1 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF

Transcription

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NORTH CAROLINA
STATESVILLE DIVISION
5:09CR27-1
UNITED STATES OF AMERICA
v.
BERNARD VON NOTHAUS
Post-Conviction Motions Under
Rules 29, 33, and 34 of the
Fed.R.Crim.Proc.
The defendant Bernard von Mr. von NotHaus through counsel moves for
relief from the jury verdict pursuant to Rules 29, 33, and 34 of the Federal Rules of
Criminal Procedure.
Under Rule 29, of the Federal Rules of Criminal Procedure, a “defendant
may move for a judgment of acquittal, or renew such a motion, within 14 days
after a guilty verdict or after the court discharges the jury, whichever is later.” Rule
29(c)(1). Judgment of acquittal is appropriate where “the evidence is insufficient to
sustain a conviction.” Rule 29(a). For the reasons stated herein, there was
insufficient evidence that the Liberty Dollars were counterfeits of United States
coins and that Mr. von NotHaus acted with the necessary criminal intent.
The Court “may vacate any judgment and grant a new trial if the interests of
justice so requires.” Rule 33(a), Fed.R.Crim.Proc. A Rule 33 motion “must be filed
within 14 days after the verdict or finding of guilty.” Rule 33(b)(2). For the reasons
stated herein, the jury rendered a verdict on improper bases, which can be correctly
only through a new trial.
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Case 5:09-cr-00027-RLV -DCK Document
Filed 03/31/11 Page 1 of 50
The Court “must arrest judgment if the indictment or information does not
charge an offense.” Rule 34(a)(1), Fed.R.Crim.Proc. A Rule 34 motion must be
made “within 14 days after the court accepts a verdict or finding of guilty.” Rule
34(b), Fed.R.Crim.Proc. For the reasons stated herein, the grand jury was given
bad legal advice as shown in the indictment, including paragraph 33, and when
viewed in the proper light of the correct law the indictment does not charge an
offense.
The jury was given the following instruction as to Count One, conspiracy to
violate 18 U.S.C. §§ 485 and 486, in violation of 18 U.S.C. § 371:
In order to find Defendant guilty of the conspiracy charge alleged in
Count One of the Bill of Indictment, the Government must prove the
following essential elements beyond a reasonable doubt before there
could be a conviction. For your information, the first essential
element has to do with the existence of a conspiracy; the second with
membership in a conspiracy; the third with the alleged objects of the
conspiracy; and the fourth involves the requisite overt acts. More
particularly, here are the essential elements the Government must
prove beyond a reasonable doubt before there could be a conviction:
That on or about the dates alleged, within the Western District of
North Carolina –
5) The conspiracy, agreement, or understanding described in Count One of
the Bill of Indictment [January 1998 thru May 19, 2010] was formed,
reached, or entered into by two or more persons;
2)
At some time during the existence or life of the conspiracy,
agreement, or understanding, the Defendant knew the purpose
of the agreement, and, with knowledge, then deliberately joined
the conspiracy, agreement, or understanding;
3)
The alleged object of the conspiracy was to violate either (or both):
- 18 U.S.C. §485
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4)
·
to falsely make, forge or counterfeit any coin in
resemblance and similitude of coins of a
denomination higher than five cents, or in actual
use and circulation as money within the US
·
pass, utter, publish, sell, or possess any false,
forged, or counterfeit coin, knowing the same to be
false, forged or counterfeit, with intent to defraud
- 18 U.S.C. §486
·
to make, utter or pass [attempt to make, utter or
pass] counterfeit coins of silver intended for use as
current money, in resemblance of genuine coins of
the US, or of original design; and
At some time during the existence or life of the conspiracy,
agreement, or understanding, one of its alleged members
knowingly performed one of the overt acts charged in the
indictment and did so in order to further or advance the purpose
of the agreement.
The jury was instructed as follows on Count Two, making and distributing
counterfeit coins in violation of 18 U.S.C. §485:
In order to find Defendant guilty of the offense alleged in Count Two
of the Bill of Indictment, the Government must prove the following
essential elements beyond a reasonable doubt before there could be a
conviction. That on or about the dates alleged, within the Western
District of North Carolina:
Section 1 / First Avenue of Proof:
[Making counterfeit coins]
1)
Defendant falsely made, forged or counterfeited coins; and
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2)
The falsely made, forged or counterfeit coins were in
resemblance and similitude of coins of a denomination of higher than
five cents; or
3)
The falsely made, forged or counterfeit coins were in actual use
and circulation as money within the United States; or
4)
The Defendant otherwise aided, abetted, counseled,
commanded, induced, or procured the commission of this offense.
Section 2 / Second Avenue of Proof:
[Passing / uttering counterfeit coins with intent to defraud]
1)
Defendant passed, uttered, published, sold, or possessed any
false, forged, or counterfeit coins;
2)
Defendant did so knowing the coins to be false, forged or
counterfeit; and
3)
The Defendant did so with the intent to defraud; or
4)
Defendant otherwise aided, abetted, counseled, commanded,
induced, or procured the commission of this offense.
The jury was instructed as follows on Count Three, making and distributing
counterfeit coins intended for use as currency money in violation of 18 U.S.C.
§486:
In order to find Defendant guilty of the offense alleged in Count
Three of the Bill of Indictment, the Government must prove the
following essential elements beyond a reasonable doubt before there
could be a conviction. That on or about the dates alleged, within the
Western District of North Carolina:
5)
Defendant knowingly made, uttered or passed, [or attempted to
make, utter or pass], coins of silver;
2)
The coins were in resemblance of genuine coins of the United
States; or
3)
The coins were of original design; and
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4)
The Defendant intended the coins for use as current money; or
5)
Defendant otherwise aided, abetted, counseled, commanded,
induced, or procured the commission of this offense.
The jury was given a copy of the indictment with paragraph 33 redacted.
The redaction consisted of incorrect legal conclusions about the law, specifically,
that, “It is a violation of federal law for private coin or currency systems to
compete with the official coinage and currency of the United States.” The term
“coin” used in conjunction with “private” is an oxymoron because the term “coin”
has a special meaning, specifically, that it is minted by the United States.
The jury returned a verdict of guilty on all three counts and on all avenues of
proof in Count Two. We believe that the evidence is insufficient to support the
jury’s verdict and that the government painted NORFED, Liberty Dollar, Mr. von
NotHaus, and the governing law in a false light, resulting in an indictment that
does not charge an offense under the correct statement of the law, and an unfair
trial and a wrongful conviction. The government has consistently presented bad
legal advice to the grand and petit juries about the status of private currency and
the freedom to choose a medium of exchange in an effort to obtain by coercion
what the Constitution and even Congress prohibit, and using the criminal justice
system to impose upon everyone policy choices preferred by the government. This
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is clear from the government’s actions, including the government’s misleading and
prejudicial public press release made on the day of the verdict. Exhibit A.
The government advocated the
 the use of the Liberty Dollar as a circulating currency,
 the “Do the Drop” promotion of the Liberty Dollar,
 the pyramid, multi-level marketing system of distribution using
regional currency officers, associates, and merchants, and
 the profit motive associated with the discounting of the Liberty Dollar
at the regional, associate, and merchant levels of distribution.
The defense advocated
 the legitimate mission and purpose of the Liberty Dollar as a protest
against the current monetary system including the instrumental role of
the Federal Reserve in buying coin and currency from the United
States Treasury at face value, rather than cost, in what has been
described as a Ponzi scheme that creates inflation and a redistribution
of wealth,
 the use of the Liberty Dollar as an educational tool that facilitates
discussion of these important monetary and economic issues,
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 the benefits to the individual and community of having a private
barter value based currency that functioned parallel to and was
interchangeable
with
United
States
currency
by
means
of
denominations similar to Federal Reserve Notes,
 the dissimilarities in appearance, weight, denomination, intrinsic
value, and marketing of the Liberty Dollar compared to United States
coin,
 the extensive promotion of the Liberty Dollar in the media and
promotional materials as something in competition with rather than
counterfeiting United States currency, and not legal tender or
bankable,
 the use of the discount of the Liberty Dollar to regional currency
officers, associates, and merchants to cover costs and the general lack
of a net profit, compared to the excessive markup and profit going to
the United States Treasury from the sale of United States coin and
currency, and
 the reliance by NORFED, Liberty Dollar, and Mr. von NotHaus upon
legal advice from attorneys, general literature on private currencies
and monetary and economic policy, and statements by the Federal
Reserve, United States Treasury, and Secret Service to believe that the
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Liberty Dollar was legal and that the United States Mint’s subsequent
press release challenging the legitimacy of the Liberty Dollar eight
years into its existence was untenable, and certainly not definitive or
the appropriate subject of a criminal proceeding.
The case agent Romagnuolo was allowed to testify over the objection of the
defense that a “detective told me that they had attempted to pass a fake coin that
looked similar to United States coinage at that branch location.” (Tr. 3/8/11, p. 14).
This referred to what an employee of the State Employees Credit Union had said to
the detective. Id. This was testimony of an out-of-court statement of an out-ofcourt statement that did not afford the in-court confrontation of the SECU
employee or detective, in violation of the Sixth Amendment. More importantly, it
misled the jury by the incorrect use of the term “coin” and the argumentative terms
“fake coin that looked similar to United States coinage.”
This was improper opinion testimony invading the province of the jury. It
also lacked any indicia of reliability as to the accuracy of what actually happened
at the credit union, whether someone attempted to deposit it and what happened as
a consequence. There was no one to cross exam those circumstances, to identify
what Liberty Dollar was presented, what its markings and weight were, whether
the credit union or customer contacted the phone number or website address on the
Liberty Dollar, whether the credit union or customer ultimately decided to keep the
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Liberty Dollar or sought to return it to NORFED or the regional currency officer,
associate, or merchant involved. The testimony was a cheap shot at the expense of
the truth.
Case agent Romaguolo also made reference to seeking the opinion of the
Chief Counsel for the Secret Service about the Liberty Dollar. (Tr. 3/8/11, p. 15).
By testifying that as a result, he “initiated a federal investigation related to the
currency violations,” the case agent was allowed to give the jury an inadmissible
hearsay opinion. It also deceived the jury about the opinion, because the actual
opinion was that there was not a violation of 485, because “the Liberty Coins are
not counterfeits of or in similitude to any official United States coins.” See Exhibit
B, p. 3. The case agent forgot to mention this and he testified as to his opinion to
the exact opposite conclusion, even as he attributed it to the Secret Service opinion.
The case agent continued, over the objection of the defense, to invade the
province of the jury with inflammatory statements about NORFED and Liberty
Dollar. (3/8/11, p. 15). For example, he used the phrase, “whose purpose was to
distribute this fake currency,” when ask what actions he took to gather information
Id. In this particular instance, he was improperly expressing an opinion as to the
“purpose” to the distribution of the Liberty Dollar and an improper opinion as to
the status of the Liberty Dollar as “fake.”
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The case agent responded to evidence of Mr. von NotHaus’ honest business
dealings with the derogatory reference to “fake currency.” (Tr. 3/18/11, p. 54). The
agent reviewed the audits of NORFED, Liberty Dollar, and Sunshine Mint posted
on the Liberty Dollar website and the records seized from the auditing firms, and
all he could say is that “they confirmed that he had the amount of fake currency
that he said he did.” Id.
The case agent testified that he obtained a list of merchants in Asheville
accepting Liberty Dollars and started to go to them. (Tr. 3/8/11, p. 16). He went to
Express Emporium. Id. They were out of stock and referred him to the Fresh
Quarter. At the Fresh Quarter, he observed Liberty Dollar marketing materials and
a merchant list. The cashier “indicated that she had Liberty Dollars in the cash
register and would provide them to me as change if I wished to buy something or
that I could purchase them.” Id.
This contradicts the theory of the government’s own case. There was
literature to draw the public’s attention to the competing nature of Liberty Dollar.
There was a cashier who was open and honest about the offer of Liberty Dollars as
change. There was nothing deceptive about it. This testimony supported the
government’s case only if private currency systems were illegal and it was illegal
to compete with the official currency of the United States. That is exactly the
picture the government was trying to paint in a subtle and deceptive way.
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The case agent tainted the jury with testimony “that there were a number of
subjects that were in my sovereign citizen case that were also Liberty Dollar
associates.” (Tr. 3/8/11, p. 18). This Court sustained the objection, but that did not
cure the disease that was beginning to infect this case from beginning to end. The
case agent proceeded to say that use of an undercover FBI agent was called for by
the “difficulties” and “other issues” presented by this situation. Id.
The case agent was allowed to testify over the objection of the defense about
the 2006 United States Mint press release warning that “we felt it was necessary to
warn the public because in essence this is what I view as a pyramid scheme or a
multilevel marketing … scheme where the defendant’s at the top of the pyramid.
He brings in these regional currency officers who are located throughout the
country, who then in turn recruit Liberty Dollar associates or merchant businesses
and they’re all part of that pyramid.” (Tr. 3/8//11, p. 32-33).
This was a total disregard of the express prohibition in Rule 803(8) of the
Federal Rules of Evidence and Beech Aircraft v. Rainey, 488 U.S. 153 (1988), of
factual findings, conclusions, and opinions derived from an investigation made
pursuant to law against a defendant, and a violation of Crawford v. Washington,
541 U.S. 36 (2004). When the defense tried to confront this impermissible
testimony with a question of where in the code is it against the law for a citizen to
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violate an opinion of the Department of Justice, this defense was disallowed and
Mr. von NotHaus silenced. (Tr. 3/9/11, p. 109).
Note that he did not say that the press release by the Mint was necessary
because of counterfeiting, the only legitimate issue for the jury. Instead, it’s a FTC
trade practices matter that the case agent is allowed to testify to with the freedom
to opine about there being a scheme involving a pyramid or multilevel marketing.
This invited bias and a verdict based on improper bases such as whether there was
a pyramid or multilevel marketing or that such a distribution channel is legal.
The agent furthered this theory and the single currency theory.
It’s not a one time thing because as they continue to purchase the
currency to put it into circulation, they are making money by
distributing it to unknowing individuals. The RCOs in turn are making
money distributing it to the merchants and the associates. And Mr.
von Mr. von NotHaus is making money off of every single
transaction. So it’s not just a one time sign up of a RCO or a merchant
or an associate. It’s a gift that keeps on giving. (Tr. 3/8/11, p. 53).
This is an interesting and unsupported theory of multilevel marketing and
legal business practices, but has nothing to do with counterfeiting. It and
subsequent refrains of these theories only served to further confuse the jury. It’s
not even supported by the agent’s own personal observations of the use of the
Liberty Dollar. There is no factual basis to support the improper opinion. Not even
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the undercover agent would adopt the case agent’s use of the terms pyramid or
multilevel marketing, although she did preach about profits. (Tr. 3/9/11, p. 75-76).
Furthering the FTC fair trade practices notion, the agent testified, not that
the Liberty Dollars were counterfeits of the United States currency, but that the
consumer needed to know that the intrinsic value was less than the face value. (Tr.
3/8/11, p. 32-33).
The problem occurs when these coins that they’re distributing
in currency leave the pyramid of the people who are educated about
the Liberty Dollar Organization and they distribute them by making
change with no further information to unsuspecting people in those
businesses. They could end up with a 10, 20, or even 50 dollar coin
that’s worth half, or in some cases less than what the coin is marked
as.
So we felt it necessary to do a consumer advisory through the
United States Mint.
This introduced a new theory of criminal liability uncharged by the grand
jury and made it a matter of whether there was sufficient notice on or about the
Liberty Dollar to the consumer to know the intrinsic value of the silver. The agent
subsequently contradicts this assertion, saying the intrinsic or numismatic value of
the Liberty Dollar is irrelevant. (Tr. 3/8/11, p. 74-75). This could only serve to
confuse the jury about the proper basis for their verdict.
Looking at the silver content of the Liberty Dollar, it does a poor job of
counterfeiting United States currency. The intrinsic value of the silver in the
Liberty Dollar is much greater than the intrinsic value of the base metals and paper
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of United States currency. The jury verdict may on the surface suggest a new
definition of counterfeit where the fake is worth more than the genuine, but
looking beyond the surface, we see a bait and switch by the government. Charge
counterfeiting, but convict on something else.
The case agent testified that he was able to get a search and seizure warrant
from a federal judge, and by implication this suggests that there is a factual and
legal basis for the search and seizure. (Tr. 3/8/11, p. 40). The government is using
the federal judge to vouch for the factual and legal basis of the search and seizure
and the case as a whole. The prosecutor isn’t missing a trick in selling this case to
the jury. It is this Court that has supervisory responsibility for protecting the public
from unfair or deceptive or misleading trade practices in prosecuting this case.
The case agent argued that the “Liberty Dollar Organization during the
investigation came up with a state-by-state Liberty Dollar. … And it was
introduced about the same time as the United States currency coinage quarters
which had a state-by-state marking on the back of them.” (Tr. 3/8/11, p. 42-43).
The undercover agent also testified about this and the North Carolina Liberty
Dollar underwritten by Innes and Vernon Robinson. (Tr. 3/9/11, p. 22-23). If as
the government maintained in paragraph 33 of the indictment and in its postconviction press release that it is illegal to compete with the United States currency
and that a single currency system is mandatory, then this example of competition
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would have relevance to the case. It is this false light cast upon the evidence
throughout the trial that tainted the jury’s verdict.
The case agent also falsely claimed that the competing state programs were
introduced at about the same time, when in fact the government’s state quarter
program was signed into law in 1997 and began distribution in 1999, seven years
before the Liberty Dollar program began in 2006.
The case agent also falsely suggested that the Liberty Dollars competed with
United States coin, when in fact they competed with Federal Reserve Notes. The
government piled one red herring on top of another in an effort to confuse the jury
and to get the jury to render a verdict on an improper basis or bases.
A similar example is seen in the case agent’s choice of words in describing
merchant Belsito’s receipt of Liberty Dollars. (Tr. 3/8/11, p. 46). He says that the
“Liberty Dollar was actively being utilized in the community as currency.” Id. If a
competing currency is illegal then this is relevant, albeit bordering on opinion
testimony. It is consistent with the improper theme developed by the government
that it is illegal to compete with the United States currency. This theme tainted the
case and the verdict.
Yet another example of shifting the question from counterfeiting to these
other themes of single currency and hapless consumer is the case agent’s testimony
that, “it was easily mixed with United States coinage.” (Tr. 3/8/11, p. 55). This
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concerned the parallel feature of the Liberty Dollar that made it a complement to
United States currency, easily converted by merchants and consumers into Federal
Reserve Notes and from Federal Reserve Notes to Liberty Dollars. It is this “mix in
currency money” that the case agent testifies makes the Liberty Dollar counterfeit.
(Tr. 3/8/11, p. 56). Please note that banks do not accept the Liberty Dollar as
shown by how this case got started, according to the case agent. (Tr. 3/8/11, p. 73).
So there is no basis for the fear sold to the jury by the agent that Liberty Dollars
are mixed into the United States currency system.
The case agent argued that it wasn’t the face of Liberty on the Liberty
Dollar, “in and of itself” that was the crime, but “the use of that currency and its
similar appearance.” (Tr. 3/8/11, p. 55). The term “use of that currency” is the
prejudicial addition to the equation that was constantly driven home by the
government. As to similarities with United States coins, the case agent admitted
that he was not trained to identify counterfeits, but added that the Secret Service
provided that expertise. (Tr. 3/8/11, p. 55). This case agent was acting more as
advocate than fact witness and put before the jury way too much prejudicial
material and improper testimony.
The case agent argued that in evaluating the counterfeit nature of the Liberty
Dollar, it wasn’t the unique marking on the Liberty Dollars that it contained one
ounce of .999 silver, but, “The dollar denominations,” the Liberty Statue head, and
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reference to God that in totality made it “similar.” (Tr. 3/8/11, p. 57). Again, he is
using the competitive feature, the dollar denominations that provide for
convertibility, to characterize the Liberty Dollar as illegal. He also is ignoring the
fundamental question of what United States coin does the Liberty Dollar
counterfeit? By denomination, dimension, weight, silver content, and markings,
there is no United States coin it competes with because it was not intended to
compete with coin, but with Federal Reserve Notes. The government distracted and
confused the jury on this point. There is no circulating United States coin with a
face value of $5, $10, $20, or $50.
The case agent testified that, “When they were mixing it, as merchants
passed it as change, there was no statement of this is a Liberty Dollar.” (Tr. 3/8/11,
p. 59). Based upon the agent’s earlier testimony about his initial investigation and
experience at the Fresh Quarter, this was at best misleading and at worst perjury.
To say under oath that, “It was just simply given out mixed in United States
currency,” is false and misleading. Even the government’s own Exhibit 44, a
distributed Liberty Dollar brochure, distinguishes it from United States currency,
saying it’s inflation proof, does not add to the national debt, is not bankable, and
that it can be used to barter with any business that wants to take it and the bank
doesn’t have to accept it. (Tr. 3/8/11, p. 71).
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As to the Ron Paul and Second Amendment Dollars, the case agent
explained that, “they were seized because they were making money for the
organization and it was all being reintroduced and utilized to further the creation of
Liberty Dollars.” (Tr. 3/8/11, p. 58). Note that there was no evidence showing that
a profit was generated by these items. The evidence tended to show that there
wasn’t even a profit generated by the Liberty Dollar. At best they were recovering
most of their expenses and capital. This is an odd way to counterfeit, sort of a
nonprofit version of crime, we will call it Robin Hood counterfeiting, where it is
done not for the benefit of the people who dedicate their time and money to the
effort but for the benefit of society as a whole. The only problem is that it is not
really counterfeiting.
The case agent agreed that the Liberty Dollars “legitimately contain that
which they presented on the face of the medallion itself.” (Tr. 3/8/11, p. 58). But,
according to the case agent people involved might not know that the Liberty Dollar
had one ounce of silver in it because they might not actually look at or read what is
written on the Liberty Dollar. (Tr. 3/8/11, p. 58). The agent also said that people
would read the denomination on the Liberty Dollar and not know that their value
was not as marked. There seems to be some inconsistency here and with the earlier
testimony about the displays at Fresh Quarter and statements by the cashier. It was
mixed with United States currency but distinguished from United States currency.
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It had more intrinsic value unlike the Federal Reserve Notes it competed with and
merchants were willing to enter into voluntary barter arrangements with it, but
people, according the agent were clueless about it, not reading what it said or what
the displays said, or what the cashier said.
The case agent explained to the jury that it does not matter whether the
Liberty Dollar has intrinsic value and the Kennedy half dollar does not, because
the Kennedy half dollar is “legally authorized to be passed as currency by the
United States government and it is the official currency of the United States.” (Tr.
3/8/11, p. 59-60). The emphasis here by the agent is on “legally authorized” and
“official currency,” which incorrectly suggests that private currencies are not legal
or authorized and that only official currency is legal and authorized.
The case agent refused to acknowledge that the official currency is not
backed by any intrinsic value of the Federal Reserve Notes with which the Liberty
Dollar competed or even United States coin. (Tr. 3/8/11, p. 60). It is by fiat worth
what the government says its worth. Id. This ignores the fair market value of the
official currency and the market forces that determine value in relation to the goods
and services money can buy. To overcome this obstacle, the government will
attempt to force transactions at the value it assigns to the official currency. The
government has less power to do this if there are alternative currencies, which is
why the government is trying to craft a monopoly out of this case.
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The case agent was inconsistent in his characterization of the $50 Liberty
Dollars seized at Sunshine Mint, “Warehouse Receipts that we collected from the
Sunshine Mint had already been redeemed and there are people who are ostensibly
holding Warehouse Receipts with the promise that NORFED or the Liberty Dollar
Organization would then give them silver if they decided to redeem it.” (Tr. 3/8/11,
P. 63-64).
He says there is evidence that redemptions were honored, and then he uses
the word “ostensibly” to bring into question the status of the seized Liberty Dollars
as being subject to the claims of holders of the warehouse receipts. He doesn’t
explain why he questions this, but does go on to say, “Those Warehouse Receipts
are floating out there and have not been redeemed.” (Tr. 3/8/11, p. 64). Please note
that he testifies that the warehoused Liberty Dollars are in the $50 piece minted in
2008, which contains the “MSRP,” the “PVBC,” “Notice – Not Intended to Be
Used as Legal Tender, Current Money, or Coin,” “888.LIB.DOLLAR,” and
“LiberyDollar.org” The jury verdict did not specifically find this version to be a
counterfeit coin, nor could it.
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This was minted in 2008. Def. Exhibit 376.
The case agent did testify that, “I think that he would redeem them if he
were capable of it.” (Tr. 3/8/11, p. 64). By the term “he,” the agent was referring to
Mr. Mr. von NotHaus. By “them” he was referring to the outstanding warehouse
receipts representing claims to the seized $50 Liberty Dollars held at Sunshine
Mint. This is consistent with his testimony about evidence of redeemed warehouse
receipts. The agent added, “he can’t redeem them because we seized them.” (Tr.
3/8/11, p. 65).
The case agent testified that to his knowledge the United States Mint, Secret
Service, Federal Reserve, and U.S. Treasury will not render an opinion or approval
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of a design on a medallion or token to be stamped by the Sunshine Mint or other
private mint. (Tr. 3/8/11, p. 66). One cannot run the piece by these authorities and
has only the statutory definition of a coin found in 31 U.S.C. § 5112 for guidance.
The Liberty Dollar did not qualify as a coin under this section. The statute
did not authorize the denominations, weights, or dimensions found in the Liberty
Dollars. The Liberty Dollars did not have the statutory required “E Pluribus
Unum,” “Trust in God,” or “United States of America.” It didn’t even have the
same required combination of markings on the obverse and reverse. The case agent
improperly and inaccurately opined that the Liberty Dollars were similar to United
States pennies, nickels, dimes, quarters and half dollars. (Tr. 3/8/11, p. 73).
The case agent was personally familiar with local currency and private barter
currency, due to his prior work near the home of the Ithaca Hour. (Tr. 3/8/11, p.
66-67). He distinguished barter from a precious metal marked and created to look
like United States currency. (Tr. 3/8/11, p. 67). The agent avoided responding to
defense questions about the precious metal content of United States coins. Id. He
made reference to copper plate used in United States coins, but this incorrectly and
improperly and falsely informed the jury that copper is a precious metal. Pacific
Fast Mail, Inc., v. United States, 63 Cust.Ct. 468 (1969); Nasssau Smelting and
Refining Co. v. United States, 725 F.Supp. 544 (Ct. Int’l Tr. 1989); Mid-Fla. Coin
Exchange, Inc. v. Griffin, 529 F.Spp. 1006 (M.D. Fla. 1981); 31 U.S.C. § 5133; 31
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U.S.C. § 5312; 16 CFR §23.9; 31 CFR § 103.140(a)(4)(defines precious metal as
gold, iridium, osmium, palladium, platinum, rhodium, ruthenium or silver of
certain levels of purity).
The jury was mislead into thinking that copper and even copper clad were
precious metals and to consider the .999 fine silver composition of the Liberty
Dollar as equivalent to the base metal used in United States coin.
Given that the case agent was allowed to express an opinion about the merits
of the three counts against Mr. von NotHaus, (Tr. 3/8/11, p. 68), when asked what
the basis for that opinion was, the case agent gave an incorrect statement of the law
to the jury, “486 makes it illegal to utter and pass coins of precious metal in
currency or using them as currency whether they look similar or are of original
design.” (Tr. 3/8/11, p. 69).
This improper opinion evidence misled the jury as to the proper basis for
rendering a verdict, because the agent was repeatedly using the term “coin” in the
broadest sense as anything that was minted by private or public authority. The
agent, other government witnesses, and prosecutors were consistent in referring to
the Liberty Dollar as a coin, even though it was not minted by the United States.
The prosecutors even insisted and argued with defense witnesses who made the
proper use of the term “coin” that it is a term with no distinction. This cast the
Liberty Dollar and the proper law of the case in a false light and misled the jury.
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The case agent testified that the distinctions made between the Liberty
Dollar and United States currency in the marketing brochures and cashiers in
talking to customers and associates talking to merchants and in the publicity
through advertisements and newspaper articles were irrelevant because of the use
of denominations by Liberty Dollar. (Tr. 3/8/11, p. 71-2).
This was an incorrect statement of the law that misled the jury and called
upon them to adopt the government’s personal policy preference that there be a
single currency system in which the government has a monopoly. As to the impact
of a denomination on barter, just because a Federal Reserve Note says $20 does not
mean that it will buy what the government believes it should buy for $20. Even the
official currency is subject to market forces that determine how many Federal
Reserve Notes it takes in the trade. This FBI agent is not qualified to testify as an
economist and it shows.
The case agent improperly and inaccurately opined that it didn’t matter
whether the Liberty Dollars were not capable of penetrating the official banking
channels or that the banks, automated clearing houses, Federal Reserve, United
States Treasury, and United States Mint would identify and recognize them as not
being official United States coin. (Tr. 3/8/11, p. 73-74).
The case agent at this point says that the confusion created by Liberty Dollar
is that it is mixed with United States currency outside the banking system and
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people might not know that it is not United States currency. (Tr. 3/8/11, p. 74). The
case agent improperly argued that this was a case of deceit. Id. The agent’s own
testimony as to the markings on the Liberty Dollar and information in the
brochures and other marketing materials, and the conversations he had with
merchants contradict his improper argument to the jury. It is the government that is
trying to create confusion and mislead the jury, “And therein lies the deceit in
this.” Id.
The case agent improperly and inaccurately argued that it didn’t matter what
the intrinsic value or numismatic value of the Liberty Dollar was. (Tr. 3/8/11, p.
74-75). What mattered, according the agent, was that the Liberty Dollar was
similar to United States currency and no explanation was given to the recipient,
who might think it was United States currency. Id.
This is inconsistent with the profit motive argument and ignores the
distinguishing characteristics on the Liberty Dollar, the marketing materials and
conversations he had with merchants, and the motive for giving and receiving the
Liberty Dollar rather than Federal Reserve Notes. It confuses the jury into thinking
that the change concerns United States coin, rather than Federal Reserve Notes.
The question of similitude is really whether the Liberty Dollar looks like the
Federal Reserve Notes it is intended to replace. The government successfully
misled the jury on these important issues.
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The case agent admitted that the Liberty Dollars had a marking on them,
“BVNH,” which refers to Bernard von Mr. von NotHaus. (Tr. 3/8/11, p. 76). When
asked about the inscription around the obverse, the agent said there were a lot of
different versions and he would have to look at one of them to be able to describe
it. Id. No distinction was made by the case agent as to markings of the different
versions of the Liberty Dollar. This is quite odd in a counterfeiting case.
The case agent improperly and inaccurately opined that “when you do the
drop, people feel the heft of it and it’s easily mistaken and mixed in with U.S.
currency.” (Tr. 3/8/11, p. 77). There is no basis in fact for this testimony, no
evidence that the heft of the Liberty Dollar made it indistinguishable from United
States currency.
Quite the contrary, the heft distinguished it from the typical United States
coins used as change, and the change given by means of Liberty Dollar would be
in denominations of Federal Reserve Notes, not nickels, dimes, quarters, or half
dollars. This confusion of the United States coin with the practical and intended
use of the Liberty Dollar, as an alternative to Federal Reserve Notes, was created
by the government to mislead the jury. Therein lies the deceit.
The undercover agent testified that the Asheville regional currency officer
for Liberty Dollar provided her information in October 2005 consisting of the
phone number of the organization, the website address, and the upcoming training
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seminar referred to as Liberty Dollar Seven. (Tr. 3/8/11, p. 85). This is the same
information available to anyone with a Liberty Dollar, which has the phone
number and website address on it. It would be the same information reviewed by
the case agent about the Liberty Dollar.
The undercover signed up as an associate and received by email the monthly
newsletters, (Tr. 3/8/11, p. 85), which are also posted on the website for public
review. The undercover received a “bunch of material” which was later described
as including the 2003 Liberty Dollar book and a video of the Learning Channel
Making Money production. Id; (Tr. 3/8/11, p. 88). These things were in the public
domain for anyone to acquire and review. (Tr. 3/9/11, p. 70). The book contained
everything one could learn about Liberty Dollar, including Chapter 59, “Use the
Currency – Do the Drop.”
Equally available to the public were the four $10 one ounce Liberty Dollars
included in the package, the same Liberty Dollars offered to the case agent at Fresh
Quarter. (Tr. 3/8/11, p. 91-2). The undercover agent testified that most of the
Liberty Dollars in circulation at this time were $10 Libertys. (Tr. 3/8/11, p. 122).
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This is the $10 Liberty Dollar in use in 2003 at the time of the undercover agent's activity. Def. Exhibit 319.
The Cancun video in the associate package received by the undercover agent
was consistent with the training at Liberty Dollar University Seven, (Tr. 3/8/11, p.
95-6), which was consistent with the other publicly disseminated materials on the
website, book, Learning Channel Making Money video, and brochures at stores
like Fresh Quarter. (Tr. 3/8/11, p. 99-101, 115-6).
The undercover agent testified about paying the $250 membership fee and
that $100 of that went to the person who referred her to Liberty Dollar. Id. Much
was made of this referral fee as part of the profiteering and multilevel marketing
allegedly used to promote the Liberty Dollar, something that prejudiced the jury
and deceived them into rendering a verdict on improper bases. Id.
The agent identified the price level of the Liberty Dollar at the regional
currency officer level and the associate/merchant level, identifying the difference
in prices as profit. (Tr. 3/8/11, p. 98). No mention was made of revenue, expenses,
and net profits/losses and this was consistent with the effort by the government
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throughout the trial to suggest net profitability when there was in fact no evidence
of such profitability. (Tr. 3/8/11, p. 106-8, Tr. 3/9/11, p. 8). The undercover agent
explained that it was not her job to forensically trace down these profits. (Tr.
3/9/11, p. 77). Apparently the case agent didn’t either, since no such evidence was
presented.
In the example given by the undercover agent, she used the example of a
spot price of $4.50 for one ounce of silver, (Tr. 3/8/11, p. 108-9), even though the
case agent testified that the spot price at this time was $6.50. (Tr. 3/8/11, p. 57).
This testimony had no basis in fact as to the spot price and was misleading in its
omission of the costs of doing business covered by the markup, confusing profit
margin with markup, and the suggestion that profiteering was going on and illegal.
Therein is the lie in the government’s case.
The undercover agent read from the marketing materials to establish what
would be culpable if private currency is illegal, which continued the misperception
given by the case agent in his testimony, and misled the jury to an improper basis
for their verdict. (Tr. 3/8/11, p. 100-2). Phrases like, “join the free money
movement … and start getting your money at a discount,” “stop using their money.
Start using the Liberty Dollar,” and, “it functions dollar for dollar, i.e., in parallel,
with the current Federal Reserve Notes,” were emphasized for this illegitimate
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purpose Id. The same was true of the “marketing pitch” of offering the merchant a
choice of the Liberty Dollar or a Federal Reserve Note. (Tr. 3/8/11, p. 102).
The undercover agent described the Drop, just as it is described in the 2003
Book, Chapter 59, p. 404. By dropping the one ounce of fine silver into the hand,
rather than handing it to the merchant or letting the merchant pick it up, the
merchant can tell by its weight that it feels like one ounce of fine silver. (Tr.
3/8/11, p. 102). The same was true for the drop done by the merchant when
offering a Liberty Dollar as change. (Tr. 3/8/11, p. 117).
The undercover agent then describes the admonition to not inundate the
merchant with educational information on the “Federal Reserve and their
inflationary, fiat currency.” (Tr. 3/8/11, p. 102-3). And here too the agent is merely
repeating that which is not only in the training materials and associate package but
in the 2003 Book and website as well. These materials explain that the policy
reasons for having a private barter value based currency were unwanted and not
needed to understand what the simple drop of the one ounce of fine silver will say
to the merchant at the time of the initial introduction of the Liberty Dollar.
The government successfully and unfairly painted this as a deception, even
though the Liberty Dollar not only speaks by its weight and beauty, but also words
including the phone number and website address on the Liberty Dollar, and the
brochure offered to the merchant, and the associate’s directing the merchant to
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more information on the website. And the object was to create an ongoing
relationship with merchants and customers which could not happen if there was a
deception. The government exaggerates the introduction of the Liberty Dollar to a
potential Liberty Dollar merchant to swallow all that happens as a result of that
introduction – the development of a network of Liberty Dollar to people. Neither
the case agent nor undercover agent testified as to their observing any person
actually deceived by the Drop and the literature and training show that no
deception was intended.
The literature itself points out two important facts. First, the associate is
encouraged to leave the brochure and business card with the merchant in case they
have any questions. 2003 Book, p. 405. Second, the purveyors of Federal Reserve
Notes thrive on the ignorance of people about money. Id. “In contrast, the Liberty
Dollar is a door opener that solicits a response and in so doing, helps identify “the
choir” – those who already know about the fraudulent Federal Reserve and want to
finally do something about it.” Id.
In explaining the meaning of the term FRN, the undercover agent cast it as
“real U.S. currency,” which would be fine if this were a marketing competition
where Pepsi and Coke take turns claiming to be the real thing. In a judicial
proceeding, this terminology took on significance in large part due to the case
agent’s prejudicial testimony suggesting that there can be only one currency. The
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undercover agent further misled the jury to an improper basis for their verdict
throughout her testimony.
The 2003 Book and materials received by the undercover agent instructed
the agent and others to “never misrepresent the currency as US currency or
legal tender.” 2003 Book, p. 408 (bold in the original). The undercover agent did
not testify that a contrary instruction or practice or incident occurred during her
undercover activities with Liberty Dollar.
The undercover agent, however, did improperly opine and mislead the jury
into thinking that the “Liberty Dollar is not legal.” (Tr. 3/9/11, p. 88). The
reasoning was that legal tender is that which can be forced upon people. Id. “So if
the Liberty Dollar is not legal, it couldn’t be forced on someone.” Id. This was
nonsense that lead the jury to an improper basis for their verdict.
The undercover agent’s explanation of how the $10 Liberty Dollars was to
be offered to the merchant showed that it was not intended as change for a United
States coin or used as United States coin. (Tr. 3/8/11, p. 122-3). A $10 Liberty
Dollar was offered if the goods were between $5 and $10 in value. Id. The barter
was this margin of $5. There was no United States coin of such a value to compete
with this use of the Liberty Dollar or to counterfeit any United States coin.
The undercover agent argued that the intended function of the Liberty Dollar
in the hands of the public was as a medium of exchange and not a store of value.
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(Tr. 3/9/11, p. 16-17). “It was a currency.” Id. This misled the jury into thinking
that it is a crime to have a private currency. The same was true about the Burger
King story told by Mr. von NotHaus, where a Liberty Dollar was used there and
while he was present the cashier provided the Liberty Dollar to a customer as
change. The prosecutor argued that Mr. von NotHaus was training people “how to
inject this currency into the marketplace.” (Tr. 3/9/11, p. 22). This improperly and
deceitfully suggested that injecting currency into the marketplace was a proper
form of counterfeiting for which the jury could convict.
The undercover agent did testify that Mr. von NotHaus wanted the Liberty
Dollar “to compete with the Federal Reserve Note,” but the prosecutor quickly had
that notion substituted by, “Legitimate U.S. currency.” (Tr. 3/9/11, p. 18-19). This
shows the prosecutor’s guilty mind, wanting to hide the truth and substitute their
propaganda. The truth being that it is legal for private currency to compete with
United States currency and that the Liberty Dollar competed with the Federal
Reserve Note, and not with the United States coin. Both currency systems relied
upon United States coins to make small change.
The undercover agent did admit that some Liberty Dollars were recognized
as having numismatic value, and gave the example of Mr. von NotHaus having a
striking device he often used to put a mark on the Liberty Dollar, “which would
some day make it more valuable.” (Tr. 3/9/11, p. 17).
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The undercover agent also admitted that besides the Drop, which
emphasized the qualities of the Liberty Dollar and compared it with a $10 Federal
Reserve Note, the Liberty Dollar was also promoted as a way of locally owned
stores keeping the currency local by using the Liberty Dollar and providing local
control of the supply of money. (Tr. 3/9/11, p. 21). Note that it stays local because
it is not bankable.
The undercover agent testified that after the Liberty Dollar was revalued to
the $20 base, she purchased eight of these $20 Liberty Dollars in December 2005
and in 2006. (Tr. 3/9/11, p. 32-35, 53-56).
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The undercover agent was allowed to chime in on the United States Mint
press release in September 2006, further injecting this improper, irrelevant,
inaccurate, and prejudicial opinion from the United States Mint into the trial and
the jury’s verdict. (Tr. 3/9/11, p. 37-38). The response by Innes shows that he
believed that they were doing nothing wrong and that the United States Mint was
mistaken. Id. He did not know that the FBI had asked the United States Mint to
issue this press release.
Mr. von NotHaus had the same reaction to it, saying “nobody was buying
their story.” (Tr. 3/9/11, p. 39-40). And no wonder since it was by an organization
whose profits were being eaten by the competition and could do not more than
make vague, false claims about the Liberty Dollar when for years spokespersons
for the United States Treasury, Secret Service, and Federal Reserve had had no
objection to it, issued no cease or desist order or civil enforcement action,
consistent with the opinion of Mr. von NotHaus’ attorneys and the research by
RCO Rostcheck. They had every right to proceed with business as usual and for
the government to prove its case, without interjection of a self-serving opinion in
the form of this press release.
The field training received by the undercover agent in Skokie, Illinois, as
part of Liberty Dollar University Eleven produced similar results to the case
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agent’s personal experience during his initial investigation, no evidence of
counterfeiting. (Tr. 46-48). The point the government wanted to make is that Mr.
von NotHaus was attempting to promote Liberty Dollars as a competing private
voluntary barter currency. This resulted in an improper basis for the jury’s verdict.
The undercover agent admitted that the Liberty Dollar materials “were
dissatisfied with the current money system,” and admitted that, “They were
exercising their First Amendment rights.” (Tr. 3/9/11, p. 86).
The undercover agent admitted that, according to the training materials,
website, brochures, etc., it is improper to refer to the Liberty Dollar as a “coin.”
(Tr. 3/9/11, p. 14). She later qualified this to say that Mr. von NotHaus and the
others would accidently let the word slip out, but that Mr. von NotHaus insisted
that the Liberty Dollar not be referred to as “coin,” “legal tender,” or “current
money.” (Tr. 3/9/11, 103-104). Here is evidence of an effort to be clear in
communicating the difference between the Liberty Dollar and United State
currency. A clear expression of intent not to confuse the two forms of currency.
The undercover agent twisted this around and improperly argued that Mr.
von NotHaus and all the others involved with Liberty Dollar were deluding
themselves by maintaining this distinction. (Tr. 3/9/11, p. 104, 106). This could
make sense only if private voluntary barter currency is illegal. Again, the
authorities were calling upon the jury to render a verdict on an improper basis. This
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fit in with the consistent use of the term “coin” by the prosecutors and agents for
both Liberty Dollars, which are not coins, and United States coins.
This was willful manipulation of words to confuse the jury. Even if Liberty
Dollars were counterfeit, it would be improper to refer to them as coin, since only
the real thing is properly called coin. This was the government playing games with
words, liberty, and the jury.
The United States Mint attorney testified that “circulating coins are
commonly pennies, nickels, dimes, quarters, and dollar coins.” (Tr. 3/9/11, p. 130).
Note that he did not say anything about $5, $10, $20, or $50 coins. He also
admitted that the United States Mint sells these circulating coins “to the Federal
Reserve at their face value.” Defense counsel was not permitted in its questioning
of the undercover agent to inquire about the cost of these coins. (Tr. 3/9/11, p.
124).
The government attorney misrepresented the term “legal tender” when he
testified that “the sole purpose of stamping denominations on the silver, gold, and
platinum coins is so that they have a nominal denomination so that they can be
considered legal tender.” (Tr. 3/9/11, p. 131). Nowhere in 31 U.S.C. § 5103, which
defines legal tender, does it make express or implicit reference to the denomination
of United States currency. This was a deceptive manipulation of the jury into
thinking that a denomination connotes United States currency and this led to an
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improper basis for its verdict. He did not inform the jury that there was no
counterpart United States silver coin denomination to the Liberty Dollar
denominations.
The government attorney admitted that § 5103 defines legal tender and that a
merchant or whoever is offered the United States currency, is not required by law
to accept legal tender. (Tr. 3/9/11, p. 148). The Constitution does not give the
government a monopoly on currency, the statutes clearly define what United States
currency is and do not require its acceptance in trade, but somehow private
voluntary barter currency is illegal because it functions as United States currency
does. This is the scheme of things sold to the jury.
The government attorney testified that the design of circulating coins
changes every five years, including ten new designs per year. (Tr. 3/9/11, p. 132).
This costly effort is inconsistent with the claim by the government that a hapless
public would not notice that what they had in the hand was a Liberty Dollar. Why
change designs if the public isn’t going to notice? Why assume that the public is
not going to discern a Liberty Dollar?
The government attorney was allowed to testify about the 50-State Quarter
Program, Presidential $1 Coin Program, and the Native American $1 Coin
Program, and the America the Beautiful Quarters Program, even though none of
these were shown to be or even claimed to be similar to the Liberty Dollars. (Tr.
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133-134). The government had been allowed to elicit testimony from the case
agent falsely claiming that State Monetary Initiative Liberty Dollars came out
about the same time as the government’s the 50-State Quarter Program. Tr. 3/8/11,
p. 42-43). The defense was not allowed to offer an alternative explanation for the
Liberty Dollar SMI Program, namely a movement to have states mint their own
currency.
The government attorney admitted that he had known of NORFED and
Liberty Dollar before the Justice Department approached him about issuing a press
release. (Tr. 3/9/11, p. 134-135). In fact, since 1998, journalists and Liberty Dollar
people and others had asked spokespersons for the United States Treasury, Secret
Service, and Federal Reserve about it and received no suggestion that the Liberty
Dollar violated 18 USC §§ 485, 486. The Bureau of Engraving and Printing
provided a number of records corroborating these newspaper reports. Exhibit C.
This did not deter the United States Mint’s about face at the request of the
Department of Justice. No change in law, just change in policy.
The government attorney admitted that for suspected criminal violations of
the coinage laws, the United States Mint is required to report it to the Inspector
General of the United States Treasury, who is responsible for investigating it with
the assistance of the Secret Service or the Department of Justice. (Tr. 3/9/11, p.
149). No such procedure was followed in the instant case and no assurances of due
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process were afforded to anyone affected by the press release or subsequent role
that press release played in the Department of Justice’s pre-existing misadventure
with Liberty Dollar. This lack of due process spilled over into the trial through
repeated assurances by the authorities, which impermissibly invaded the province
of the jury and called upon the jury to render a verdict on improper bases.
The government attorney admitted that had the Liberty Dollar been
marketed by suggesting in any way that it was minted by or associated with the
United State Mint, the United States Mint would first issue a cease and desist order
and then proceed with civil process leading to a fine or civil penalty. (Tr. 3/9/11, p.
136, 144). Note that no such misrepresentations were made by Liberty Dollar and
no cease and desist order or civil process issued against Liberty Dollar. The 50State Quarters Program, was a registered trademark the United States Mint owns,
and would allow enforcement against any infringement on this trademark. (Tr.
3/9/11, p. 145). No such action was taken against the State Monetary Initiative
Liberty Dollar Program because it was clearly competing with Federal Reserve
Notes rather than counterfeiting the United States quarters and doing it in
conjunction with the movement for State minting of their own currency.
The government attorney was allowed to further advocate the merits of his
agency’s press release and letters to regional currency officers informing them of
the opinion by the Department of Justice, in clear violation of Rule 808(8) of the
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Federal Rules of Evidence. To allow the jury to repeatedly hear about this opinion
and its development and implementation could only serve to invade the province of
the jury as to whether there was a violation of the law and to compel an improper
basis for the verdict.
The government attorney testified that the markings on United States coins
are not sufficiently unique to the United States coins to be proprietary and are in
fact in the public domain. (Tr. 3/9/11, p. 146). This undermines any reliance by the
public upon the general markings of a medal such as a torch or liberty head or
other allegorical images. Adding to these markings the name and phone number of
someone other than the United States Mint or United States of America as the
issuer would certainly impose upon the public sufficient information to believe that
the medal is not issued by the United States Mint.
The government attorney confirmed what the case agent said about the
United States Mint not giving an advisory opinion, even though they do get
requests for them. (Tr. 3/9/11, p. 146). Note that their press release does give an
opinion by the Department of Justice, but the context of the press release was to
intimidate Liberty Dollar after they had been in business in the open and with the
knowledge of the authorities for eight years and had reached a following of a
quarter of a million holders of Liberty Dollars worth today about $50,000,000.
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The government attorney admitted that in effect they give advisory opinions
“on the back end.” (Tr. 3/9/11, p. 146-147). He also admitted that, “once that
member of the public consults his or her attorney, there’s no further thing they can
do except to wait for a mint warning or Justice Department action to come down.”
(Tr. 3/9/11, p. 147).
The alleged victim testified that she accepted $10 Liberty Dollars at her
business on several occasions in 2003 and asked if the Liberty Dollar was bankable
and was told by Innes that it was. (Tr. 3/9/11, p. 153-160). This is inconsistent with
the testimony of the case agent and undercover agent who testified about their
observations, the promotional materials given to merchants to recruit them which
said the Liberty Dollar is not bankable, the undercover agent’s instructions from
the associate package and Liberty Dollar University training, and her observations
and field training.
This Court allowed it in as an admission of a co-conspirator, but the only
conspiracy established by the evidence was to distribute Liberty Dollars with full
disclosure that it is not bankable and not United States currency. Yet, over the
objection of the defense, the alleged victim was allowed to offer this testimony of
an out-of-court statement attributed to Innes allegedly made over seven years ago,
lacking any indicia of reliability due to the inability to confront the declarant and
inconsistencies with the evidence of how the Liberty Dollar was distributed and
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evidence of the pattern of dealings by the alleged victim with Liberty Dollar, and
the lapse of time, in violation of Rule 801 of the Federal Rules of Evidence and
Crawford v. Washington, 541 U.S. 36 (2004).
The true value of the Liberty Dollar, distinguishable from United States
currency, is seen in the fact that the first one was placed in the son’s piggy bank,
the second one was placed in the grandson’s piggy bank, the third one was saved
by an employee, “And this happened over and over. So it never really got put in
the deposit.” (Tr. 3/9/11, p. 153). Note that this was not treated like United States
currency, which did go to the bank to be circulated in the Federal Reserve System.
The Liberty Dollar received special treatment, as it should, because of its
substantial differences from United States currency. It was treated not as currency
but as “a collector’s coin for my son’s collection that I was collecting for him.”
(Tr. 3/9/11, p. 161).
Trying to deposit it seems odd under the circumstances given the nature of
the marketing and markings of the Liberty Dollar and the treatment it received
from the alleged victim. Claiming at trial that “it was no good” is odd given that it
is .999 fine silver worth 350 percent of its face value. (Tr. 3/9/11, p. 157).
Claiming there was nothing she could do when the bank refused to take it is
odd, given that she did not contact Innes or call the 800 number on the Liberty
Dollar or complain to the authorities; instead, she treated it with the same
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appreciation of its value as she afforded the other Liberty Dollars by putting it in
her son’s piggy bank. (Tr. 3/9/11, p. 154).
It wasn’t until the authorities broadcast the frivolous charges in this case
against Innes and falsely informed the alleged victim that the Liberty Dollar was
no good in 2009 did she indicate any problems with the Liberty Dollar, over six
years after receipt of it. (Tr. 3/9/11, p. 157, 159-160).
The government’s expert on metal could only testify that the Liberty Dollars
were made of high quality solid silver in the quantity indicated on the Liberty
Dollars. (Tr. 3/9/11, p. 168, 171). He testified that it was .9995, which is greater
quality than the .999 advertised on the Liberty Dollar. (Tr. 3/9/11, p. 171).
The second undercover agent’s description of what Innes told her about
being a merchant who accepts the Liberty Dollar is somewhat inconsistent and
misleading. (Tr. 3/9/11, p. 177). According to the first undercover and the
literature, the merchant and associate operate at the same level in terms of pricing
the Liberty Dollar, not at different levels. The second undercover agent was candid
about the markup being such that she “would be able to make a little bit of money
off of it.” (Tr. 3/9/11, p. 177). She also testified that she could earn additional
money ($100) by recruiting others (who would buy at a discount rather than
whatever rate the merchant would charge in a bartered exchange). Id.
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There was no testimony of counterfeiting, only the distribution of the
Liberty Dollar, including the use of the Liberty Dollar to make change and pay
employees. (Tr. 3/9/11, p. 178). This tied into the theme already well developed by
the government that it was the nature of the Liberty Dollar as a private voluntary
barter currency that was the crime. The second undercover agent did receive $10
and $20 Liberty Dollars at this time in March 28, 2007. (Tr. 3/9/11, p. 180). These
have already been displayed in this brief.
The second undercover agent testified that Innes considered the United
States Mint press release “as libel and slander,” they had it “all wrong,” “it was not
illegal,” and that the “government was trying to scare people.” (Tr. 3/9/11, p. 179).
That sounds like an accurate assessment by a man who honestly (and with
substantial justification) believed that he was complying with the law.
CONCLUSION
For the foregoing reasons, this Court should enter judgment of acquittal
pursuant to Rule 29, because the evidence is insufficient to support the verdict,
particularly as to the element that the Liberty Dollars in question were counterfeits
of United States coin and the criminal intent element of the crimes charged. In the
alternative, this Court should, pursuant to Rule 33, arrest judgment because the
indictment does not charge an offense with regard to these elements and the legal
standard stated in the indictment is not supported by the facts or law. In the
46 197
Filed 03/31/11 Page 46 of 50
alternative this Court should, pursuant to Rule 34, in the interest of justice vacate
the verdict and order a new trial free from the errors above-specified. Mr. von
NotHaus is willing to have the new trial by the bench with defense witnesses
appearing voluntarily at their own expense.
The prosecutors successfully painted Mr. von NotHaus in a false light and
now the U.S. Attorney responsible for the prosecution is painting the case in a false
light saying that it establishes that private voluntary barter currency is illegal. The
press release goes further than the redacted paragraph in the indictment, adding
two more phrases about how important it is for the government to have a
monopoly on money.
Nobel laureate F.A. Hayek thought that private voluntary barter currency
was better for the community, a number of other economists agree. Even Dr. Bruce
Champ of the Federal Reserve Bank agrees. The U.S. Attorney considers them
domestic terrorists. Of course she has no credentials in economics. Her expertise is
taking away the individual’s civil rights through the criminal justice system.
By outlawing private voluntary barter currency and the use of any medium
of exchange other than Federal Reserve Notes, the government is taking us back to
the days of FDR and the Great Contraction, chronicled by Milton Friedman as a
total economic disaster tied directly to the mismanagement of money, first by the
Federal Reserve and then by the government proper.
47 197
Filed 03/31/11 Page 47 of 50
The worst part of this is that it is being done the way that a socialist society
would do it, by force, rather than voluntary choice. The government is using the
criminal justice system to impose their policy choices on everyone, like the white
supremacist used the criminal justice system to maintain control of African
Americans. The government is prosecuting those who disagree with its policy
against private voluntary barter currency. Say good-bye to liberalism.
This the 31st day of March, 2011.
/s Aaron E. Michel
Aaron E. Michel, Attorney at Law
Counsel for Mr. von Mr. von NotHaus
Phone: 704-451-8351
Email: [email protected]
3736 Surry Ridge Court
Charlotte, NC 28210
48 197
Filed 03/31/11 Page 48 of 50
CERTIFICATE OF SERVICE
The undersigned hereby certifies that a copy of the foregoing was served this 31st day of March,
2011, by means of the Electronic Filing System for the Western District of North Carolina, upon
the following parties:
For the Government:
Jill Westmoreland Rose
Assistant U.S. Attorney
100 Otis Street, Room 233
Asheville, NC 28801
828-271-4661
Fax: 828-271-4670
Craig D. Randall
227 W. Trade St., Suite 1700
Charlotte, NC 28202
704-344-6222
Fax: 704-344-6629
Thomas R Ascik
Asheville, NC 28801
828-259-0644
Benjamin Bain-Creed
Asheville, NC 28801
828-271-4661
Fax: 828-271-4670
49 197
Filed 03/31/11 Page 49 of 50
For William Kevin Innes:
Claire J. Rauscher
Federal Defenders of Western North Carolina
129 W. Trade Street, Suite 300
Charlotte, NC 28202
704-374-0720
Fax: 704-374-0722
Erin Kimberly Taylor
Federal Defenders of Western North Carolina
129 W. Trade Street, Suite 300
Charlotte, NC 28202
704-374-0720
Fax: 704-374-0722
For Sarah Jane Bledsoe:
Joe Von Kallist
6743-A Fairview Road
Charlotte, NC 28210
704-366-9008
Fax: 704-365-2109
For Rachelle L. Moseley:
Matthew G. Pruden
301 E. Park Avenue
Charlotte, NC 28203
704-338-1220
Fax: 704-338-1312
This the 31st day of March, 2011.
/s Aaron E. Michel
Aaron E. Michel, Attorney at Law
50 197
Filed 03/31/11 Page 50 of 50
Case 5:09-cr-00027-RLV -DCK Document 197-1
5:09-cr-00027-RLV -DCK Document 197-2
Filed 03/31/11 Page
Filed 03/31/11 Page
Filed 03/31/11 Page
MEMORANDUM FOR DAWN R. HALEY, CHIEF
OFFICE OF EXTERNAL RELATIONS
THRU:
Claudia W. Dickens, Acting Manager
External Affairs Division
FROM:
Lydia Washington
SUBJECT:
Weekly Report: January 27 – 31, 2003
EXTERNAL RELATIONS
UPCOMING MEDIA EVENTS
Nothing to report.
MEDIA EVENTS
A reporter from Moscow Times interviewed you concerning NexGen currency.
A reporter from the Newton Citizen (Georgia) called to ask for pictures of the
NexGen $20. He was advised that there has been no release of those pictures
yet.
A reporter with Bloomberg News called to ask for the amount of currency in
circulation. He was given the figures for each denomination as of November 29,
2002 (the latest report we have from Financial Management Service).
Another reporter from Bloomberg News called to ask when currency notes with
Secretary of Treasury John Snow’s signature could expect to be in circulation.
He was advised that it would be a minimum of three to four months.
A researcher with a Fort Worth radio station called with questions about the
legality of the Liberty Dollar. He was advised that these dollars are privately
printed and are not obligations of the United States.
A researcher from the television series “CSI-Miami” called with questions about
counterfeiting. He was referred to the United States Secret Service.
CONGRESSIONALS
A representative from Congressman Bill Schuster’s (R-PA) Office called to ask
what BEP Form 02-04 was printed for. After thorough research he was advised
that we could find no record of BEP Form 02-04.
INTERNAL COMMUNICATIONS
Staff prepared and distributed two Internal Communications memorandums
during this reporting period. The first memorandum contained information
regarding an A-76 update, clarification of the administrative leave granted on
Christmas Eve Day, long term care insurance applications, the Public
Transportation Incentive program and free diabetes screening. The second
memorandum covered topics involving the confirmation of Treasury’s new
Secretary, the Director’s Town Hall meeting, evacuation instructions, extended
customer services hours in the Office of Human Resources, disposal of excess
property and information regarding BEP’s new Uniform contract and subsequent
employee measurements.
BEP COMMUNICATOR
Staff is preparing articles for the February issue of the Communicator.
INTERNET/INTRANET
Staff responded to 123 website inquiries.
AUDIO VISUAL
Staff completed the filming and editing of a currency manufacturing video for the
Office of Technology. In the future this video will be available for use by the
entire BEP.
BNN
No report.
PUBLIC SERVICE DIVISION
TOUR
Week of January 27 – 31:
8:15 VIP Tour:
8:45 VIP Tour:
Public Tour Count:
31
19
2,637
Staff scheduled and conducted a floor tour for a Nigerian Delegation of nine who
were in town visiting the International Law Institute.
On Friday, January 31, 2002, 15 busloads of safety patrol students arrived
without reservations; however, the Tour staff was able to accommodate them
without any major problems. The tour total for January 31, 2002 was 1,278.
FORT WORTH TOUR AND VISITOR CENTER
No report.
NEW CURRENCY/PUBLIC EDUCATION CAMPAIGN
No report.
MISCELLANEOUS (DEA, PSD AND MD)
Staff responded to approximately 550 telephone inquiries, 80 general
correspondence inquiries, 25 e-mail inquiries and mailed 30 general information
packets.
Staff continues to work on the Town Hall meeting scheduled for February 12,
2003.
HISTORICAL RESOURCE CENTER
Staff responded to three external and three internal requests for assistance
during this reporting period.
Staff acquired two new drawers of articles from the specimen vault.
MARKETING DIVISION
PUBLIC SALES
Weekly sales totaled $176,492, an increase of 14% compared to FY 2002
($155,156). Year to date sales totaled $4,108,772 an increase of 73% compared
to FY 2002 ($2,380,897).
Staff resolved 17 customer inquiries.
Staff responded to 84 Internet inquiries.
EXHIBITS AND SHOWS
No report.
-end of report-
THRU:
Division of External Affairs
FROM:
Lydia Washington
SUBJECT:
Weekly Report: February 3 – 7, 2003
EXTERNAL RELATIONS
The London Bureau of the Economist has asked to interview BEP Director
Thomas Ferguson concerning NexGen currency. Approval of this request has
not yet been given.
MEDIA EVENTS
A reporter with the Fort Worth (TX) Star Telegram telephoned to inquire about
the release of the Department of the Treasury's budget and what impact it would
have on the Bureau's Fort Worth facility. She was advised that the Bureau’s
operations are financed by means of a revolving fund. Further, she was told that
the fund is reimbursed through product sales for direct and indirect costs of
operations, including administrative expenses.
A writer from City Paper (Washington, DC) called with questions about when and
why BEP designed currency notes for the African nation of Eritrea He was
advised that former BEP Director Peter Daly approved the request from Eritrea
and authorized former BEP Designer Clarence Holbert to design the currency for
that nation. The reporter was further advised that both gentlemen are retired.
A researcher from CBS News (Washington, DC Bureau) called to ask about the
legality of Liberty Dollars. She was advised that the notes are privately printed.
Further, she was told that businesses could accept them at their own discretion.
A request from Government Enterprise to publish an article based on a survey
completed by an Office of Information Systems’ manager was denied as the
article gave the appearance of endorsing a software product.
A reporter from the Evening Leader (St. Mary’s, OH) called with general
questions about U.S. currency.
A researcher from the Public Affairs Office of Secretary of Defense Rumsfeld
called to ask if the Department of Defense (DOD) prepared ink for use on U.S.
paper currency. She was advised that the BEP does not receive security ink
from DOD.
CONGRESSIONALS
On February 4, 2003, the Office of Congressman Jeff Miller (R-FL) called for tour
brochures. The brochures identified were no longer issued by the BEP. The tour
office faxed an information sheet to the Congressman’s office per their
agreement.
Nothing to report.
BEP COMMUNICATOR
Staff is now collecting articles for the February/March issue of the Communicator.
INTERNET/INTRANET
AUDIO VISUAL
No report.
BNN
No report.
TOUR
Week of February 3 – 7:
8:15 VIP Tour:
8:45 VIP Tour:
Public Tour Count:
45
7
2,009
On Wednesday, February 5, 2003, 250 guests from the Banknote 2003
Conference took the gallery tour. In the Conferencing Arena, David T. Curtis, a
Production Specialist from the Office of Engraving, gave the guests a special
presentation regarding NexGen’s currency inspection system. The Banknote
conference guests were also shown engraving presentations and mutilated
currency exhibits.
FORT WORTH TOUR AND VISITOR CENTER
Staff met with the Department of Agriculture to discuss confirmed and pending
architectural/engineering changes.
Staff decided that Design Progress meetings will take place every Tuesday,
beginning February 11, 2003, at Quatrefoil Associates in Laurel, Maryland, until
the 100% design development presentation is made on April 29, 2003.
The vending, transit, and financial industry update letters are scheduled to be
released this month.
Website development for the redesigned currency campaign is currently
underway.
Staff reviewed the creative components for the redesigned currency’s website.
Staff coordinated production and development of B-roll for use in the public
education campaign.
Staff is working with the State Department to provide information to American
embassies around the world about redesigned currency.
The unveiling of the NexGen $20 note is scheduled for Thursday, March 27,
2003, at 10:00 a.m. in BEP’s Conferencing Arena.
correspondence inquiries, 26 e-mail inquiries and mailed 34 general information
packets.
Staff is finalizing details for the Town Hall meeting which is scheduled for
February 12, 2003.
Staff responded to two internal research requests.
Staff began cataloging new items received from the specimen vault.
MARKETING DIVISION
PUBLIC SALES
Weekly sales totaled $61,794, a decrease of 79% compared to FY 2002
($289,746). Year to date sales totaled $4,170,566 an increase of 56% compared
to FY 2002 ($2,670,643).
EXHIBITS AND SHOWS
No report.
-end of report-
THRU:
Division of External Affairs
FROM:
Lydia Washington
SUBJECT:
Weekly Report: March 24 – 28, 2003
EXTERNAL RELATIONS
Nothing to report.
MEDIA EVENTS
A reporter from the University Journal (Utah) called to ask what color(s) would be
on the $20 NexGen currency note.
A reporter from The Washington (DC) Times called to ask about the validity of
Liberty Dollars. He was advised that the U.S. government does not issue these
notes but that if merchants were willing to accept them in payment of
goods/services they were not illegal to print.
A researcher from CNN Money called to ask for a copy of the June 20, 2002
Press Release about NexGen Currency. A copy was e-mailed to him.
A reporter from KRDO-TV (ABC Affiliate in Denver, CO) called to ask if there was
someone in the Denver area they could interview about the features in NexGen
currency. She was advised that the notes have not been introduced yet.
A reporter from the Daily News (Greenville, MI) called to ask about the color(s) of
the NexGen $20 note. Their paper was conducting a poll and they wanted to
compare results of their poll against what the new design would look like. She
was advised that the NexGen note has not yet been introduced.
A researcher from Government Computer News was following up from an earlier
request for information about any software connected to the NexGen currency
notes. She was advised that because the NexGen $20 had not yet been
introduced no such interview could be entertained or granted.
A reporter from the television program, “Business for Breakfast,” called to ask
when the $20 NexGen currency note would be issued. He was advised that they
would be put into circulation later this year.
A reporter from the Star Tribune (Minneapolis, MN) called to ask when and why
the Treasury discontinued the higher denomination currency notes. She was told
that they were last printed in 1945 and in 1969 the Federal Reserve announced
that the notes would be withdrawn from circulation as they came in through
regular banking channels. The demand for the higher denomination notes had
greatly decreased and that was the main reason they were discontinued.
A reporter from KTVU in San Francisco called to ask if the Unveiling Ceremony
for the $20 NexGen currency note had been cancelled. She was advised that it
had been postponed.
A writer with PBS National Series called to ask how to order presidential
vignettes. She was given the telephone number for Mail Order Sales.
A reporter from the ABC affiliate in Orlando, Florida called to ask the new date for
the Unveiling Ceremony for the $20 NexGen currency note. He was advised that
a new date for the unveiling has not been established.
A researcher from TV 13 in LeHigh, PA called to ask about the portraits
appearing on coins; specifically, he wanted to know if Dr. Martin Luther King, Jr.
would appear on the $1 coin. He was referred to the U.S. Mint.
Information about the link on BEP’s website for NexGen currency was passed on
to Coin World, Bank Note Reporter and Coin Age Magazine.
CONGRESSIONALS
A staff person from Sen. Olympia Snow’s (R-ME) office called to ask for
information about a coupon that had been detached from a bond. She was
referred to the Bureau of the Public Debt.
Staff is researching “What’s On Your Mind” newsletter inquiries.
BEP COMMUNICATOR
Staff has completed the layout of the April edition of the newsletter.
Filed 03/31/11 Page 10 of 17
INTERNET/INTRANET
Staff answered 51 website inquiries.
AUDIO VISUAL
No report.
BNN
No report.
TOUR
Week of March 24 – 28:
8:15 VIP Tour:
8:45 VIP Tour:
Public Tour Count:
80
123
0
FORT WORTH TOUR AND VISITORS’ CENTER
Quatrefoil Associates received the BEP’s corrections to the 50% Script Draft.
The postcards, Press Kit Folders, and letterhead for the Public Education
Information Outreach campaign have been printed by the Government Printing
Office (GPO) and delivered to Direct Impact for distribution.
Staff discussed exhibit development with Burson-Marsteller on March 28, 2003.
This exhibit will be used to display materials used by BEP spokes personnel.
Staff is continuing NexGen currency launch event plans and program logistics
(program timeline, invitation e-mail reminders, display props, and role
designation).
Filed 03/31/11 Page 11 of 17
correspondence inquiries,35 e-mail inquiries and mailed 40 general information
packets.
Staff responded to 2 internal research requests.
MARKETING DIVISION
PUBLIC SALES
($70,048). Year to date sales totaled $4,554,567, an increase of 16% compared
to FY 2002 ($3,913,163).
EXHIBITS AND SHOWS
No report.
-end of report-
Filed 03/31/11 Page 12 of 17
THRU:
Claudia W. Dickens, Manager
External Affairs Division
FROM:
Lydia Washington
SUBJECT:
Weekly Report: March 8 – 12, 2004
EXTERNAL RELATIONS
Nothing to report.
MEDIA EVENTS
March 9, 2004: Ariel Hart, a reporter with the New York Times, called to ask if
the Treasury Department had printed a one-million dollar currency note. She
mentioned that a lady had tried to use such a note recently at a store. The
reporter was told that the Treasury/BEP had not printed such a note. The high
denomination notes were identified to her and she was informed that although
they were issued until 1969, they were last printed in 1945.
March 10, 2004: Burson-Marsteller interviewed/filmed Director Ferguson to
prepare B-Roll/Video News Release footage which will be used for the upcoming
unveiling of the redesigned $50 note.
A reporter with the Des Moines Register called with some follow-up questions
concerning the “Liberty Dollar.” As in the past it was explained that if a private
concern wants to print currency that they do not present as legal tender and if
merchants want to accept it in payment of goods and services it is not considered
illegal. Reference was made to similar currencies such as “Disney Dollars” and
“Dollar Coupons” as examples.
A reporter from the Observer News in Washington, Pennsylvania wanted to know
if the portrait of George Washington had appeared on any denomination other
than the $1 note. She was told that Washington’s portrait had appeared on large
size $2, $20, $500 and $1,000 notes and some fractional currency.
Filed 03/31/11 Page 13 of 17
Channel 5 (WTTG News) requested to interview a BEP representative about a
book written that is entitled, “The Secret Symbols of the Dollar Bill.” The request
was denied.
A researcher with Radio KVC in San Luis Obispo, California called to ask if the
Bureau had ever printed a $1 million bill. He was told that the Bureau had never
printed that denomination of currency.
CONGRESSIONALS
Nothing to report.
A “What’s On Your Mind?” newsletter was issued and prepared during this
reporting period.
An Internal Communications Memo was issued containing topics regarding the
dates for the Town Hall Meetings and the safety of the Bureau’s drinking water.
A second Internal Communications Memo was issued, reporting the status of the
Goal Sharing program, bone density screenings at the Washington facility, and
that PR Newswire statement naming the BEP as the Global Campaign Winner of
the Year for the Series 2004 $20 note public education program.
BEP COMMUNICATOR
Staff is collecting articles for the April edition of the newsletter.
INTERNET/INTRANET
AUDIO/VISUAL
No report.
Filed 03/31/11 Page 14 of 17
TOUR
Week of March 8 – 12:
8:15 VIP Tour:
8:45 VIP Tour:
Total Public Day Tour Count:
Total Tour Count:
156
152
3,685
3,993
FORT WORTH TOUR AND VISITORS’ CENTER
Staff held a meeting with BEP's graphic design contractor, Mr. Del Moran of ITS
Services Incorporated, and U.S Department of Agriculture’s staff to go over the
layout of text and graphic elements for the Children's Activity Packet.
The Director approved the tour film and made changes to the Engraving Worker
Video at Muheim Motion Pictures.
Staff continues to review and approve exhibit panels.
Staff worked with the stakeholder team on the text for the postcards and seed
mailing letters for transit, vending, and gaming industries.
To date, 20,251 domestic and 757 international fulfillment orders have been
placed for educational materials.
Staff has put a hold on all shipments of Series 2004 $20 educational materials for
two weeks.
Staff changed the number of pieces that could be ordered for the education kit to
three per company.
Staff held a weekly media and events meeting on Wednesday, March 10 th to
determine unveiling event logistics.
Filed 03/31/11 Page 15 of 17
Staff and Burson-Marsteller updated and posted to the Extranet the revised
Message Track and Q&A’s for the $50 note program.
Burson-Marsteller submitted documentation of calls to the following preferred
partners for stakeholder outreach efforts: Wal-Mart, National Association of
Federal Credit Unions, Sam's Club, and Ace.
Staff continues to research additional potential speaking opportunities, including
ethnic association events.
Staff submitted revised website and email language changes to be used with
online orders for $20 educational materials.
Staff and Burson-Marsteller continue to hold meetings to discuss action steps
and review timelines for $50 program elements.
A Public Education staff member is currently in Moscow working with BursonMarsteller's international team (PBN) and the Willard Group, to refine our public
education and unveiling strategies in Russia.
BEP and the State Department sent the first cable to embassies worldwide
regarding the $50 note education program. We are already receiving responses,
including contact names in various countries.
Staff has received a draft of the international Q&A’s from Burson-Marsteller's
international team and will be revising and customizing them for the local
marketplace in key $50 currency note countries.
correspondence inquiries, 90 e-mail inquiries, and mailed 70 general information
packets.
Staff responded to one internal and two external research requests.
Staff provided examples of the historical $50 currency note to Burson-Marsteller.
Office of Management Control conducted a physical inventory in Room 702-5A.
All items were accounted for.
Filed 03/31/11 Page 16 of 17
MARKETING DIVISION
PUBLIC SALES
($49,410). Year to date sales totaled $4,302,215, a decrease of 3% compared to
FY 2003 ($4,443,464).
The Mail Order Sales Department processed phone, fax, and mail orders on
March 11th and Internet orders on March 12th. A total of 148 orders were
processed during this reporting period. A total of 138 orders were mailed and 10
orders are open.
EXHIBITS AND SHOWS
No report.
- end of report -
Filed 03/31/11 Page 17 of 17

1 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF

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