN FURTHERANCE OF THE SCHEME WHERE, AS MS. SAHARIA POINTED OUT, SEVERAL OF THE INVESTORS ARE SIMPLY WIRING MONEY, OR IN ONE INSTANCE A PATIENT CALLED TO TALK ABOUT A BLOOD TEST RESULT, RATHER THAN NECESSARILY RECEIVING THE INACCURATE RESULT BY FAX AS A DIFFERENT PATIENT DID. SO I THINK IT'S JUST TRYING TO CLEAR UP FOR THE JURY THAT WHILE IN SOME INSTANCES THE WIRE MAY ITSELF BE THE FRAUDULENT DOCUMENT, THAT'S NOT TRUE IN ALL CASES, AND IT'S NOT THE GOVERNMENT'S BURDEN TO PROVE THAT UNDER THE LAW OF THE NINTH CIRCUIT.
JUDGE DAVILA: OKAY. MS. SAHARIA?
MS. SAHARIA: THE INSTRUCTION INFORMS THE JURY AS TO WHAT THE WIRING ELEMENT IS. THAT'S THE FOURTH ELEMENT AT LINES 14 TO 15. THAT IS THE MODEL INSTRUCTION. THE WIRE SIMPLY NEEDS TO BE USED TO CARRY OUT OR ATTEMPT TO CARRY OUT AN ESSENTIAL PART OF THE SCHEME. THIS LINE IS JUST THE GOVERNMENT ARGUMENT ABOUT THE WIRING ELEMENT. AND AGAIN, THERE'S JUST NO POTENTIAL FOR THE JURY TO BE CONFUSED HERE GIVEN WHAT THE GOVERNMENT HAS CHARGED AS THE WIRES. I DON'T SEE THE NEED FOR THIS SENTENCE.
JUDGE DAVILA: MS. VOLKAR, I THINK IF I'M GOING TO GIVE THIS, I THINK IT SHOULD BE GIVEN FOLLOWING THE END OF THE SENTENCE IN THE FOURTH AS MS. SAHARIA POINTS OUT. IT SEEMS THAT IF IT WOULD BE GIVEN, IT WOULD FLOW BETTER THERE IF I MOVED IT TO FOLLOW THE WORD "SCHEME."
MS. VOLKAR: THAT WOULD BE FINE, YOUR HONOR.
JUDGE DAVILA: SO I'LL GIVE THIS AND I'LL MOVE IT TO THAT LOCATION FOLLOWING THE WORD "SCHEME" IN THE FOURTH -- IT'S ON LINE 14, PAGE 23 OF THE SUBMISSION. AND I'LL NOTE YOUR OBJECTIONS, MS. SAHARIA.
MS. SAHARIA: THANK YOU.
JUDGE DAVILA: KNOWINGLY IS INSTRUCTION 23, AND MR. WADE'S FAVORITE CASE, PHILLIPS, IS CITED HERE.
MS. SAHARIA: YES, YOUR HONOR.
JUDGE DAVILA: RIGHT. AS ARE THE MODEL INSTRUCTIONS.
MS. SAHARIA: CORRECT.
JUDGE DAVILA: SO WE HAVE SOME TENSION BETWEEN THOSE TWO CONCEPTS. MS. SAHARIA, WHAT SHOULD BE GIVEN?
MS. SAHARIA: WELL, I DON'T THINK THERE'S ANY TENSION BETWEEN THE TWO CONCEPTS. THE FIRST PARAGRAPH IS THE MODEL INSTRUCTION. THE SECOND PARAGRAPH IS AN INSTRUCTION THAT IS TAILORED TO THE FACTS OF THIS CASE WHERE THE GOVERNMENT HAS PUT INTO EVIDENCE LARGE SWATHS OF EVIDENCE ABOUT INFORMATION THAT NEVER WENT TO MS. HOLMES. ONE OF ITS FIRST WITNESSES, FOR EXAMPLE, WAS ERIKA CHEUNG, WHO TESTIFIED ABOUT HER CONCERNS IN THE LAB THAT SHE NEVER ONCE COMMUNICATED TO MS. HOLMES. SO GIVEN THE WAY THAT THE GOVERNMENT HAS PROVED ITS CASE, WE THINK IT'S VERY IMPORTANT FOR THE JURY TO UNDERSTAND THAT IT IS NOT PERMITTED TO IMPUTE KNOWLEDGE FROM OTHER THERANOS EMPLOYEES, FROM ALLEGED -- AN ALLEGED COCONSPIRATOR, FROM ALLEGED AGENTS OF MS. HOLMES. THAT'S BLACK LETTER LAW. THE PHILLIPS CASE SQUARELY HOLDS THAT. SO WE THINK GIVEN THE FACTS OF THIS CASE, IT'S VERY IMPORTANT FOR THE JURY TO HEAR THAT INSTRUCTION. THERE'S NO TENSION BETWEEN THAT AND WHAT IT MEANS TO ACT KNOWINGLY. THIS IS SIMPLY EXPLAINING TO THE JURY THAT TO ACT KNOWINGLY, MS. HOLMES HERSELF NEEDS TO BE AWARE OF THE RELEVANT FACTS AND THE JURY CAN'T IMPUTE ANYONE ELSE'S KNOWLEDGE TO HER.
JUDGE DAVILA: THANK YOU. WHAT ABOUT OMISSION? SHOULD THAT REMAIN HERE ON LINE 5?
MS. SAHARIA: I DON'T BELIEVE SO, YOUR HONOR. THIS GOES TO THE POINT THAT WE WERE DISCUSSING LAST WEEK. THE GOVERNMENT DID AGREE TO DROP ITS OMISSIONS AND DUTY TO DISCLOSE THEORY. THE WORD "OMISSIONS" HAS BEEN REMOVED FROM THE REMAINDER OF THE INSTRUCTIONS. AS I UNDERSTAND IT FROM MR. LEACH LAST WEEK, IT'S HIS VIEW THAT THE WORD "OMISSIONS" HERE STILL BELONGS HERE BECAUSE THIS IS NOT DIRECTLY IMPLICATING THE DUTY TO DISCLOSE. BUT I THINK, GIVEN THAT THERE'S NO DUTY TO DISCLOSE THEORY IN THIS CASE ANYMORE, THE WORD "OMISSIONS" WILL CONFUSE THE JURY. I'M NOT EVEN SURE HOW THE JURY COULD INFER KNOWLEDGE FROM AN OMISSION UNLESS THERE WAS A DUTY TO DISCLOSE. I DON'T EVEN KNOW WHAT THE PURPOSE OF THAT WORD IS IN THIS SENTENCE, AND I'M CONCERNED THAT IT WILL SUGGEST TO THE JURY THAT MS. HOLMES DID HAVE SOME DUTY TO DISCLOSE INFORMATION THAT WAS OMITTED. I JUST, I THINK IT'S HIGHLY MISLEADING HERE AND SHOULD BE ELIMINATED.
JUDGE DAVILA: OKAY. THANK YOU. AND WHAT IS YOUR VIEW ON THE COURT GIVING BOTH OF THESE?
MS. SAHARIA: I THINK IF THE COURT IS GOING TO GIVE THE FIRST PARAGRAPH, WE WOULD ASK THAT THE COURT ADD THE SECOND PARAGRAPH SO THAT THEY BOTH BE GIVEN TOGETHER.
JUDGE DAVILA: ALL RIGHT. THANK YOU. MS. VOLKAR?
MS. VOLKAR: YOUR HONOR, THERE IS TENSION BETWEEN THE MODEL INSTRUCTION AND THE PHILLIPS INSTRUCTION. AND AS THE GOVERNMENT POINTED OUT LAST WEEK, PHILLIPS IS A CASE FROM 1965. IT'S BEEN AROUND FOR A LONG TIME. AS FAR AS I KNOW, IT'S OFTEN CITED BY CRIMINAL DEFENDANTS, YET IT HAS NEVER MADE ITS WAY INTO THE MODEL INSTRUCTIONS, NOT EVEN AS BRACKETED LANGUAGE, AND I THINK THAT REALLY SHOULD INFORM YOUR HONOR'S RULING HERE. THE KNOWINGLY STANDARD IS WELL DEFINED. IT'S DEFINED IN THE MODEL. IT ENCOMPASSES THE CONCEPTS THAT THEY'RE TRYING TO ADD THROUGH THE PHILLIPS CASE. AND THE DEFENSE, OF COURSE, CAN MAKE THESE ARGUMENTS IN THEIR CLOSING ARGUMENT, BUT IT DOESN'T HAVE ANY PLACE IN THE COURT'S INSTRUCTIONS BECAUSE, FOR EXAMPLE, THE FIRST SENTENCE SAYS, "AN ACT IS DONE KNOWINGLY IF MS. HOLMES IS AWARE." NOW, SHE COULD BE AWARE OF INFORMATION THAT SHE LEARNS FROM HER COCONSPIRATOR, THAT SHE LEARNS FROM MR. BALWANI WITH RESPECT TO WHAT ERIKA CHEUNG TOLD HIM.
AND I DO THINK THAT THERE IS EVIDENCE IN THIS CASE THAT THERE WAS AT LEAST SOME COMMUNICATION ON THAT FRONT. SO JUST BECAUSE ERIKA CHEUNG DID NOT NECESSARILY TALK TO MS. HOLMES DIRECTLY, THERE IS OTHER EVIDENCE THAT, FOR EXAMPLE, SHE KNEW TYLER SHULTZ TALKED TO MS. HOLMES DIRECTLY, AND, OF COURSE, MS. HOLMES TESTIFIED ABOUT THAT. AND THERE WAS COPIOUS CONVERSATION BETWEEN MS. HOLMES AND HER COCONSPIRATOR. SO I THINK IT'S MISLEADING TO INCLUDE THE PHILLIPS INSTRUCTION HERE, THAT THE JURY HAS TO PUT BLINDERS ON AND NARROW ITS FOCUS IN TERMS OF WHAT IT'S ALLOWED TO INCLUDE. AND I WANT TO GO BACK TO WHAT THE PHILLIPS CASE ACTUALLY SAYS. THE PHILLIPS CASE WAS AN EVIDENTIARY RULING, WHETHER OR NOT DOCUMENTS SHOULD BE ADMITTED THAT ONE COCONSPIRATOR NEVER SAW, AND I BELIEVE THAT WAS ONE OF THOSE CASES WHERE THE DOCUMENT ITSELF WAS A VEHICLE OF THE FRAUD. AND ONE OF THE COCONSPIRATORS NEVER SAW THE OTHER -- THE DOCUMENT, THE LETTER THAT THE OTHER COCONSPIRATOR ACTUALLY SENT.
AND THE QUESTION BEFORE THE NINTH CIRCUIT IN THE DISTRICT COURT IN THAT CASE WAS WHETHER OR NOT THE DOCUMENT THAT THE COCONSPIRATOR NEVER SAW SHOULD BE ADMITTED IN THE CASE OF THE DEFENDANT WHO HAD NEVER SEEN THE DOCUMENT. YOUR HONOR RELIED ON THIS CASE, THE PHILLIPS CASE, IN REJECTING THE GOVERNMENT'S PROFFER OF THE STACK OF NEGATIVE COMPLAINTS ABOUT ACCURACY AND RELIABILITY THAT WAS SENT TO MR. BALWANI, BUT NOT SENT TO MS. HOLMES. YOUR HONOR HAS BEEN FOLLOWING THE PHILLIPS CASE ALL ALONG. AND IT JUST SIMPLY HAS NOTHING TO DO WITH INSTRUCTIONAL ERROR, IT HAS NOTHING TO DO WITH INSTRUCTIONS, IT'S NOT IN THE MODEL INSTRUCTIONS FOR A REASON AFTER MORE THAN 50 YEARS, AND THERE'S NO REASON TO GIVE IT NOW. AND I'M ALSO HAPPY TO RESPOND TO THE OMISSIONS POINT.
JUDGE DAVILA: YES, PLEASE.
MS. VOLKAR: SO WE DID, THROUGH MEET AND CONFER, AGREE TO DROP THE OMISSIONS FROM THE MIDDLE SENTENCE, THE SECOND SENTENCE, BECAUSE WE BELIEVED THAT WAS TIED TO THE OMISSIONS THEORY. I THINK IT'S AGAIN NOTEWORTHY THAT IN THE LAST SENTENCE OF THE MODEL, "OMISSIONS" IS NOT IN BRACKETS. AND THAT'S BECAUSE WHEN WE'RE TALKING ABOUT WHAT A DEFENDANT KNOWS OR IS AWARE OF, THAT IS A BROADER STANDARD. YOU CAN ENCOMPASS EVERYTHING THAT IS WITHIN THAT PERSON'S KNOWLEDGE AND WHEELHOUSE, WHETHER IT WAS TOLD TO THEM BY COCONSPIRATORS, WHETHER IT WAS SHOWED TO THEM THROUGH DOCUMENTS, HOW THEY CAME TO BE AWARE OF IT. THAT DOES RELATE TO THE KNOWINGLY STANDARD, AND THAT MAY INCLUDE OMISSIONS. THAT MAY INCLUDE FORWARDING AN EMAIL WITH THE "FORTUNE" ARTICLE AND NOT POINTING OUT THAT IT HAS INACCURATE STATEMENTS IN IT. THAT ALL CAN BE ENCOMPASSED IN WHAT A DEFENDANT KNOWS. IT'S A BROADER STANDARD FOR THE JURY TO CONSIDER WHAT ONE PERSON IS AWARE OF WHEN WE'RE TALKING ABOUT THE MENS REA FOR A CRIMINAL OFFENSE. IT'S NOT AN OMISSIONS THEORY. IT'S NOT TIED TO A FIDUCIARY DUTY. IT'S JUST THE WHOLE MIX OF INFORMATION THAT GOES TO A DEFENDANT'S STATE OF MIND.
JUDGE DAVILA: AND THE GOVERNMENT IS NOT GOING TO ARGUE -- BY WITHDRAWING YOUR ADMISSIONS IN THE OTHER INSTRUCTIONS, YOU'VE INDICATED THAT YOU'RE NOT GOING TO ARGUE AN OMISSIONS THEORY IN YOUR CASE.
MS. VOLKAR: THAT'S CORRECT, YOUR HONOR.
MS. SAHARIA: I WOULD JUST NOTE THAT MS. VOLKAR'S ARGUMENT ON THE PHILLIPS LANGUAGE SHOWS EXACTLY WHY THIS INSTRUCTION IS NECESSARY. I'M NOT AWARE OF ANY EVIDENCE THAT IN REALTIME MR. BALWANI INFORMED MS. HOLMES OF WHAT MS. CHEUNG SAID. AND MS. VOLKAR SUGGESTED THAT THE JURY COULD INFER THAT COMMUNICATION OCCURRED SIMPLY FROM THE FACT THAT THEY'RE ALLEGED COCONSPIRATORS. THAT'S EXACTLY WHAT PHILLIPS PROHIBITS AND THAT'S EXACTLY WHY THIS INSTRUCTION SHOULD BE GIVEN TO THE JURY.
JUDGE DAVILA: WELL, YOU'RE AWARE, I THINK, THAT MS. VOLKAR'S MEMORY OF THE FACTS OF PHILLIPS IS ACCURATE. IT WAS REALLY ABOUT DOCUMENTS. IT WAS LETTERS AND IT WAS THE LAND FRAUD CASE, AND I THINK THEY ENGAGED A -- THE DEFENDANTS ENGAGED AN ADVERTISING COMPANY TO ASSIST IN THEIR FRAUD, SENDING THESE DOCUMENTS OUT. WASN'T THAT THE ISSUE THERE, THE LETTERS?
MS. SAHARIA: THAT'S RIGHT. THE ISSUE THERE WAS WHETHER INFORMATION, IN THAT CASE DOCUMENTS THAT WERE KNOWN TO ONE COCONSPIRATOR, COULD BE -- WHETHER THE COCONSPIRATOR'S KNOWLEDGE OF THOSE DOCUMENTS COULD BE IMPUTED TO THE OTHER ALLEGED COCONSPIRATOR, AND THE NINTH CIRCUIT SAID, NO, IT COULD NOT. THAT'S THE SAME POINT THAT WE'RE MAKING HERE, WHICH IS TO THE EXTENT THAT MR. BALWANI RECEIVED INFORMATION FROM THERANOS EMPLOYEES, BUT THAT INFORMATION WAS NOT COMMUNICATED TO MS. HOLMES, IT IS IMPROPER FOR THE JURY TO INFER THAT MS. HOLMES HAS KNOWLEDGE OF THAT INFORMATION SIMPLY BECAUSE THE GOVERNMENT IS ALLEGING THEM TO BE COCONSPIRATORS. IT'S THE EXACT SAME PRINCIPLE. THE FACT THAT WE HAVE HAD SO MUCH EVIDENCE IN THIS CASE ALONG THESE LINES OF THINGS THAT WERE NOT COMMUNICATED TO MS. HOLMES I THINK SHOWS WHY THIS INSTRUCTION IS CRITICAL IN THIS CASE.
JUDGE DAVILA: WELL, WHAT -- YOUR POINT IS THAT THE JURY MUST FIND THAT MS. HOLMES, IF THEY FIND THAT SHE ACTED KNOWINGLY, THAT SHE HERSELF HAD KNOWLEDGE OF THE FACT, SHE HERSELF.
MS. SAHARIA: CORRECT.
JUDGE DAVILA: RIGHT. AND NOT ANYONE ELSE. I COULD SEE ADDING THAT ONE SENTENCE.
MS. SAHARIA: THE FIRST SENTENCE, YOUR HONOR?
JUDGE DAVILA: YES.
MS. SAHARIA: THAT WOULD BE BETTER THAN NEITHER OF THEM. WE DO REQUEST BOTH OF THEM. AND I DO WORRY THAT IF THE GOVERNMENT MAKES ARGUMENT IN CLOSING SIMILAR TO WHAT WE JUST HEARD, WE WILL BE COMING BACK TO THE COURT AND ASKING THE COURT TO ADD THAT SECOND SENTENCE TO THE EXTENT THAT THE ARGUMENT STRAYS INTO THIS IMPROPER IMPUTING THEORY. BUT I WOULD BE HAPPY IF THE COURT WOULD, AT A MINIMUM, ADD THE FIRST SENTENCE, ALTHOUGH WE REQUEST THE SECOND SENTENCE AS WELL.
JUDGE DAVILA: I THINK GIVING THE SECOND -- PARDON ME, THE FIRST SENTENCE IS -- WHEN I LOOK AT IT, IT'S SOMEWHAT CUMULATIVE OF THE FIRST SENTENCE, ISN'T IT? IT'S A REPETITIVE STATEMENT OF THE FIRST SENTENCE. MS. VOLKAR?
MS. VOLKAR: YOUR HONOR, THE GOVERNMENT JUST POINTS OUT, AGAIN, THAT THE MODEL INSTRUCTION HAS BEEN AROUND FOR A LONG TIME. THIS CASE HAS BEEN OUT THERE FOR 50 YEARS. THIS HASN'T BEEN ADDED FOR A REASON. IT WASN'T EVEN AN INSTRUCTIONAL ERROR CASE. IT WAS ABOUT AN EVIDENTIARY ISSUE. YOUR HONOR HAS BEEN FOLLOWING THIS CASE IN MAKING EVIDENTIARY RULINGS AND THE GOVERNMENT IS NOT CONTESTING THAT HERE. THERE'S JUST NO NEED TO ADD THIS TO THE TRIED AND TRUE STANDARD OF KNOWINGLY THAT IS USED DAY IN AND DAY OUT IN WIRE FRAUD CASES, IN CRIMINAL CASES. I JUST -- I REALLY DON'T -- I FAIL TO SEE HOW THIS ONE CASE FROM 1965 THAT ISN'T EVEN AN INSTRUCTIONAL ERROR CASE WARRANTS CHANGING THE MODEL INSTRUCTION GIVEN IN EVERY WIRE FRAUD CASE.
JUDGE DAVILA: WELL, TO THE POINT THAT MS. VOLKAR MAKES, SHE'S -- EXCUSE ME, MS. SAHARIA MAKES, SHE'S CONCERNED THAT THERE MIGHT BE SOME PHILLIPS ISSUE. I DON'T SEE IT, FRANKLY. I THINK THE FACTS ARE SIGNIFICANTLY DISTINGUISHABLE IN THAT CASE. BUT I'LL GIVE THAT SENTENCE, THAT ONE SENTENCE. I'M NOT GOING TO GIVE THE SECOND SENTENCE, MS. SAHARIA.
MS. SAHARIA: THANK YOU, YOUR HONOR.
JUDGE DAVILA: BUT I'LL GIVE THE FIRST SENTENCE. INSTRUCTION 26, I THINK YOU WANT TO REMOVE "ALLEGED."
MS. SAHARIA: WE WANT TO ADD "ALLEGED."
JUDGE DAVILA: EXCUSE ME, YOU WANT TO ADD "ALLEGED."
MS. VOLKAR: YOUR HONOR, EXCUSE ME. SORRY TO CIRCLE BACK. WHAT ABOUT THE OMISSIONS POINT?
JUDGE DAVILA: I'M GOING TO LEAVE THAT.
MS. VOLKAR: OKAY. THANK YOU.
JUDGE DAVILA: MS. VOLKAR, ALLEGED?
MS. VOLKAR: YOUR HONOR, THE GOVERNMENT OBJECTS TO REFERRING TO THEM AS ALLEGED VICTIMS. WE UNDERSTAND WHY THEY WANT TO ADD "ALLEGED CRIME" OR "ALLEGED CONSPIRACY," EVEN THOUGH THE MODEL INSTRUCTIONS USED IN EVERY CASE DON'T HAVE THEM IN THERE, AND OF COURSE THAT IS TRUE OF EVERY CRIMINAL CASE. THESE ARE VICTIMS, AND THE DEFENSE HAS REJECTED THAT ALL ALONG, AND THEY ARE ENTITLED TO THEIR VIEW, BUT THEY ARE VICTIMS AND I THINK IT DOES A DISSERVICE TO CALLED THEM ALLEGED VICTIMS. IT'S REALLY NOT FAIR.
MS. SAHARIA: YOUR HONOR, IT'S THE GOVERNMENT'S -- THEIR CLAIM IS THAT THEY'RE VICTIMS AND WE'RE, OF COURSE, ENTITLED TO DISPUTE THAT THEY ARE VICTIMS. THE WORD "VICTIMS" CONNOTES THAT A CRIME HAS OCCURRED. THIS WHOLE CASE IS ABOUT WHETHER A CRIME HAS OCCURRED.
JUDGE DAVILA: UNDERSTOOD. BUT "ALLEGED" IS NOT IN THE MODEL INSTRUCTIONS.
MS. SAHARIA: THIS IS NOT A MODEL INSTRUCTION. THIS IS A GOVERNMENT WRITTEN INSTRUCTION.
JUDGE DAVILA: I UNDERSTAND. BUT "ALLEGED" IS NOT -- YOU DON'T SEE THAT IN THE INSTRUCTIONS WHERE YOU'VE ASKED ME TO ADD IT, AND I THINK I --
MS. SAHARIA: I DON'T THINK THE WORD "VICTIM" IS IN THE INSTRUCTIONS EITHER. TO BE FAIR, THE WORD "VICTIM" IS NOT IN THE MODEL INSTRUCTIONS EITHER. THIS IS NOT A MODEL INSTRUCTION. THIS IS AN INSTRUCTION THAT THE GOVERNMENT WROTE, AND WE HAVE AGREED TO THE CONCEPT OF THIS INSTRUCTION AS PART OF THE MEET AND CONFER PROCESS. WE DID NOT OBJECT TO THIS INSTRUCTION. WE SIMPLY OBJECT TO CALLING INVESTORS VICTIMS WHEN THAT'S PART OF THE GOVERNMENT'S BURDEN OF PROOF.
JUDGE DAVILA: WHAT SHOULD THEY BE CALLED?
MS. SAHARIA: ALLEGED VICTIMS. THE GOVERNMENT ALLEGES THAT THEY'RE VICTIMS. THAT'S WHAT THEY ALLEGE IN THE INDICTMENT.
JUDGE DAVILA: WHAT SHOULD THEY BE CALLED IF THEY'RE NOT CALLED VICTIMS?
MS. SAHARIA: YOU COULD SAY "INVESTORS' CONDUCT," IT COULD BE "WIRE FRAUD," THE TITLE COULD BE "WIRE FRAUD INVESTORS' CONDUCT," AND THEN THE FIRST SENTENCE COULD READ, "AN INVESTOR'S NEGLIGENCE IS NOT A DEFENSE TO WIRE FRAUD." THE NEXT SENTENCE REFERS TO THEM AS INVESTORS. THIS SENTENCE IS ABOUT THE INVESTORS. SO I THINK, GIVEN THAT THE SECOND SENTENCE EXPRESSLY USES THE WORD "INVESTORS," THE COURT COULD SUBSTITUTE "INVESTORS" FOR "VICTIMS" AND THAT WOULD ALSO RESOLVE OUR CONCERN.
(PAUSE IN PROCEEDINGS.)
MS. VOLKAR: YOUR HONOR, MAY I BE HEARD ON THAT POINT?
JUDGE DAVILA: YES.
MS. VOLKAR: I FEEL LIKE WE'RE BACK SLIDING. THIS IS AN INSTRUCTION THAT, THROUGH THE MEET AND CONFER PROCESS, THE PARTIES ACTUALLY SUBSTANTIALLY AGREED ABOUT. THAT, OF COURSE, DIDN'T HAVE TO BE THE CASE. BUT WHEN WE CAME BEFORE YOUR HONOR THIS PAST FRIDAY, THE WORD "ALLEGED" WASN'T IN THERE AND THE PARTIES AGREED TO EVERYTHING BUT THE WORD "OMISSIONS" IN THIS INSTRUCTION, AND NOW WE'RE MOVING FROM NOT JUST ADDING THE WORD "ALLEGED" ON FRIDAY AFTER WE HAD THE HEARING BEFORE YOUR HONOR, BUT CHANGING IT TO A DIFFERENT WORD ENTIRELY. IF THE DEFENSE DISAGREED WITH THIS INSTRUCTION, WE COULD HAVE CONTINUED TO DISCUSS THAT DURING THE MEET AND CONFER PROCESS. SO I STRONGLY OBJECT TO THE BACK SLIDING OF PROGRESS THAT WE'RE DOING HERE, AND I CERTAINLY OBJECT TO THE CONCEPT THAT PEOPLE WHO LOST MONEY IN THIS SCHEME, WHETHER OR NOT MS. HOLMES WAS PART OF IT, THERE ARE CERTAINLY OTHER WAYS THAT THE DEFENDANTS CAN POINT TO YOU. THESE PEOPLE DID LOSE MONEY BECAUSE THEY WERE LIED TO. THEY ARE VICTIMS. I THINK TRYING TO REFER TO THEM AS INVESTORS IS JUST ALONG THE LINES OF BLAMING THE VICTIM THAT YOUR HONOR HAS POINTED OUT THE DEFENSE SHOULD NOT BE ALLOWED TO DO, BOTH IN THE MOTIONS IN LIMINE STAGE AND THROUGHOUT THE TRIAL. THIS INSTRUCTION IS A DIRECT RESPONSE TO THAT AND AN ATTEMPT TO PUT GUARDRAILS IN, AND NOW THEY'RE TRYING TO GO BACK TO, WELL, THEY'RE JUST INVESTORS AND MAYBE THEY DESERVED TO LOSE MONEY. THAT'S NOT PROPER, YOUR HONOR.
MS. SAHARIA: YOUR HONOR, WE'RE NOT ARGUING THAT MAYBE THEY DESERVED TO LOSE MONEY. THAT'S NOT A FAIR ARGUMENT FROM MS. VOLKAR. BOTH PARTIES, AS WE'VE BEEN CRAFTING THESE INSTRUCTIONS, HAVE REALIZED THINGS THAT WE OBJECT TO. WE REALIZED ON FRIDAY THAT WE OBJECT TO THE WORD "VICTIM." THEY REALIZED THEY WANTED TO ADD THE NAMES OF THE INVESTORS. WE'RE ALL ACTING IN GOOD FAITH HERE. BUT THE FACT OF WHETHER THEY'RE VICTIMS PRESUPPOSES THAT A CRIME HAS OCCURRED, AND THAT'S WHAT THE JURY IS SUPPOSED TO DECIDE, SO LET'S NOT CALL THEM AFFIRMATIVELY VICTIMS.
JUDGE DAVILA: IS THERE ANY QUESTION THAT THEY LOST MONEY, THEY LOST THEIR INVESTMENT?
MS. SAHARIA: NO, YOUR HONOR. BUT THAT DOESN'T MEAN THEY'RE A VICTIM.
JUDGE DAVILA: SHOULD WE CALL THEM THEN "INVESTORS WHO LOST THEIR INVESTMENT," OR WORDSMITH THAT SOMEHOW SO THAT REFLECTS WHAT REALLY HAPPENED?
MS. SAHARIA: THE INDICTMENT --
JUDGE DAVILA: YOU SUGGEST THAT THEY'RE NOT VICTIMS YET BECAUSE THAT HAS NOT YET BEEN PROVED. BUT WHAT WE KNOW IS THAT THEY HAVE LOST MONEY.
MS. SAHARIA: THE INDICTMENT CALLS THEM "INVESTORS," SO LET'S USE THE WORD OF THE INDICTMENT AND CALL THEM "INVESTORS," YOUR HONOR.
JUDGE DAVILA: AND SHOULD WE IDENTIFY THEM IN SOME MANNER AS THE INVESTORS WHO LOST MONEY SOMEHOW? DO YOU WANT TO WORDSMITH THAT? I'LL GIVE YOU A CHANCE TO DO THAT WHILE WE MOVE ON TO THE OTHERS.
MS. SAHARIA: I WILL CONSIDER THAT WHILE WE TALK ABOUT THE CMS REPORT, YOUR HONOR.
JUDGE DAVILA: RIGHT.
MS. SAHARIA: IF WE COULD SKIP THE CMS REPORT AND JUST BRIEFLY TOUCH ON THE VERDICT FORM? I THINK THAT'S THE ONLY REMAINING ISSUE.
JUDGE DAVILA: OKAY.
MS. SAHARIA: THE PARTIES ARE IN AGREEMENT AS TO THE SUBSTANCE OF THE VERDICT FORM, WITH ONE EXCEPTION, WHICH IS IT'S OUR POSITION THAT THE WORD "NOT GUILTY" SHOULD GO BEFORE THE WORD "GUILTY." GIVEN THE PRESUMPTION OF INNOCENCE, IT'S APPROPRIATE FOR THE WORD "NOT GUILTY" TO GO FIRST SINCE MS. HOLMES IS PRESUMED TO BE INNOCENT.
JUDGE DAVILA: UNDERSTOOD.
MS. VOLKAR: YOUR HONOR, WE JUST MIMICKED, AS FAR AS WE KNOW, EVERY VERDICT FORM THAT WE'RE USED TO SEEING. IT JUST TENDS TO READ, IN ORDER, GUILTY/NOT GUILTY, AND I THINK THAT, AS WITH A LOT OF THE INSTRUCTIONS, THAT THE DEFENSE IS OVERLY WORDSMITHING AND TRYING TO SPLIT HAIRS WHERE IT'S REALLY JUST UNNECESSARY.
JUDGE DAVILA: THANK YOU. I'LL LEAVE THE VERDICT FORM AS GUILTY/NOT GUILTY. THAT'S WHAT I'VE DONE IN MY PRACTICE.
MS. SAHARIA: UNDERSTOOD.
JUDGE DAVILA: I DON'T THINK THERE'S ANYTHING UNTOWARD ABOUT IT. I DON'T THINK IT PREJUDICES A DEFENDANT AT ALL. THE JURY IS GOING TO BE ADVISED OF THE PRESUMPTION OF INNOCENCE. THEY WERE THOROUGHLY VETTED ON THAT CONCEPT DURING VOIR DIRE BOTH FROM COUNSEL AND FROM THE COURT, AND I'VE DONE THAT -- I THINK I'VE MADE SOME COMMENTS ABOUT THAT THROUGHOUT THE TRIAL IN REGARDS TO CERTAIN TOPICS THAT HAVE COME UP.
MS. SAHARIA: BEFORE I CEDE THE PODIUM TO MR. LEMENS ON THE CMS ISSUE, I JUST KIND OF WANTED TO MAKE ONE POINT CLEAR WITH RESPECT TO OUR OBJECTIONS, AND THEN TALK ABOUT THE PROCESS OF READING THE INSTRUCTIONS TO THE JURY. IN THE PRIOR CHARGE CONFERENCES, OF COURSE WE DIDN'T HAVE DRAFT INSTRUCTIONS YET FROM THE COURT, SO WE WERE OBJECTING TO EITHER THE GOVERNMENT'S PROPOSAL OR THE MODEL INSTRUCTIONS. I JUST WANT TO MAKE CLEAR AND REITERATE TO THE EXTENT THAT THE COURT HAS NOW ADOPTED THOSE MODELS OR ADOPTED THE GOVERNMENT'S PROPOSALS, OF COURSE WE HAVE THE SAME OBJECTIONS, AND I JUST WANTED TO REITERATE THOSE FOR THE RECORD.
JUDGE DAVILA: OKAY.
MS. SAHARIA: AND THEN WITH RESPECT TO THE READING OF THE INSTRUCTIONS TO THE JURY, AS THE COURT NO DOUBT KNOWS, RULE 30(D) REQUIRES THAT THERE BE, OR AT LEAST SUGGESTS, THAT THERE BE ANOTHER OBJECTION RIGHT AFTER THE INSTRUCTIONS ARE READ TO THE JURY BEFORE THEY RETIRE. THE NINTH CIRCUIT HAS ALLOWED THAT TO OCCUR BY AN INCORPORATING OF THE PREVIOUSLY STATED OBJECTIONS. WE ARE ENTITLED TO DO THAT OUTSIDE OF THE HEARING OF THE JURY, BUT OF COURSE WE'RE NOT HAVING BENCH CONFERENCES WITH THE COURT DUE TO THE COVID PROTOCOLS. SO I WASN'T SURE IF THE COURT HAD AN IDEA AS TO HOW WE MIGHT DO THAT OUTSIDE OF THE HEARING OF THE JURY. I THOUGHT PERHAPS THE COURT COULD STATE ON THE RECORD, IF THE GOVERNMENT WILL CONCEDE TO THIS, "I NOW INCORPORATE BOTH PARTIES' PRIOR OBJECTIONS," AND JUST ASK IF THERE ARE ANY ADDITIONAL OBJECTIONS AT THAT TIME. I JUST WOULD THROW THAT OUT AS A PROPOSAL FOR HOW TO HANDLE THAT.
JUDGE DAVILA: WELL, THANK YOU. THE COURT DOES, AT THE CONCLUSION OF THE READING OF THE INSTRUCTIONS, THE COURT DOES TURN TO EACH TABLE AND ASK, "ARE THERE ANY OBJECTIONS TO THE COURT'S READING OF THE INSTRUCTIONS?" AND I THINK THE SPIRIT OF THAT IS, DID THE COURT MAKE A MISTAKE --
MS. SAHARIA: UNDERSTOOD, YOUR HONOR.
JUDGE DAVILA: -- WHEN IT READ WHAT WE HAD PREVIOUSLY AGREED TO. THAT'S WHY WE'RE MEETING THIS MORNING.
MS. SAHARIA: YES.
JUDGE DAVILA: AND THAT'S THE REAL SPIRIT, I BELIEVE, OF THAT QUESTION, IS IF THE COURT MADE A MISTAKE IN READING, THAT'S THE TIME TO CORRECT IT. ARE YOU SUGGESTING, MS. SAHARIA, THAT IF YOU ANSWER "NO OBJECTION" TO THAT, THAT MEANS THAT YOU'RE SAYING --
MS. SAHARIA: I HAVE SOMETIMES SEEN THE GOVERNMENT MAKE THAT ARGUMENT -- I'M NOT SUGGESTING THAT THESE PROSECUTORS WOULD -- BUT THERE'S SOME CASE LAW THAT SUGGESTS THAT IT'S APPROPRIATE AT THAT TIME JUST TO SAY "WE INCORPORATE BY REFERENCE OUR PRIOR OBJECTIONS," AND LEAVE IT AT THAT. SO I JUST WANTED TO THROW OUT THAT WE WOULD FEEL MORE COMFORTABLE IF WE HAD THE OPPORTUNITY TO SAY "WE INCORPORATE OUR PRIOR OBJECTIONS."
JUDGE DAVILA: IN FRONT OF THE JURY?
MS. SAHARIA: NO, WE PREFER NOT TO DO THAT IN FRONT OF THE JURY.
JUDGE DAVILA: SO WHEN I ASK THE QUESTION, "DO YOU HAVE ANY OBJECTIONS TO THE COURT'S READING OF THE INSTRUCTIONS," AND IF YOU DO --
MS. SAHARIA: IF WE DO, WE WOULD SAY, "YES, YOUR HONOR," AND WE WOULD HAVE TO EXCUSE THE JURY. BUT I ASSUME THE COURT WILL READ THEM PROPERLY, SO I DON'T ANTICIPATE THAT HAPPENING. PERHAPS WE CAN JUST SAY "NOTHING FURTHER, YOUR HONOR," AND THEN YOUR HONOR CAN JUST SAY SOMETHING LIKE, "I UNDERSTAND THE PARTIES TO INCORPORATE THEIR PRIOR OBJECTIONS," SOMETHING LIKE THAT.
JUDGE DAVILA: CAN'T WE DO THAT IN ADVANCE OF THAT?
MS. SAHARIA: WE COULD DO THAT RIGHT IN ADVANCE OF THE READING, WHENEVER THERE'S AN APPROPRIATE BREAK, MAYBE WE COULD DO SOMETHING LIKE THAT.
JUDGE DAVILA: OKAY. MS. VOLKAR?
MS. VOLKAR: YOUR HONOR, I DON'T SEE ANY REASON WHY THE PARTIES CAN'T DO WHAT THEY'VE DONE SORT OF AT OTHER POINTS DURING THE TRIAL IN FRONT OF THE JURY WHEN THERE HAS BEEN LENGTHY DISCUSSION THE MORNING OF, SUCH AS "WE INCORPORATE OUR PRIOR DISCUSSION," OR "NOTHING FURTHER BEYOND OUR PRIOR DISCUSSION" OR "NOTHING FURTHER BEYOND OUR PRIOR OBJECTIONS." I THINK THE PARTIES HAVE BEEN DOING THAT THROUGHOUT THIS TRIAL. PERHAPS I'M NOT FULLY SEEING THE ISSUE HERE, BUT I GUESS THAT'S THE GOVERNMENT'S POSITION IS SOMETHING LIKE THAT COULD BE SAID.
MS. SAHARIA: I THINK WE COULD SAY "NOTHING FURTHER IN ADDITION, YOUR HONOR." BUT IF THE COURT COULD THEN SAY, "UNDERSTOOD, THE PRIOR OBJECTIONS ARE INCORPORATED," SOMETHING LIKE THAT WOULD BE HELPFUL TO US, YOUR HONOR.
JUDGE DAVILA: WELL, THERE'S NOTHING MAGICAL ABOUT READING THE INSTRUCTIONS THAT SOMEHOW EVISCERATES YOUR PRIOR OBJECTIONS. THEY'RE IN THE RECORD.
MS. SAHARIA: YES, YOUR HONOR.
JUDGE DAVILA: AND THEY'RE PRESERVED.
MS. SAHARIA: THANK YOU.
JUDGE DAVILA: BUT IF YOU WOULD LIKE ME, OUT OF AN ABUNDANCE OF CAUTION, TO ALLOW YOU TO STATE THAT, I'LL LET YOU STATE THAT ON THE RECORD IF YOU WOULD LIKE.
MS. SAHARIA: OKAY. THANK YOU.
MS. VOLKAR: THAT'S FINE WITH THE GOVERNMENT. THANK YOU.
MS. SAHARIA: I'M GOING TO TURN THE PODIUM OVER TO MR. LEMENS.
JUDGE DAVILA: OKAY.
(PAUSE IN PROCEEDINGS.)
JUDGE DAVILA: MS. SAHARIA, MS. KRATZMANN JUST PROVIDED ME A COPY OF THE VERDICT FORM, AND IS THERE A NUMERICAL -- LET'S SEE, IT'S ON PAGE 2.
MS. SAHARIA: WELL, BECAUSE A COUNT WAS ELIMINATED, WE SKIPPED THAT NUMBER SO THAT THE NUMBERS IN THE PARAGRAPHS CORRESPOND TO THE NUMBERS OF THE COUNT. THE COURT COULD CHOOSE TO DO IT DIFFERENTLY. THAT WAS THE REASON FOR THAT MISSING NUMBER.
JUDGE DAVILA: OKAY.
MS. SAHARIA: THAT'S THE COUNT THAT WAS DISMISSED BY THE GOVERNMENT.
JUDGE DAVILA: MS. VOLKAR?
MS. VOLKAR: THE GOVERNMENT AGREED TO THAT FORMULATION. IT JUST MAKES IT A LITTLE BIT EASIER, EIGHT IS EIGHT AND TEN IS TEN. BUT WE DON'T OBJECT IF THE COURT WANTS TO NUMERICALLY ORDER THE PARAGRAPHS.
(DISCUSSION OFF THE RECORD.)
JUDGE DAVILA: WELL, I THINK WE HAVE AN INTELLIGENT AND SMART JURY, BUT THE CONCERN IS WHETHER OR NOT THEY'LL NOT UNDERSTAND THAT NINE IS GONE. DO WE NEED TO ADD SOMETHING HERE, OR WOULD THAT BE TOO MUCH INFORMATION FOR THEM?
MS. SAHARIA: I THINK THE GOVERNMENT, AS I RECALL, DISMISSED THAT COUNT IN FRONT OF THE JURY, SO I DON'T THINK THERE'S ANY NEED TO ADD THAT TO THE VERDICT FORM. I DON'T FEEL STRONGLY ABOUT THE NUMBERING OF THE PARAGRAPHS. IF YOUR HONOR WANTS THEM TO GO IN NUMERICAL ORDER AND SKIP NINE, THAT'S FINE WITH ME.
JUDGE DAVILA: WELL, WE'RE DOING SO MUCH TO HELP THIS JURY UNDERSTAND THINGS.
MS. VOLKAR: I AGREE, YOUR HONOR. I WOULD RATHER JUST NUMERICALLY ORDER THE PARAGRAPHS THAN TRY TO CONTINUE TO ADD ANYTHING TO THE VERDICT FORM. I THINK THE PARTIES HAVE DONE A LOT IN MEET AND CONFER THUS FAR AND THERE'S NO REASON TO INTERJECT SOMETHING FURTHER IN THAT.
JUDGE DAVILA: SO YOU'D LIKE TO RENUMBER THEM SO THERE'S NO SKIP, NO BREAK?
MS. VOLKAR: I PREFER THAT. I DO THINK I'M FINE THE WAY IT IS, BUT I'M IN THE SAME POSITION AS MS. SAHARIA, I DON'T HAVE A STRONG POSITION ABOUT RENUMBERING IF THE COURT THINKS THAT WOULD BE EASIER FOR THE JURY.
MS. SAHARIA: IT'S UP TO THE COURT'S PREFERENCE.
JUDGE DAVILA: WELL, WHAT DO YOU THINK IS GOING TO BE EASIER FOR THE JURY TO CAPTURE? ARE WE GOING TO HAVE JURY CONFUSION IF THERE IS NO NINE, OR WILL THEY UNDERSTAND THAT NINE WAS DISMISSED?
MS. SAHARIA: THEY WERE TOLD ABOUT THE DISMISSAL IN THEIR PRESENCE, SO I'M NOT SURE THAT THEY WILL BE CONFUSED.
JUDGE DAVILA: I SUPPOSE WE STILL HAVE TO TALK ABOUT IF THEY'RE GOING TO GET SOMETHING, EITHER THE INDICTMENT OR SOMETHING THAT IS LIKE THE INDICTMENT THAT HAS THE FULSOME. I KNOW YOU WERE CONCERNED ABOUT THAT, MS. SAHARIA, AND I DON'T KNOW IF THE GOVERNMENT STILL INTENDS TO DO SOMETHING TO PROVIDE THEM WITH A LIST OF THE CHARGES.
MS. SAHARIA: I THINK I HEARD MS. VOLKAR SAY THAT THEY THINK THAT THE INSTRUCTIONS ARE SUFFICIENT FOR THAT PURPOSE, AND THAT'S OUR POSITION AS WELL. I'M -- I WILL GO BACK AND LOOK AT JUST THE COUNTS, THE COUNT PARAGRAPHS, AND I CAN CONFER WITH MY TEAM ABOUT THAT.
JUDGE DAVILA: OKAY.
MS. SAHARIA: BUT OUR POSITION IS THAT WE THINK THE INSTRUCTIONS ARE SUFFICIENT.
JUDGE DAVILA: ALL RIGHT. THANK YOU. I'LL LEAVE IT AS IS. IT'S MY EXPERIENCE THAT COUNSEL ALWAYS REFERENCE THE VERDICT FORM MORE -- USUALLY REFERENCE THE VERDICT FORM WHEN THEY ASK THE JURY TO DO WHAT THEY WOULD LIKE THEM TO DO, AND THEY REFERENCE THE VERDICT FORM AND IT'S AVAILABLE FOR YOU TO DO THAT IF YOU WISH, IF YOU THINK CLARIFICATION IS NEEDED.
MS. SAHARIA: THANK YOU.
JUDGE DAVILA: SO I'LL LEAVE IT AS IT IS WITHOUT RENUMBERING IT. OKAY?
MS. SAHARIA: THANK YOU.
MS. VOLKAR: THANK YOU, YOUR HONOR. ONE LAST POINT BEFORE MS. SAHARIA LEAVES THE PODIUM. GOING BACK TO THE ALLEGED VICTIM OR THE VICTIM'S CONDUCT, I WOULD LIKE TO SAY THAT THE GOVERNMENT'S POSITION IS THAT IF WORDSMITHING IS GOING TO OCCUR, THEN "ALLEGED VICTIM" IS BETTER THAN -- I KNOW THERE WERE MULTIPLE OTHER FORMULATIONS THAT THE COURT WAS GOING TO CONSIDER, AND I KNOW MS. SAHARIA WAS GOING TO THINK ABOUT THEM. SO I WANTED TO, FOR HER BENEFIT, SAY THAT THE GOVERNMENT'S PREFERENCE WOULD BE TO ADD JUST "ALLEGED VICTIM" RATHER THAN TO GO BACK AND TRY AND RESTART NEGOTIATING ABOUT WHAT THE PROPER DESCRIPTION OF THIS CLASS OF INDIVIDUALS IS.
JUDGE DAVILA: ALL RIGHT. THANK YOU.
MS. SAHARIA: THAT'S FINE WITH ME, YOUR HONOR.
JUDGE DAVILA: YOU'RE STILL GOING TO WORDSMITH THOUGH.
MS. SAHARIA: I WILL, BUT IT SOUNDS LIKE MS. VOLKAR WOULD TAKE "ALLEGED VICTIM" OVER ANY WORDSMITHING, BUT I'M HAPPY TO GO BACK AND LOOK AT IT.
JUDGE DAVILA: WELL, LET'S SEE HOW CREATIVE YOU CAN BE WHILE I'M TALKING TO MR. LEMENS. I'M SURE YOU'LL COME UP WITH SOMETHING.
MS. SAHARIA: OKAY. I'LL TRY TO BE CREATIVE, YOUR HONOR.
JUDGE DAVILA: ALL RIGHT. CMS REPORT. AND THIS IS REGARDING JURY INSTRUCTION 29, I BELIEVE.
MR. LEMENS: I BELIEVE THAT'S HOW WE GOT HERE, YOUR HONOR, YES.
JUDGE DAVILA: AND I HAVE 29, WHICH WAS -- I THINK WE TALKED ABOUT THIS LAST WEEK ON FRIDAY, AND THE WHOLE TOPIC IS WHETHER OR NOT 4621A AND B SHOULD COME IN FOR THE LIMITED PURPOSE OF STATE OF MIND. I THINK ONE OF THEM WAS ADMITTED FOR THAT PURPOSE, AND THE OTHER ONE WASN'T. I TOLD YOU I WAS GOING TO READ THE TRANSCRIPTS OVER THE WEEKEND. I DID. YOU IDENTIFIED PORTIONS THAT YOU WOULD LIKE ME TO READ. THAT WAS HELPFUL. I THINK, MR. CLEARLY, YOU PROVIDED THE COURT WITH SOME TRANSCRIPTS FRIDAY THAT I LOOKED AT ALSO AND READ OTHER PORTIONS OF THE TRANSCRIPT. SO WHAT ELSE WOULD YOU LIKE ME TO KNOW ON THIS?
MR. LEMENS: SO I THINK, JUST FOR THE RECORD, ANDREW LEMENS FOR THE RECORD.
JUDGE DAVILA: I SAID MR. CLEARY, DIDN'T I? I APOLOGIZE.
MR. LEMENS: WE LOOK VERY SIMILAR.
JUDGE DAVILA: WHICH ONE OF YOU IS YOUNGER? OH, YOU CAN ANSWER THAT LATER.
MR. LEMENS: HE IS, I THINK.
(LAUGHTER.)
JUDGE DAVILA: YOU ALL LOOK TERRIBLY YOUNG TO ME.
MR. LEMENS: IF IT GIVES YOUR HONOR COMFORT, THIS IS A COMMON PROBLEM WE'VE BEEN HAVING THROUGHOUT OUR TIME IN SAN JOSE. I WILL JUST SAY ON THE MOTION, MS. HOLMES'S POSITION IS, OF COURSE, THAT THE DOCUMENTS, BOTH A AND B, CAME IN FOR A LIMITED PURPOSE. I THINK THE GOVERNMENT'S POSITION IS NOW 4621A CAME IN FOR ITS TRUTH. WE DISAGREE FOR THE REASONS WE SET FORTH IN OUR PLEADING BOTH AS TO WHAT OCCURRED PRIOR TO DR. DAS'S TESTIMONY, DURING DR. DAS'S TESTIMONY, AND THEN THE REPRESENTATIONS THAT WERE MADE AFTER DR. DAS'S TESTIMONY AT THE CLOSE OF THE GOVERNMENT'S CASE. EVEN IF THEY CAME IN FOR THAT LIMITED PURPOSE, WE HAVE CONCERNS UNDER RULE 403.
THOSE CONCERNS ARE THAT THE REPORT ITSELF, THE CONTENT OF THE REPORT, AND THE CONTENT OF THE COVER LETTER HAS VERY LITTLE PROBATIVE VALUE, IF ANYTHING, TO THE ISSUES IN THE CASE, AND CONSIDERABLE PREJUDICE IN LIGHT OF THE GOVERNMENT'S FAILURE TO CALL A CMS WITNESS WHO COULD PROVIDE CONTEXT AROUND THE REPORT, HOW IT WAS DRAFTED, WHAT DECISIONS WERE MADE AND, IN THE COURSE OF THAT DRAFTING, WHAT WAS INCLUDED, WHAT WASN'T INCLUDED AND WHY, WHAT OTHER INFLUENCES OR FACTORS WERE CONSIDERED BY CMS IN PUTTING THIS DOCUMENT TOGETHER, AND, OF COURSE, JUST THE NATURE OF THE DOCUMENT ITSELF AND THE IMPRIMATUR THAT IT CREATES EVEN IF COMING IN FOR NOTICE. I THINK THE GOVERNMENT HAS PUT FORWARD SEVERAL ARGUMENTS AS TO ITS RELEVANCE. THOSE ARE GENERAL STATEMENTS ABOUT, AS I UNDERSTAND THEM, YOU KNOW, WE'VE TALKED -- YOU KNOW, THERE WAS EVIDENCE ABOUT WHAT HAPPENED IN 2016 IN THIS CASE, AND THEREFORE, THIS COMES IN.
OUR POSITION IS THAT THEY NEED TO CONNECT IT MORE CLOSELY OR MORE DIRECTLY TO A SPECIFIC ISSUE. WE DO NOT DISPUTE THAT THE FACT OF THE CMS REPORT WAS ISSUED, THE FACT THAT AN INSPECTION HAD OCCURRED, I THINK THERE'S EVEN BEEN SOME TESTIMONY THAT THE CMS REPORT WAS GENERALLY NEGATIVE. BUT THAT DOES NOT JUSTIFY THE ADMISSION OF THIS DOCUMENT SIMPLY FOR NOTICE. IF IT CAME IN FOR NOTICE, IF IT CAME IN FOR STATE OF MIND, IT NEEDS TO CONNECT TO SOMETHING. WHAT DOES THAT STATE OF MIND INFORM? I THINK THE BEST ANALOGY THAT I FOUND OVER THE WEEKEND AFTER THINKING QUITE A BIT ABOUT THIS IS "THE WALL STREET JOURNAL" ARTICLE THAT YOUR HONOR EXCLUDED FROM EVIDENCE, OR THE SERIES OF ARTICLES. THERE WAS PLENTY OF TESTIMONY IN THE CASE ABOUT THOSE ARTICLES, THE FACT OF THOSE ARTICLES, WHAT HAPPENED AS A RESULT OF THOSE ARTICLES, OR WHAT COULD HAVE HAPPENED, KIND OF HOW THOSE ARTICLES WERE RESPONDED TO. BUT THE ARTICLES DIDN'T NEED TO COME IN. THAT'S THE SAME SITUATION HERE. WE HAVE A REPORT, WE HAVE A COVER LETTER THAT HAS INCREDIBLY PREJUDICIAL LANGUAGE, HAS IMPLICATIONS OR SUGGESTIONS BASED ON THAT LANGUAGE, AND WAS NOT SUBJECT TO CROSS-EXAMINATION SUCH THAT THE JURY UNDERSTANDS WHAT IT MEANS BECAUSE THE GOVERNMENT DECIDED NOT TO CALL THE WITNESS WHO COULD PROVIDE THAT CONTEXT. SO THAT'S ALL TO SAY IT DIDN'T COME IN FOR ITS TRUTH, NEITHER A NOR B IN OUR POSITION, AND EVEN IF IT CAME IN FOR THAT LIMITED PURPOSE, IT SHOULD BE STRUCK UNDER 403.
JUDGE DAVILA: DOES IT -- THANK YOU. DOES IT, DOES IT GO -- 4621, LET'S TALK ABOUT A AND B. IF THE COURT FINDS THAT, IN LOOKING AT -- AND MS. VOLKAR, I KNOW YOU'RE LISTENING CAREFULLY HERE -- BUT IN LOOKING AT THE TOTALITY OF THE CONVERSATIONS IN THE TRANSCRIPTS, INCLUDING CONVERSATION AT THE MIL AND OTHERS, IF THE COURT WERE TO FIND THAT THE TOTALITY OF ALL OF THOSE CONVERSATIONS PRIOR TO THE INTRODUCTION OF THE DOCUMENTS AND IN THE WAY THAT THEY WERE INTRODUCED SUGGESTS THAT PARTIES WERE UNDER THE BELIEF THAT THEY WERE COMING IN NOT FOR THEIR TRUTH, BUT JUST FOR THE ISSUE OF NOTICE AND STATE OF MIND OF MS. HOLMES, THEN THE COURT -- AND IF THE COURT DECIDED TO ADMIT A AND B FOR THAT LIMITED PURPOSE AND GIVE YOUR 29, FORMERLY 31, IT SEEMS THAT THAT MIGHT ASSUAGE YOUR CONCERNS.
MR. LEMENS: WE CERTAINLY OBJECT TO THE DOCUMENTS COMING IN FOR THEIR TRUTH. EVERYTHING I HAVE JUST EXPLAINED WOULD ALSO -- WE HAVE THE SAME CONCERNS IF THEY CAME IN FOR A LIMITED PURPOSE BECAUSE THERE WAS NO WITNESS TO CONTEXTUALIZE THE DOCUMENT. THERE WAS NO -- YOU KNOW, THEY STILL ARE INFLAMMATORY IF NOT EXPLAINED. OF COURSE, YOU KNOW, THOSE CONCERNS WOULD BE GREATER SUBSTANTIALLY IF THE DOCUMENTS CAME IN FOR THEIR TRUTH, BUT THAT DOESN'T ASSUAGE ALL OF OUR CONCERNS. AND, IN FACT, I THINK AS YOUR HONOR WILL RECALL, OUR MOTION TO STRIKE WAS PREMISED ON THE IDEA THAT THEY CAME IN FOR NOTICE, AND I BELIEVE MULTIPLE TIMES THAT WE HAVE TOLD THE COURT THAT OUR CONCERNS WOULD HAVE BEEN RESOLVED IF THE GOVERNMENT CALLED MS. BENNETT OR MR. YAMAMOTO TO TESTIFY ABOUT THE DOCUMENT. THAT DID NOT OCCUR. AND BECAUSE THAT DID NOT OCCUR, WE THINK THE DOCUMENT SHOULD BE STRUCK EVEN FOR THE LIMITED PURPOSE OF NOTICE.
JUDGE DAVILA: WELL, THANK YOU. DON'T THEY SHOW, THE DOCUMENTS, THE DOCUMENTS TEND TO SHOW -- AND THIS IS IN LIGHT OF THE EVIDENCE, BOTH EVIDENCE THAT WAS DERIVED IN THE GOVERNMENT'S CASE, BUT ALSO IN CROSS-EXAMINATION, AND I THINK WE ALL KNOW THAT THE DEFENSE CASE IS TYPICALLY BEGINNING CROSS-EXAMINATION. I THINK ONE OF YOUR COLLEAGUES MAY HAVE SAID THAT. AND SO THERE WAS EVIDENCE THAT WAS DEVELOPED THROUGH CROSS-EXAMINATION THAT DID SOMEWHAT TETHER, CONNECT MS. HOLMES'S STATE OF MIND, OR AT LEAST HER KNOWLEDGE, OF WHAT WAS GOING ON IN THE LAB SUCH THAT UNDER 403, THESE DOCUMENTS, A AND B, COULD PROVIDE SOME INFORMATION ABOUT WHETHER OR NOT SHE WAS AWARE OF THE DEFICIENCIES IN THE LABS AND WHETHER OR NOT SHE TOOK ANY ACTION ABOUT IT.
MR. LEMENS: WELL, CERTAINLY IF THEY COME IN FOR NOTICE -- THE DOCUMENTS WERE ISSUED AND ARE DATED IN JANUARY OF 2016 -- IT WOULD ONLY BE NOTICE AFTER THAT DATE. FOR THE GOVERNMENT TO USE -- AND I'VE SEEN THIS ARGUMENT, OF COURSE, IN THE GOVERNMENT'S PLEADING. FOR THE GOVERNMENT TO USE THAT DOCUMENT RETROACTIVELY WOULD BE A PURPOSE FOR -- REQUIRING ITS TRUTH, AND FOR THE GOVERNMENT TO TRY TO CONNECT THE CLAIMS OR THE STATEMENTS IN THAT DOCUMENT TO TESTIMONY OR WHAT OCCURRED PREVIOUSLY WOULD REQUIRE IT TO COME IN FOR ITS TRUTH, WHICH IS NOT WHAT HAPPENED AND WE THINK IS, IS -- WOULD BE INCREDIBLY PROBLEMATIC.
JUDGE DAVILA: SO THE INVESTIGATION OCCURRED IN 2015, I THINK. IS THAT -- THAT'S WHEN CMS CAME, AND EARLIER, AND THEY DRAFTED A REPORT IN NOVEMBER, I THINK IT WAS.
MR. LEMENS: I BELIEVE WHAT THE RECORD REFLECTS IS THAT THERE WAS AN INSPECTION IN SEPTEMBER, AND THERE WAS A SUBSEQUENT FOLLOW-ON INSPECTION IN NOVEMBER, AND THERE'S OF COURSE BEEN TESTIMONY ABOUT THAT, AND THAT THE REPORT ITSELF WAS ISSUED IN JANUARY, AND IT WAS PROVIDED TO THE COMPANY IN JANUARY.
JUDGE DAVILA: RIGHT.
MR. LEMENS: SO TO THE EXTENT THE REPORT COMES IN FOR NOTICE, IT IS NOTICE AS OF THE DATE IT IS ISSUED.
JUDGE DAVILA: AND WE HAVE EVIDENCE THAT YOUR CLIENT, MS. HOLMES, TOOK SOME ACTION SUBSEQUENT TO HER NOTICE. ISN'T THAT WHEN SHE FORMED THE BOARD, THE ADVISORY BOARD AND DID SOME -- MADE SOME EMPLOYMENT DECISIONS AND OTHER THINGS?
MR. LEMENS: CERTAINLY, YOUR HONOR. I THINK OUR POSITION IS THAT YOU DON'T NEED THE DOCUMENT TO COME IN FOR THE GOVERNMENT TO MAKE ITS ARGUMENT ABOUT THE REPORT, THE FACT THAT THE REPORT WAS NEGATIVE. THE FACT THAT THERE WAS CONSIDERABLE TESTIMONY ABOUT THE INSPECTION APART FROM THE DOCUMENT I THINK IS, IS IMPORTANT, THE FACT THAT THE GOVERNMENT WAS ABLE TO ASK WITNESSES ABOUT THE INSPECTION OR THE REPORT OR THE IMPLICATIONS THEREOF WITHOUT THE DOCUMENT. FOR EXAMPLE, THEY DID NOT SHOW MS. HOLMES THE DOCUMENT. THEY DID NOT ASK HER QUESTIONS ABOUT THE DOCUMENT. THEY WERE ABLE TO JUST --
JUDGE DAVILA: SO I THOUGHT ALSO ABOUT -- WE'VE HAD TESTIMONY FROM MS. CHEUNG AND MR. SHULTZ ABOUT THE LAB AND MS. HOLMES HAVING NOTICE, POTENTIAL NOTICE ABOUT THAT FROM THOSE PARTIES IN SOME MANNER.
MR. LEMENS: UH-HUH.
JUDGE DAVILA: DOES THIS TIE BACK TO THAT? WOULDN'T THAT BE RELEVANT FOR THAT CONSIDERATION AS TO NOTICE?
MR. LEMENS: AGAIN, IF THE REPORT IS ISSUED IN JANUARY -- AND I BELIEVE THE TESTIMONY FROM MS. CHEUNG IS THAT HER CONCERNS, AND MR. SHULTZ, WAS THAT THEIR CONCERNS WERE RAISED IN 2014. MS. CHEUNG TESTIFIED THAT SHE DID NOT INFORM MS. HOLMES OF THOSE CONCERNS IN 2014. MR. SHULTZ DID. THE FACT THAT MS. HOLMES LATER RECEIVED NOTICE IN 2016 OF PROBLEMS WITH THE LAB, TO CONNECT THE TWO -- ONE, THERE'S NO EVIDENCE IN THE RECORD CONNECTING THOSE TWO. THE GOVERNMENT, AGAIN, DID NOT SHOW MS. HOLMES THE REPORT AND ASK HER, YOU KNOW, DOES THIS LINE UP WITH MR. SHULTZ'S CONCERNS AS YOU UNDERSTOOD THEM? THEY ASKED THE QUESTION AT THE GENERAL LEVEL, AND I BELIEVE HER TESTIMONY WAS THAT IT DID NOT. BUT I DON'T SEE WHERE THE CONNECTION IS BETWEEN THOSE TWO. IT'S, IT'S -- THERE'S EITHER -- THERE'S SOME SORT OF MISSING LINK IN WHAT THE GOVERNMENT SEEKS TO ARGUE. BUT CERTAINLY NOT A REPORT THAT COMES IN FOR NOTICE IN 2016 CAN THEN BE USED RETROACTIVELY TO PROVE THAT MS. CHEUNG OR MR. SHULTZ WAS, IN FACT, CORRECT. PERHAPS THE GOVERNMENT COULD ARGUE SOMETHING AS OF 2016, BUT TO GO BACK EARLIER AND SUGGEST STATE OF MIND IN 2014 USING NOTICE THAT WAS GIVEN IN 2016 SEEMS LIKE WE HAVE A LOGICAL ISSUE.
JUDGE DAVILA: SO I THINK WHAT YOU'RE SAYING IS THAT YOU OBJECT TO IT COMING IN AT ALL, BUT IF IT COMES IN FOR NOTICE, THE NOTICE IS FROM JANUARY 2016 FORWARD, AND THE GOVERNMENT WOULD NOT BE PERMITTED THEN TO ARGUE THAT SHE RECEIVED -- SHE, MS. HOLMES -- RECEIVED NOTICE IN JANUARY OF 2016 AND YOU SHOULD, JURY, LADIES AND GENTLEMEN OF THE JURY, THEN FIND THAT SHE KNEW IN 2013 AND 2014 THAT THERE WERE PROBLEMS. YOU CAN'T USE THAT PIECE OF EVIDENCE. THEY COULD CONSIDER MR. CHEUNG -- OR MS. CHEUNG, MR. SHULTZ AND OTHER INDICIA AS THEY DECIDE THAT, BUT THEY CAN'T USE THE CMS REPORT GOING BACK. IS THAT WHAT YOU'RE SAYING?
MR. LEMENS: I BELIEVE THAT'S A FAIR CHARACTERIZATION, YOUR HONOR.
JUDGE DAVILA: OKAY. MS. VOLKAR?
MS. VOLKAR: YOUR HONOR, IT WON'T SURPRISE YOU TO LEARN THAT THE GOVERNMENT STRONGLY DISAGREES. BUT TWO KEY ISSUES, AND I DON'T WANT TO LOSE SIGHT OF THE FIRST ONE, THE MAIN REASON THAT WE'RE HERE IS THE JURY INSTRUCTION, AND THE GOVERNMENT, AGAIN, STRONGLY OBJECTS TO ANY INSTRUCTION THAT SINGLES OUT A PIECE OF EVIDENCE ALONG THE LINES OF WHAT THE DEFENSE HAS SUGGESTED IN WHAT I THINK IS NOW NUMBER 29. I APOLOGIZE. I'M WORKING OFF OF AN OUTDATED COPY. IN FACT, IN MY SPARE TIME THIS WEEKEND I WENT BACK AND LOOKED AT ALL OF THE DOCUMENTS THAT WERE ADMITTED FOR A LIMITED PURPOSE. THERE'S APPROXIMATELY 20. THE MAJORITY OF THEM ARE AFTER 2016 OR AFTER 2017, INCLUDING, AS WE PUT IN OUR PAPERS, THE MULTIPLE DOCUMENTS DEFENDANTS SUBMITTED FOR PEER REVIEW TO SHOW THAT THE TECHNOLOGY WORKED, INCLUDING SEVERAL THINGS RELATED TO THE AACC CONFERENCE THAT THE DEFENDANT AND OUR TEAM HAS ARGUED WAS RELEVANT TO HER STATE OF MIND TO SHOW THAT THE TECHNOLOGY WORKED. ALL OF THOSE THINGS ARE AFTER THE CMS REPORT AND AFTER A STATEMENT FROM REGULATORS AND HER OWN INTERNAL TEAM, DR. DAS, THAT THE DEVICE, OR AT LEAST A VERSION OF IT, DID NOT WORK, AND THE VERSION THAT THEY WERE USING FOR PATIENTS DID NOT WORK.
JUDGE DAVILA: AND THOSE EXHIBITS WERE ADMITTED BY THE DEFENSE?
MS. VOLKAR: CORRECT, YOUR HONOR. AND THERE WERE -- THERE ARE SEVERAL OTHER CATEGORIES AS WELL, BUT I THINK THAT THOSE ARE THE ONES WITH THE CLOSEST DIRECT TIE BECAUSE THEY ALL RELATE TO WHAT IS THE CAPABILITY OF THE TECHNOLOGY IN 2016. OF COURSE YOUR HONOR ALREADY NOTED THIS, AND THERE IS EVIDENCE TO THIS EFFECT, TWO THINGS: ONE, THE CMS INSPECTORS HAVE SAID IN INTERVIEWS TO THE GOVERNMENT -- OF COURSE THEY DIDN'T TESTIFY AT THIS TRIAL -- THAT THEY TOLD MS. HOLMES OF THE STATE OF THE FINDINGS AND THAT IT WAS GOING TO BE IMMEDIATE JEOPARDY AT THE CONCLUSION OF THE HEARINGS IN FALL OF 2015. THAT EVIDENCE HAS NOT COME IN IN THAT FORM IN THIS TRIAL. WHAT HAS COME IN IN THIS TRIAL -- AND A LOT OF IT, QUITE FRANKLY, THROUGH THE TESTIMONY OF MS. HOLMES THROUGH BOTH CROSS-EXAMINATION AND DIRECT -- IS THAT SHE LEARNED FROM MR. BALWANI THAT THE INSPECTIONS WERE GOING VERY POORLY SUCH THAT SHE FELT SHE HAD TO SHOW UP FOR THE LAST DAY THAT THE CMS INSPECTORS WERE THERE IN NOVEMBER OF 2015. THAT'S FAIRLY IN THE RECORD. THAT'S FAIR FOR THE GOVERNMENT TO ARGUE. I BELIEVE ON CROSS-EXAMINATION THE GOVERNMENT QUESTIONED WHY SHE WAITED UNTIL JANUARY OF 2016 TO SEE THE REPORT TO SORT OF KNOW EXACTLY HOW BAD THINGS WERE AND START CHANGING THINGS. I WANT TO SAY HER ANSWER WAS "I DON'T KNOW." BUT AGAIN, I WANT TO MAKE SURE THAT THE RECORD IS CLEAR OF SORT OF WHAT IS IN THE RECORD TO ARGUE. SHE HAD ENOUGH KNOWLEDGE OF THE STATE OF THE LAB IN FALL OF 2015 TO THINK THAT SHE HAD TO COME BACK FOR THE LAST DAY OF THE CMS INSPECTION. AND THE GOVERNMENT CAN FAIRLY ARGUE FROM THAT. NOW, TURNING TO --
JUDGE DAVILA: AND YOU DON'T NEED THESE TO ARGUE THAT? YOU WOULDN'T NEED 4621A OR B TO ARGUE THAT?
MS. VOLKAR: YOUR HONOR, THAT'S CORRECT. BUT I REALLY DON'T WANT TO LOSE SIGHT OF -- THE DEFENSE HAS REALLY NOT PUT FORWARD ANY ARGUMENT TO STRIKE 4621A AND B, AND THAT'S WHERE I WANTED TO LAND, BECAUSE WHAT I HEARD MR. LEMENS SAY A MOMENT AGO IS "THIS IS LIKE THE 'THE WALL STREET JOURNAL' ARTICLE." THINKING BACK TO THE MOTION IN LIMINE STAGE, THE GOVERNMENT WANTED TO ADMIT "THE WALL STREET JOURNAL" AS WELL. THE COURT STRUCK THAT FOR A HEARSAY PURPOSE. WE'RE IN A VERY DIFFERENT LAND HERE. THE COURT DID NOT STRIKE THAT FOR A 403 PURPOSE. THE DEFENSE ARGUED, I THINK JUST LAST WEEK, 403 IS A RARE REMEDY TO BE USED AND CERTAINLY SHOULDN'T BE -- TO UNDO A COURT'S PRIOR EVIDENTIARY RULING AND NOT ON SORT OF THE THIN READ THAT THEY'RE PUTTING FORWARD. I WANT TO GET THERE IN A MOMENT AS WELL. WHERE I REALLY WANT TO START IS THE INCONSISTENCY IN THE DEFENSE'S POSITION.
THEY BOTH SAY THAT THEY HAVE ALWAYS THOUGHT 4621A AND B CAME IN FOR A LIMITED PURPOSE, BUT THEY MOVED TO STRIKE ON 403 AND CONFRONTATION CLAUSE GROUNDS. THEIR PLEADING YESTERDAY MAKES CLEAR THAT THEY UNDERSTAND THAT THERE'S NO CONFRONTATION CLAUSE ISSUE IF THE TWO EXHIBITS CAME IN FOR A LIMITED PURPOSE. BOTH OF THOSE THINGS CANNOT BE TRUE AT THE SAME TIME. NOW, THE GOVERNMENT'S POSITION IS THAT, IN THE MOMENT, ONE DOCUMENT CAME IN FOR ITS TRUTH, THE COVER LETTER, AND ONE DOCUMENT CAME IN FOR A LIMITED PURPOSE. THE GOVERNMENT UNDERSTANDS IF THE COURT -- AND AS THE DEFENSE PUTS FORWARD IN THE GRANDER CONTEXT OF THINGS, IF EVERYTHING CAME IN FOR A MORE LIMITED PURPOSE FOR HER STATE OF MIND, THAT'S FINE. THEN THERE'S NO CONFRONTATION CLAUSE ISSUES. BUT THEN THERE'S CERTAINLY NO GROUNDS FOR A MOTION TO STRIKE BECAUSE THEN ALL THEY HAVE LEFT WITH IS WHAT MR. LEMENS STARTED WITH, RULE 403, AND THAT'S A VERY THIN READ THAT I WOULD NOW LIKE TO ADDRESS.
BUT I DO WANT TO MAKE VERY CRYSTAL CLEAR, THEY'VE BEEN SAYING "CONFRONTATION CLAUSE." UNDER THEIR VIEW OF THE EVENTS, THAT IT WAS CRYSTAL CLEAR TO EVERYONE IN THE ROOM THAT THE DOCUMENTS CAME IN ONLY FOR A LIMITED PURPOSES, THERE'S NO CONFRONTATION CLAUSE ISSUE. SO TURNING TO THE 403. SO FOR THE 403 CONCERNS, MR. LEMENS TALKED ABOUT HOW THERE'S NO CMS WITNESS TO CONNECT THE DOTS. FIRST OF ALL, THEY HAVE PREVIOUSLY OBJECTED TO, AND OBJECT IN THIS PLEADING, TO THE IMMEDIATE JEOPARDY LANGUAGE. THAT LANGUAGE IS ALREADY IN, AND IT CAME IN THROUGH "THE TODAY SHOW" CLIP THAT CAME IN BECAUSE THE DEFENDANT WANTED, THROUGH RULE 106, THE ENTIRE CLIP TO BE PLAYED. THE GOVERNMENT HAD SUGGESTED JUST MS. HOLMES'S STATEMENTS. THE DEFENSE WANTED THE ENTIRE CLIP TO BE PLAYED. IMMEDIATE JEOPARDY IS IN THE RECORD, AND IN THE RECORD FOR ITS TRUTH. I HAVE NOT HEARD THEM OBJECT TO THAT, BUT I JUST WANT TO POINT OUT THAT EVEN IF THE CMS REPORT GOES AWAY, THAT'S FAIR GAME FOR THE GOVERNMENT TO ARGUE.
SECOND, I WANT TO POINT OUT THAT I'M NOT ENTIRELY SURE WHAT ENTIRE MORE CONTEXT THEY THINK THAT A CMS WITNESS WOULD GIVE TO THESE DOCUMENTS. THERE'S DR. DAS WHO TESTIFIED, WHO WAS ON THE STAND AND SUBJECT TO CROSS-EXAMINATION, WHO THE DEFENDANT HIRED TO ANALYZE AND THOROUGHLY VET THE ISSUES THAT WERE RAISED IN THE CMS REPORT AND GIVE HIS OUTPUT, AND THAT'S EXACTLY WHAT HE DID. SO, AGAIN, I THINK THAT THE DOCUMENT IS IMPORTANT FOR GIVING CONTEXT TO WHAT DR. DAS DID, WHAT DEFENDANT HIRED HIM TO DO, AND ALL OF THE SUBSEQUENT ACTIONS THAT THE DEFENDANT AND THE COMPANY TOOK. AND THE LAST THING I REALLY WANT TO POINT OUT, IT IS IMPORTANT BECAUSE DEFENDANT THEN MINIMIZED THOSE FINDINGS TO INVESTORS IN A LOWLY MANNER TO SORT OF KEEP THE WOOL OVER THE INVESTORS' EYES AND TO AVOID HAVING SORT OF THE SCHEME TO UNRAVEL, AND THAT IS IMPORTANT IN 2016, ESPECIALLY GIVEN ALL OF THE EVIDENCE THAT THE DEFENSE HAS ADMITTED SHOWING HER, THE DEFENDANT'S, STATE OF MIND WITH RESPECT TO THE TECHNOLOGY AFTER THIS REPORT CAME OUT. IT'S A CRITICAL PIECE OF EVIDENCE. RULE 403 IS NOT A BASIS TO OVERTURN THE COURT'S PRIOR EVIDENTIARY RULING, AND THE DEFENSE ESSENTIALLY ADMITS THAT THERE'S NO CONFRONTATION CLAUSE ISSUE HERE.
JUDGE DAVILA: THANK YOU. DR. DAS IN HIS TESTIMONY, IF I RECALL, HE TALKED ABOUT HOW HE WAS HIRED TO LOOK AT THE PROBLEMS, LOOK AT THE ISSUES, AND I THINK BRING IT TO CODE. I FORGET THE PHRASE HE USED. BUT DID HE TESTIFY THAT IN HIS INDEPENDENT REVIEW, HE FOUND DISPARITIES GREATER THAN THE CMS REPORT? AND I THINK HE TESTIFIED ABOUT THAT AND REFLECTED ON SOME OF THE ASSAYS THAT HE THOUGHT HAD PROBLEMS IN ADDITION TO CMS. THAT'S MY RECOLLECTION. IS THAT YOURS?
MR. LEMENS: SO DR. DAS'S TESTIMONY I THINK WE HAVE SEPARATE AND INDEPENDENT CONCERNS WITH, WHICH I DON'T THINK ARE GERMANE OR THAT WE NEED TO TUMBLE OURSELVES INTO TODAY. AND, YOU KNOW, THE TESTIMONY YOUR HONOR IS DESCRIBING, I THINK OUR CONCERN IS WHERE THAT EXPERT LINE IS WITH HIS RETROSPECTIVE ANALYSIS. BUT FOR THE PURPOSES OF THIS DOCUMENT, I THINK THE GOVERNMENT'S POSITION KIND OF SOLVES THE ISSUE, WHICH IS THEY SAY, I BELIEVE ON THE LAST PAGE OF THEIR BRIEF THAT WAS FILED OVER THE WEEKEND, WE DON'T NEED THE REPORT FOR DR. DAS. RIGHT? DR. DAS WAS JUST A VEHICLE TO GET THIS DOCUMENT INTO EVIDENCE. DR. DAS'S TESTIMONY, IN THE GOVERNMENT'S VIEW, STANDS APART FROM 4621. SO I DON'T THINK IT'S REALLY RELEVANT TO THE CONSIDERATION HERE. DR. DAS CERTAINLY LOOKED AT THE REPORT DURING HIS TESTIMONY. HE WAS ASKED TO READ OR SPEAK ABOUT WHETHER HE SHARED PORTIONS OF THAT REPORT WITH MS. HOLMES, OR DISCUSSED PORTIONS OF THAT REPORT WITH MS. HOLMES.
BUT THERE IS, OF COURSE, A SEPARATE -- THERE IS SEPARATE TESTIMONY FROM HIM ABOUT HIS INVESTIGATION AND REVIEW WHICH YOUR HONOR HAS JUST DESCRIBED. ON THAT POINT, DR. DAS, OF COURSE, WAS AND COULD HAVE BEEN -- OR WAS CROSS-EXAMINED ABOUT HIS TESTIMONY. THE CMS WITNESSES ARE UNIQUE -- AND I THINK THIS IS IMPORTANT -- BECAUSE THEY COULD FURTHER EXPLAIN WHAT THE REPORT IS. THEY COULD PROVIDE CONTEXT AROUND THE REPORT. DR. DAS WAS NEVER AN INSPECTOR. I DON'T KNOW IF WE'VE SEEN OR HEARD TESTIMONY FROM ANYONE WITH EXPERIENCE AS AN INSPECTOR. MS. BENNETT HAS SAID IN PRIOR INTERVIEWS AND TESTIMONY THAT CMS DOESN'T DETERMINE WHETHER TESTS ARE ACCURATE. SHE HAS SUGGESTED THAT CMS DOESN'T LOOK AT PATIENT DATA, AND WE BELIEVE SHE WOULD TESTIFY THAT CMS'S CONCLUSIONS ARE, TO SOME DEGREE, SUBJECTIVE, IN ADDITION TO BEING ABLE TO LAY CLEAR FOR THE JURY EVERYTHING ELSE THAT WENT INTO THIS REPORT. THE GOVERNMENT DIDN'T CALL HER. THE GOVERNMENT DIDN'T CALL MR. YAMAMOTO. SO WE'RE LEFT WITH A HOLE IN THE RECORD THAT UNDERLIES THIS DOCUMENT AND THAT, TO US, IS A SIGNIFICANT PROBLEM.
JUDGE DAVILA: OKAY. THANK YOU.
MS. VOLKAR: YOUR HONOR, THE FACT THAT DR. DAS'S TESTIMONY IS SEPARATE FROM 4621, WHICH IT CERTAINLY IS, DOES NOT MEAN THAT 4621 IS THEREFORE INADMISSIBLE. THE PARTIES -- AND THE COURT IS VERY FAMILIAR WITH THIS -- HAVE HAD MANY DISPUTES OVER THE CMS REPORT FOR THE BETTER PART OF THIS PAST YEAR. THIS IS NOT AN ISSUE THAT HAS BEEN LIGHTLY LITIGATED. THIS HAS BEEN THOROUGHLY LITIGATED. AFTER THOROUGH LITIGATION, HEARING THE EVIDENCE, THE COURT OVERRULED THE DEFENSE'S OBJECTIONS AND ADMITTED IT. THERE'S NO 403 REASON TO GO BACK AND OVERTURN THE COURT'S EVIDENTIARY DECISION THAT WAS MADE SOUNDLY WITHIN ITS DISCRETION AND ON THE BASIS OF A LOT OF INFORMATION AND INPUT FROM BOTH SIDES. IT WAS A SOUND DECISION, AND 403 IS NOT A REASON TO GO BACK AND RECONSIDER IT NOW. THE FACT THAT DR.
DAS'S TESTIMONY COULD STAND SEPARATE FROM THAT DOESN'T CHANGE THE FOCUS OF TODAY, WHICH IS WHETHER OR NOT 4621 SHOULD BE STRICKEN FROM THE RECORD AFTER THE CLOSE OF EVIDENCE BEFORE -- AFTER THE GOVERNMENT HAS GIVEN UP ITS RIGHT TO CALL REBUTTAL WITNESSES. ALSO, I WANT TO CORRECT ONE THING THAT MR. LEMENS SAID. HE SAID THAT THERE WAS NO TESTIMONY FROM ANYONE WHO HAD BEEN AN INSPECTOR. THAT'S FALSE. DR. SAWYER TESTIFIED, IN A SIGNIFICANT PORTION OF THE CROSS-EXAMINATION -- AND I THINK MAYBE MR. LEMENS AGREES WITH ME NOW -- BUT A SIGNIFICANT PORTION OF HER CROSS-EXAMINATION WAS ABOUT HER TIME AS AN INSPECTOR AND WHAT SHE HAD DONE. THERE'S A LOT IN THIS RECORD. THERE'S THE CROSS OF MS. CHEUNG AND THE CROSS OF DR. ROSENDORFF WHERE I THINK A GOOD 40 MINUTE CHUNK, OR LONGER, WAS ABOUT THE CMS INSPECTION, HOW OFTEN IT OCCURS, WHAT THEY LOOK AT. THERE'S 40 TO 50 PAGES OF TRANSCRIPT IN HIS CROSS-EXAMINATION ABOUT THAT. THERE'S DR. DAS WHO TESTIFIED. AND THEN THERE IS MS.
HOLMES, WHO ELECTED TO TAKE THE STAND, AND BOTH IN HER DIRECT AND IN HER CROSS TALKED A SIGNIFICANT DEAL ABOUT THE CMS INSPECTION AND WHAT THEY DO AND HOW IT OCCURRED. THERE'S A LOT OF CITES IN OUR BRIEF TO THIS RESPECT, BUT THE RECORD IS REPLETE WITH EXAMPLES OF WHAT CMS IS, WHAT THEY DO, HOW THE INSPECTION OCCURRED, THE FACT THAT THIS WAS A ROUTINE INSPECTION. AND I DON'T MEAN TO RETREAD OLD GROUND, BUT YOUR HONOR DID HAVE A LOT OF THIS INFORMATION BEFORE THE COURT WHEN IT DECIDED, BASED ON THE TOTALITY OF THE RECORD AT THE TIME, TO OVERRULE DEFENSE'S OBJECTIONS AND ADMIT THE REPORT. I UNDERSTAND THE ENTIRETY OF IT, I THINK THIS IS WHERE WE ARE AT IT RIGHT NOW, THE ENTIRETY OF IT FOR A LIMITED PURPOSE, AND THERE'S NO BASIS TO STRIKE IT NOW, AND THERE'S CERTAINLY NO BASIS TO CALL IT OUT IN A JURY INSTRUCTION.
JUDGE DAVILA: OKAY.
MR. LEMENS: I WILL CEDE MS. SAWYER SLIPPED MY MIND, SO I WILL TAKE THAT BACK. BUT NO ONE TESTIFIED TO WHAT HAPPENED AT CMS WITH RESPECT TO THIS INSPECTION AND THIS REPORT. THAT'S, OF COURSE, OUR CONCERN. WE THINK THE GOVERNMENT'S REPRESENTATIONS AND STATEMENTS THAT IT INTENDED TO CALL A CMS WITNESS FROM THE OUTSET OF OUR LITIGATION OVER THIS DOCUMENT SHOWS THE IMPORTANCE THAT THAT HAD. THAT WITNESS DID NOT APPEAR AND THIS DOCUMENT SHOULD THUS BE STRUCK EVEN IF IT WAS OFFERED FOR A LIMITED PURPOSE.
JUDGE DAVILA: OKAY. ANYTHING FURTHER, MS. VOLKAR?
MS. VOLKAR: YOUR HONOR, ONLY TO SAY THAT THE GOVERNMENT'S STATEMENT THAT IT INTENDED TO CALL A CMS WITNESS DOESN'T IMPACT HOW THE EVIDENCE COMES IN AT TRIAL. THE DEFENSE, OF COURSE, MADE REPRESENTATIONS ABOUT CALLING A DEFENSE EXPERT AND DIDN'T DO IT. THINGS HAPPEN AT TRIAL. THAT JUST HAS NO BEARING ON WHAT ACTUALLY OCCURRED AND HOW THE DOCUMENTS WERE ACTUALLY ADMITTED.
JUDGE DAVILA: OKAY. ANYTHING FURTHER?
MR. LEMENS: NOTHING FURTHER.
JUDGE DAVILA: ALL RIGHT. THANK YOU.
MS. VOLKAR: CAN WE TURN TO THE JURY INSTRUCTION, YOUR HONOR, OR --
JUDGE DAVILA: YES, YES. GO RIGHT AHEAD.
MS. VOLKAR: JUST NUMBER 29.
JUDGE DAVILA: YES.
MS. VOLKAR: I THINK THE GOVERNMENT'S POSITION IS CLEAR, BUT WE WOULD LIKE AN INDICATION FROM THE COURT. WE STRONGLY OBJECT TO REALLY ANY INSTRUCTION BEING GIVEN, AND IF THE INSTRUCTION IS GOING TO BE GIVEN, WE ASK THAT IT SIMPLY BE ABOUT ALL EVIDENCE THAT WAS ADMITTED FOR A LIMITED PURPOSE. I PUT TOGETHER A LIST OF THOSE EXHIBIT NUMBERS THAT I'M HAPPY TO SHARE WITH THE COURT AND THE OTHER SIDE, AND WE WOULD PREFER IT JUST BE EXHIBITS ADMITTED FOR A LIMITED PURPOSE, IF ANY INSTRUCTION IS GOING TO BE GIVEN. BUT THE GOVERNMENT'S POSITION IS THAT REALLY THIS IS NOT NECESSARY. THE JURY TOOK NOTES. ONE WAY THAT WE COULD SOLVE ANY CONFUSION IS BY REMOVING THE A AND B SEPARATION AND HAVING IT JUST BE 4621. I THINK THERE ARE A LOT OF DIFFERENT WAYS THAT WE CAN SOLVE THIS WITHOUT AN INSTRUCTION SINGLING OUT ONE PIECE OF EVIDENCE.
JUDGE DAVILA: OKAY. I THINK ONE OF THE ISSUES REGARDING THIS WAS, I THINK IT WAS B THAT WAS ISSUED AND THE COURT ADMONISHED. THE COURT DID NOT ADMONISH ON A, AND THAT'S THE DISTINCTION THAT WE'RE HAVING HERE. SO I'M HAPPY TO LOOK AT WHAT YOU HAVE. THAT MIGHT BE A SOLUTION THAT CAPTURES EVERYTHING.
MS. VOLKAR: YOUR HONOR, ONE THING THAT THE GOVERNMENT DOES WANT TO BE CLEAR ABOUT, THE DEFENSE DID ACCURATELY STATE, IN REFLECTING THE RECORD, THAT 4621A WAS NOT STATED IN FRONT OF THE JURY, AND 4621B WAS NOT STATED IN FRONT OF THE JURY. IT WAS PAGES 1 THROUGH 4 OF 4621, AND PAGES 48 THROUGH 55 OF 4621. MY UNDERSTANDING WAS THAT, FOR CLARITY AFTERWARDS, THAT WAS WHEN THEY WERE SEPARATED. AND SO IF YOUR HONOR READS THE RECORD AND THINKS IT'S CLEAR THAT THE ENTIRETY OF THE PAGES WERE FOR A LIMITED PURPOSE, I DO THINK THAT JUST REMOVING THE DISTINCTION A VERSUS B, WHICH WAS NOT PRESENTED TO THE JURY, WOULD BE AN EASY FIX.
JUDGE DAVILA: WELL, THANK YOU FOR RAISING THAT POINT. THE DEFENSE RAISED IT IN THEIR, IN THEIR BRIEFING, THAT THEY WEREN'T PRESENT AT THE CONCLUSION OF THE DAY WHEN THE EXHIBITS WERE FINALIZED, AS I'VE TASKED YOU TO DO, AND PUT THEM ON THE THUMB DRIVE EVERY DAY. I DON'T KNOW WHY YOU WEREN'T HERE TO DO THAT. MY ASSUMPTION -- NOT YOU -- BUT I DON'T KNOW WHY THERE WASN'T A MEETING. MY ASSUMPTION WAS THAT WAS WHAT WAS HAPPENING, THAT THE DEFENSE AND THE PROSECUTION WERE MEETING, MAKING SURE THAT, AT THE END OF THE DAY, THE COLLECTIVE EXHIBITS THAT WERE ADMITTED WERE ACTUALLY WHAT YOU THOUGHT WERE ADMITTED AND ACCURATELY NUMBERED AND IDENTIFIED SO WE WOULD AVOID, AT THE END OF THE LAST DAY BEFORE JURY INSTRUCTIONS, TRYING TO RENUMBER EXHIBITS AND ALL OF THAT.
MR. LEMENS: I UNDERSTAND, YOUR HONOR. I THINK OUR REPRESENTATION WAS THAT AN ATTORNEY FOR THE DEFENSE WAS NOT PRESENT, AND OF COURSE OUR WONDERFUL TEAM, A MEMBER OF OUR TEAM WAS THERE DOING THE ADMINISTRATIVE WORK. I DON'T THINK ANY SUBSTANTIVE DECISIONS WERE MADE DURING THAT DISCUSSION. I THINK THAT'S THE RELEVANT POINT SO FAR AS WE'RE CONCERNED, NOR WOULD IT HAVE BEEN APPROPRIATE FOR ANY SUBSTANTIVE DISCUSSIONS TO OCCUR AT THAT POINT. BUT WE TAKE YOUR HONOR'S POINT. I THINK -- AND I WILL NEED TO CONFER WITH THE TEAM. WE'RE HAPPY TO CONSIDER, OF COURSE, MS. VOLKAR'S PROPOSALS. WE HAVE NOT SEEN THOSE.
JUDGE DAVILA: SURE.
MR. LEMENS: I THINK THE FACT THAT WE HAVE HAD THIS DISCUSSION BOTH TODAY AND ON FRIDAY SUGGEST THAT PERHAPS SOME CLARIFYING INSTRUCTION IS APPROPRIATE. BUT WE'LL, OF COURSE, AWAIT THE COURT'S GUIDANCE AND WE'LL --
JUDGE DAVILA: WELL, LET ME SAY, I THINK THERE IS. I THINK THERE IS. IT WOULD BE APPROPRIATE, GIVEN THAT WE'VE NOW IDENTIFIED THESE AS A AND B, AND I THINK THE PARTIES AGREE THAT THAT DIDN'T HAPPEN IN FRONT OF THE JURY. IT WAS PORTIONS OF THE DOCUMENTS THAT WERE READ, SO THE JURY DOESN'T KNOW WHAT A AND B ARE. SO IT MIGHT BE BETTER TO COLLECTIVELY REFERENCE ITEMS THAT WERE INSTRUCTED. BUT WE DO -- THE RECORD DOES NEED TO MAKE CLEAR THEN THAT -- BECAUSE THERE'S A GAP. A WAS NOT -- THEY WEREN'T INFORMED THAT IT WAS FOR THEIR -- FOR NOTICE ONLY. THE COURT -- LET ME JUST SAY, I INTEND TO FIND THAT THEY WERE JUST FOR NOTICE, SO WE WILL NEED TO CORRECT THE RECORD, OR IN THE INSTRUCTIONS SOMEHOW TO INDICATE THAT -- INFORM THE JURY THAT THE A PORTION -- WE'LL CALL IT THE A PORTION -- WAS ALSO NOT FOR THE TRUTH, BUT JUST FOR NOTICE.
MS. VOLKAR: YOUR HONOR, IF I MAY SUGGEST A WAY TO DO SO. THERE HAVE BEEN MULTIPLE TIMES THROUGHOUT THIS TRIAL THAT EITHER THE PARTIES OR THE COURT HAVE TURNED TO THE JURY AND SAID, "FOR HOUSEKEEPING PURPOSES, WE WANT TO NOTE THIS." I DO THINK THAT IT COULD BE AS SIMPLE AS, "FOR HOUSEKEEPING PURPOSES, ALL PAGES OF 4621 WERE ADMITTED FOR A LIMITED PURPOSE." AGAIN, THE GOVERNMENT'S POSITION IS THAT IT SHOULD NOT BE SINGLED OUT IN A JURY INSTRUCTION THAT IS GOING TO GO BACK WITH THE JURY. I DO THINK THAT THAT UNFAIRLY PUTS A THUMB ON THE SCALE FOR ONE PIECE OF EVIDENCE WHEN THERE HAVE BEEN MULTIPLE PIECES OF EVIDENCE ADMITTED FOR A LIMITED PURPOSE. I DO AGREE THAT IF WE WANT TO BE CLEAR FOR THE JURY, IT'S WORTH SAYING THAT TO THE JURY IN SOME MANNER, BUT I DO THINK THAT SOMETHING SHORT OF INCLUDING AN INSTRUCTION COULD ACCOMPLISH THAT. AND THE LAST POINT I WANTED TO SAY IS THE COURT, OF COURSE, ORDERED THE PARTIES, AT THE OUTSET OF TRIAL, TO MEET EVERY DAY AND TO FINALIZE THE EXHIBITS BEFORE THEY WERE GIVEN TO THE PUBLIC. I CAN REPRESENT THAT I'VE RELIED AS MUCH ON OUR SUPPORT STAFF AND OUR PARALEGAL, BUT I'VE ALSO, IF I THOUGHT THERE WAS SOMETHING IN DISPUTE, ASKED HER TO NOTIFY ME IF THERE WAS ANY DISPUTE OR ANY ISSUES, AND PART OF WHY I KNOW THE BACKGROUND OF 4621A AND B IS THAT I LEARNED THERE WAS NO DISPUTE AND THAT'S WHY ATTORNEYS WERE NOT NEEDED TO GET INVOLVED. I DON'T WANT TO CAST ANY ASPERSIONS BECAUSE I THINK WE HAVE WONDERFUL PEOPLE --
JUDGE DAVILA: I'M NOT DOING THAT. LET ME BE CLEAR. I'M NOT -- BOTH OF YOUR TEAMS HAVE WORKED TREMENDOUSLY ON THIS CASE, AND I APPRECIATE THEIR EFFORTS. IT'S BENEFITED ALL OF US. AND WHEN I SAY THAT, I MEAN OUR COURT REPORTER, MY STAFF, THE COURT STAFF, I KNOW YOUR TEAMS AS WELL. IT'S BEEN A LONG TRIAL AND THERE'S A LOT OF EXHIBITS. SO IT'S NOT UNUSUAL TO FIND HICCUPS. I'LL CALL THEM THAT.
MR. LEMENS: PERHAPS MAYBE JUST FOR LOGISTICS, MS. VOLKAR AND US AND OUR RESPECTIVE TEAMS COULD DISCUSS AND EITHER COME UP WITH COMPETING PROPOSALS OR PROPOSALS TO THE COURT, PROBABLY TODAY OR AS SOON AS POSSIBLE.
JUDGE DAVILA: I'M HOPING THAT WE CAN -- MY GOAL WAS TO FINALIZE INSTRUCTIONS TODAY SO THAT EACH PARTY WOULD HAVE THEM, INCLUDING THE COURT. AND YOU HAVE TWO DAYS TO PREPARE ARGUMENT. THAT'S PROBABLY MORE THAN YOU NEED, BUT AT LEAST YOU HAVE IT.
MS. VOLKAR: WHAT WOULD BE MOST BENEFICIAL TO THE GOVERNMENT, YOUR HONOR, IS IF THE COURT WERE TO INDICATE -- I THINK THERE ARE MULTIPLE OPTIONS ON THE TABLE. ONE IS IF THE COURT IS INTENDING TO GIVE AN INSTRUCTION ON THE EVIDENCE THAT WAS ADMITTED FOR A LIMITED PURPOSE, AGAIN, THE GOVERNMENT'S POSITION IS THAT THE JURY HAS BEEN TAKING NOTES WHEN THE COURT SAYS IT. I THINK I GAVE ONE EXAMPLE OF HOW THIS PARTICULAR PIECE OF EVIDENCE COULD BE ADDRESSED AS A HOUSEKEEPING MATTER AND NOT IN THE JURY INSTRUCTIONS. IF THE COURT IS INCLINED TO GIVE AN INSTRUCTION, THEN I THINK WHAT MR. LEMENS JUST SUGGESTED OF PROVIDING COMPETING PROPOSALS IS LIKELY THE BEST WAY TO GO. BUT IF THE COURT IS AT ALL SWAYED BY THE GOVERNMENT'S POINT THAT THERE REALLY IS NO NEED TO SINGLE OUT A PIECE OF EVIDENCE LIKE THIS AND THE JURY HAS TAKEN NOTES AND IF WE CLARIFY THIS ONE HICCUP, I THINK THAT WOULD DO IT, THAT WOULD HELP.
JUDGE DAVILA: THANK YOU. I THINK THAT TALKING ABOUT THE EVIDENCE JUST BEFORE THE CLOSING IS NOT MY PREFERENCE. I THINK THAT WOULD BETTER BE ADDRESSED IN AN INSTRUCTION SO THE JURY COULD BE FOCUSSED ON THE ARGUMENTS AND THEN HAVE THE INSTRUCTIONS. IT MAY BE THAT WHOEVER IS GOING TO ARGUE THE CASE WILL REFERENCE THE INSTRUCTIONS. THAT'S WHAT HAPPENS IN CLOSING ARGUMENTS. I WANT THESE TO BE FINALIZED SO YOUR LAWYERS CAN USE THEM AS YOU SEE FIT IN THE CLOSINGS, AND PERHAPS THEY CAN REFERENCE -- INCORPORATE IN THEIR COMMENTS AND REFERENCE THE NUANCES OF THIS TESTIMONY, AS WELL AS ALL OF THE OTHERS. AND I AGREE, MS. VOLKAR, THE JURY HAS BEEN, WHEN I'VE INDICATED -- I THINK THERE'S ONLY ONE JUROR WHO I HAVEN'T SEEN TAKE A NOTE, BUT EVERYONE ELSE IS TAKING NOTES, AND THEY'VE NOTED THAT. SO AT LEAST FOR THAT ONE JUROR WHO PERHAPS HAS A PHOTOGRAPHIC MEMORY, THE INSTRUCTION -- IF NOT, THE INSTRUCTION WOULD BE HELPFUL TO FULLY INFORM AT LEAST THAT ONE JUROR. SO LET'S USE THAT PREMISE, AND I'LL GIVE YOU AN OPPORTUNITY TO WORDSMITH WITH MS. SAHARIA AND SEE IF SOMETHING COULD COME UP.
MS. VOLKAR: THAT WAS GOING TO BE MY LAST QUESTION, YOUR HONOR, WHICH IS I THINK THIS MAY BE THE ONLY OUTSTANDING ISSUE LEFT, OTHER THAN THE "ALLEGED" VERSUS "VICTIMS." I DON'T KNOW IF YOU WANT TO RESOLVE THAT NOW TO TAKE AN ISSUE OFF THE TABLE, BUT MAYBE WE NEED TO INVITE MS. SAHARIA UP.
JUDGE DAVILA: MS. SAHARIA, ARE YOU READY?
MS. SAHARIA: YOUR HONOR, I DON'T HAVE ANY BRILLIANT SOLUTIONS OTHER THAN TO SAY "ALLEGED VICTIMS" OR "INVESTORS" OR PERHAPS "CONDUCT OF INVESTORS IDENTIFIED IN THE INDICTMENT." I'LL STAND ON THOSE TWO COMPETING PROPOSALS FOR THE COURT TO EITHER CALL THEM JUST "INVESTORS" AS THE SECOND SENTENCE ALREADY CALLS THEM, OR TO CALL THEM "ALLEGED VICTIMS."
JUDGE DAVILA: MS. VOLKAR, DO YOU HAVE A PREFERENCE IF THE COURT IS GOING TO MODIFY THAT INSTRUCTION?
MS. VOLKAR: IF THE COURT IS GOING TO MODIFY IT, I THINK THE GOVERNMENT'S PREFERENCE WOULD BE "ALLEGED VICTIMS."
JUDGE DAVILA: WE'LL LEAVE IT "ALLEGED VICTIMS," OR WE'LL ADD "ALLEGED VICTIMS," PARDON ME.
MS. SAHARIA: THANK YOU. AND JUST ONE FINAL POINT. I DID LOOK AT THE COUNTS OF THE INDICTMENT, AND I DO CONTINUE TO OBJECT TO GIVING THOSE TO THE JURY. I THINK THERE'S A NUMBER OF THINGS THAT WOULD EITHER NEED TO BE REDACTED OR THAT WILL CONFUSE THE JURY. SO JUST TO GIVE THE COURT A LIST OF THOSE, FOR INSTANCE, YOU KNOW, EACH OF THE COUNTS INCORPORATES ALL OF THE PRIOR PARAGRAPHS BY REFERENCE, AND I THINK THAT COULD BE CONFUSING TO THE JURY IF THEY DON'T HAVE THOSE PARAGRAPHS. THOSE PARAGRAPHS ARE THE SPEAKING ALLEGATIONS THAT WE PARTICULARLY OBJECT TO, AND SO I THINK THAT GIVING THIS TO THE JURY MIGHT CONFUSE THE JURY. OF COURSE EACH COUNT REFERENCES BOTH MS. HOLMES AND MR. BALWANI. PARAGRAPH 22 TALKS ABOUT INDUCING DOCTORS TO REFER PATIENTS AS PART OF THE CHARGED CONDUCT, WHICH WE OBJECT TO. AND THEN SEVERAL OF THE PARAGRAPHS, PARAGRAPH 24 AND PARAGRAPH 26 REFERENCE THE GOVERNMENT'S NOW ABANDONED DUTY TO DISCLOSE THEORY. THAT WOULD NEED TO BE REDACTED. SO GIVEN THE NEED FOR SOME SORT OF REDACTIONS, I JUST THINK IT WOULD BE UNHELPFUL TO THE JURY. TO GIVE THEM EVEN THE COUNTS WOULD REQUIRE SOME SORT OF REDACTIONS, AND I THINK IT WOULD BE CONFUSING TO THE JURY TO GIVE IT TO THEM. I THINK I HEARD THE GOVERNMENT SAY THAT THEY'RE CONTENT THAT THE INSTRUCTIONS SUFFICIENTLY GIVE THE JURY THE CORE OF THE INDICTMENT, AND WE'RE CONTENT WITH THAT AS WELL, YOUR HONOR.
MS. VOLKAR: YOUR HONOR, I THINK THAT THE PARTIES ARE BOTH GOING TO ARGUE BEFORE THE COURT GIVES ITS INSTRUCTIONS. THE GOVERNMENT IS VERY AWARE THAT THE COURT'S INSTRUCTIONS, OF COURSE, HAVE PARTICULAR SIGNIFICANCE FOR THE JURY. WHAT I RECALL THE DEBATE BEING ABOUT BEFOREHAND WAS A CONCERN OF VARIANCE BETWEEN ANYTHING THE COURT DESCRIBED AND THE INDICTMENT. SO THE GOVERNMENT'S POSITION IS, QUITE SIMPLY, EITHER THE INDICTMENT SHOULD BE READ AS IS OR SOME PORTION, OR THE INSTRUCTION SHOULD BE GIVEN JUST AS THE PARTIES HAVE AGREED. SO IF THE DEFENSE IS CONTENT WITH THE INSTRUCTIONS AS THE PARTIES AGREE, THEN THAT'S FINE BY THE GOVERNMENT AS WELL.
JUDGE DAVILA: OKAY. ALL RIGHT. THANK YOU. WHEN I LOOK AT THE DOCUMENT 469, WHICH IS THE THIRD SUPERSEDING INDICTMENT, PAGE 9, FOR EXAMPLE, LISTS COUNTS THREE THROUGH EIGHT. PAGE 10 LISTS COUNTS NINE THROUGH TEN IN THE GRAPHICAL BOXES. THAT'S WHAT I WAS THINKING MIGHT BE HELPFUL TO THE JURY. BUT PERHAPS --
MS. SAHARIA: I DON'T OBJECT TO THE BOXES, BUT I DO THINK THAT THE CONTENT OF THE BOXES HAS BEEN INCORPORATED INTO THE INSTRUCTIONS, AT LEAST THE DATE AND THE AMOUNT AND THE CORRESPONDING COUNTS. SO I THINK THEY HAVE THE CORE OF THAT INFORMATION.
JUDGE DAVILA: WELL, IF IT'S GOING TO BE PROBLEMATIC -- YOU KNOW, I'D LIKE TO THINK I'M A PROBLEM SOLVER THAN A PROBLEM CREATOR, SO LET'S LEAVE IT AS IS AND WE'LL LEAVE IT UP TO YOU TO DECIDE HOW TO PRESENT THE INFORMATION TO THE JURY FOR YOUR BEST BENEFIT. OKAY?
MS. SAHARIA: BOTH PARTIES ARE CAPABLE OF DOING THAT, YOUR HONOR.
JUDGE DAVILA: I THINK SO. I THINK SO. ALL RIGHT.
MS. SAHARIA: SO WE JUST OWE THE COURT THEN THE PROPOSAL AND THE CMS REPORT INSTRUCTION?
JUDGE DAVILA: RIGHT. RIGHT. I KNOW YOU'RE GOING TO WORK HARD ON THAT. AS I SAID, I WOULD LIKE TO GET THE INSTRUCTIONS SETTLED.
MS. SAHARIA: WE'LL DO THAT AS SOON AS WE GO BACK TO OUR RESPECTIVE WORKPLACES, YOUR HONOR.
JUDGE DAVILA: OKAY. GREAT. I'LL EAGERLY AWAIT YOUR WORK PRODUCT. ANYTHING ELSE BEFORE WE BREAK?
MS. VOLKAR: NO, YOUR HONOR.
MS. SAHARIA: YOUR HONOR, MR. DOWNEY MAY HAVE SOMETHING.
JUDGE DAVILA: YES.
MR. DOWNEY: THIS IS A VERY SMALL ISSUE, YOUR HONOR, BUT YOUR HONOR HAD RAISED THE ISSUE ON FRIDAY AND I THINK ONE TIME BEFORE ABOUT WHETHER THE JURY SHOULD HAVE THE WRITTEN INSTRUCTIONS AS THEY'RE CHARGED.
JUDGE DAVILA: RIGHT.
MR. DOWNEY: OBVIOUSLY IT'S THE COURT'S PREFERENCE, BUT MY REACTION UPON THINKING ABOUT IT IS THAT, YOU KNOW, AMONGST 12 PEOPLE WE HAVE PEOPLE WHO LEARN DIFFERENTLY, AND I THINK GIVING THEM THE INSTRUCTIONS WHILE YOUR HONOR IS CHARGING THEM ORALLY IS LIKELY TO CAUSE THEM TO FOCUS ON THE WRITTEN DOCUMENT. SO OBVIOUSLY WITHOUT ANY MAGIC, BUT MY OWN PREFERENCE WOULD BE IF THEY LISTEN TO YOUR HONOR WHILE THEY DON'T HAVE THE DOCUMENT, OBVIOUSLY THEY WILL HAVE THE DOCUMENT LATER. SO I JUST WANTED TO PROVIDE THAT FEEDBACK.
JUDGE DAVILA: DO YOU HAVE AN OPINION ON THIS, MS. VOLKAR?
MS. VOLKAR: THE GOVERNMENT DEFERS TO THE COURT. I BELIEVE THE COURT'S TYPICAL PRACTICE IS TO READ IT ORALLY AND THEN PROVIDE A WRITTEN VERSION LATER. AS MR. DOWNEY SUGGESTS, THAT COVERS ALL TYPES OF LEARNERS, AND I THINK THAT WOULD BE FINE WITH THE GOVERNMENT.
JUDGE DAVILA: OKAY. THAT'S WHAT I'LL DO THEN. THAT'S BEEN MY NORMAL PRACTICE, AS I INDICATED. I WANTED TO INQUIRE OF THE PARTIES WHETHER THE COURT SHOULD DEVIATE FROM THAT. ALL RIGHT. THANK YOU. MR. DOWNEY, DID YOU -- AND I THINK MR. SCHENK WAS PART OF THE DISCUSSION -- DID YOU REACH SOME AGREEMENT ON A SCHEDULING OR A BREAKING OF THE ARGUMENTS AND WHETHER YOU WANT TO INVOLVE ME IN THAT?
MR. DOWNEY: YOU KNOW, YOUR HONOR, I THINK MR. SCHENK IS PROBABLY STILL DECIDING ON OVERALL LENGTH. THAT'S WHERE HE WAS ON FRIDAY.
JUDGE DAVILA: AND I'M NOT ASKING YOU TO COMMIT. I JUST WANT TO KNOW IF YOU WANT ME TO BE --
MR. DOWNEY: I THINK I'LL IDENTIFY TO HIM IN ANY EVENT WHEN A BREAK IS NEEDED, AND I THINK HE CAN PLAN AROUND THAT I ASSUME.
JUDGE DAVILA: MR. SCHENK?
MR. SCHENK: YES. MY UNDERSTANDING, FROM OUR DISCUSSION ON FRIDAY, WAS THAT DURING THE TRIAL WE HAVE TENDED TO TAKE BREAKS AROUND 11:30, AND THE GOVERNMENT, IF ITS CLOSING IS STILL GOING ON AT THAT POINT, MAYBE COULD FIND A CONVENIENT TIME TO STOP RIGHT AROUND THAT TIME, LET'S SAY SOMETIME BETWEEN 11:00 OR 11:30, OR SOMEWHERE AROUND THERE, AND I THINK THAT WOULD BE THE PLAN IS I'LL TRY TO PAY ATTENTION TO THE CLOCK AND LOOK UP AND OFFER A TIME. BUT I ALSO --
MR. DOWNEY: I THINK, JUST FOR RESOLUTION OF IT AND CONSISTENT WITH OUR PRACTICE, I WOULD SAY LET'S BREAK AT 11:15 AND HE CAN PLAN AROUND THAT.
MR. SCHENK: YES, I'LL DO MY BEST. SOMETIMES ONE GETS LOST.
MR. DOWNEY: UNDERSTOOD.
JUDGE DAVILA: BUT NO LATER THAN 11:30. DOES THAT WORK?
MR. DOWNEY: I THINK THAT'S FINE, YOUR HONOR.
MR. SCHENK: SURE.
JUDGE DAVILA: AND THAT WILL BE A 30 MINUTE BREAK?
MR. SCHENK: YES.
MR. DOWNEY: YES.
JUDGE DAVILA: OKAY. AND THEN WE'LL COME BACK AND FINISH WHATEVER. IF YOU FEEL -- IF EITHER PARTY FEELS THAT, NOTWITHSTANDING OUR SCHEDULED BREAKS -- WE'LL DO 11:30, AND THEN IS IT 1:30?
MR. DOWNEY: I THINK THAT'S RIGHT, YOUR HONOR.
JUDGE DAVILA: IF YOU FEEL THAT WE NEED TO TAKE A BREAK FOR WHATEVER REASON, YOU SHOULD LET ME KNOW, OR PLAN THAT IN YOUR ARGUMENTS. IF YOU'RE GOING TO GO THREE MORE HOURS, WE PROBABLY SHOULD TAKE A BREAK. OKAY. THAT'S HELPFUL.
MR. DOWNEY: THANK YOU, YOUR HONOR.
MR. SCHENK: THANK YOU.
COURT CLERK: COURT IS ADJOURNED.
(COURT ADJOURNED AT 10:37 A.M.)