Petition for Writ of Certiorari — Eqbal v. United States

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No. 011208 eB 15 2002

GFACE OF THE CLERK

In The

Supreme Court of the United States

ZULFIQAR EQBAL and SAMEENA IKBAL,

Petitioners,

UNITED STATES OF AMERICA.

On Petition For A Writ Of Certiorari

To The United States Court Of Appeals

For The Ninth Circuit

PETITION FOR A WRIT OF CERTIORARI

CHRISTOPHER J. CANNON

California Bar No. 88034

Counsel of Record

SUGARMAN & CANNON

44 Montgomery Street, Suite 2080

San Francisco, CA 94104

Telephone: 415/362-6252

Facsimile: 415/677-9445

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

POR

te eee nt mane mn ae

QUESTIONS PRESENTED

Whether the government may prosecute and convict

for an alleged false statement under 18 U.S.C. § 1001

when that statement is a legal conclusion which a court

has held is open to question.

I].

Whether the government, while engaged in civil liti-

gation with citizens over their legal status, may ignore

orders from a court of appeals and a district court to

conduct hearings to determine that legal status, and

instead, unilaterally, indict those individuals alleging

their legal conclusions are false statements.

LIST OF PARTIES

The parties to the proceedings below were the plain-

tiff, United States of America and the defendants-Peti-

tioners, Zulfiqar Eqbal and Sameena Ikbal. Plaintiff is

represented by John Lyons, Assistant United States Attor-

ney for the Northern District of California (San Fran-

cisco).

ill

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ....-----ssscssereenn ee i

LIST OF PARTIES ...-------ss0e0rre ii

RT aa ci auisacosasacencctesseecersset tele sc 1

OPINIONS BELOW....-------sss007 1

I. JURISDICTION.....-------0sssre 1

Il. CONSTITUTIONAL AND STATUTORY PRO-

VISIONS INVOLVED....------ss00 2

Il. STATEMENT OF THE CASE. ...-----++0°**"" 3

A. INTRODUCTION ...-------:*570700"* 3

B. PROCEDURAL BACKGROUND....------ 4

IV. REASONS FOR GRANTING THE WRIT .---- 11

A. INTRODUCTION....-------s7s770n 11

B. PETITIONERS WERE PROSECUTED

UNDER AN UNCONSTITUTIONALLY

VAGUE THEORY...------*:ss07 77 12

Cc. THE FAR DEFINITION OF PRINCIPAL,

INCLUDING THE TERM “AND SIMILAR

POSITIONS” IS TOO INDEFINITE TO

SUPPORT A § 1001 PROSECUTION ...-- 18

OF OTHER CIRCUITS AND WILL NOT

IMPEDE THE GOVERNMENT'S INTER-

EST IN OBTAINING HONEST INFORMA-

To. <a penaeessessuexeeses see ***

TABLE OF CONTENTS - Continued

Page

V. THIS COURT SHOULD FIND IT IS A DUE

VI.

PROCESS VIOLATION FOR THE GOVERN-

MENT TO INITIATE A CRIMINAL PROSECU-

TION BASED UPON A LEGAL CONCLUSION

THAT IT HAS FAILED TO CONVINCE A

COURT TO ACCEPT

CONCLUSION

TABLE OF AUTHORITIES

Page

CasEs

Brogan v. United States, 522 U.S. 398 (1998)....... 14, 15

Bronston v. United States, 409 U.S. 352 (1973) ..... 17, 18

Crowe v. Smith, 151 F.3d 217 (5th Cir. 1998) ......... 26

Dunn v. United States, 442 U.S. 100 (1979)........... 12

Granger v. Payton, 379 F.2d 709 (4th Cir. 1967)....... 26

Graynard v. City of Rockford, 408 U.S. 104 (1972)..... 12

Hubbard v. United Siates, 514 U.S. 695 (1995)...... 14, 16

Marshall v. Jerrico, Inc., 446 U.S. 238 (1980).......... 22

Morgan v. United States, 309 F.2d 234 (D.C. Cir.

DR 6s. dnd eS eadddscsivewee eee eee ee 14

Newton v. Rumery, 480 U.S. 386 (1987)............... 24

People v. Superior Court (Greer), 19 Cal.3d 255

3g Pe PEPE CT Pe Pe Per Pe ee Sere On re sy rere 24

Sameena, Inc. v. United States Air Force, 147 F.3d

oF 8, ee me | er) Ore Terry 1, 4, 5, 6

United States ex rel. S.E.C. v. Carter, 907 F.2d 484

(ee Rae nas awk vs eacds Sosa steee eel 25, 26

United States v. Alvarado-Sandoval, 557 F.2d 645

CR SO Rn oh eed bce kaw hueaebiees eee 28

United States v. Anderson, 579 F.2d 455 (8th Cir.

POPU eh54 5 ene RER OL EAA ee 15, 19

United States v. Armstrong, 517 U.S. 456 (1996)....... 29

United States v. Calhoun, 97 F.3d 518 (11th Cir.

ROR Khiin chides baa bboshassthabiank ii eee 15

TABLE OF AUTHORITIES - Continued

Page

United States v. Dale, 991 F.2d 819 (D.C. Cir. 1993) .... 15

United States v. DeZarn, 157 F.3d 1042 (6th Cir.

ROG << c vcckulcedcchecetdscnendaueteee tee 18

United States v. Diogo, 320 F.2d 898 (2nd Cir. 1963) .... 16

United States v. Erhardt, 381 F.2d 173 (6th Cir. 1967) .... 14

United States v. Gahagan, 881 F.2d 1380 (6th Cir.

BOGE). ccccccccccucdsvesseedeuuasseusveenueceues 16, 19

United States v. Gaudin, 515 U.S. 506 (1995).......... 16

United States v. Hooten, 662 F.2d 628 (9th Cir. 1981) .... 28

United States v. Mayer, 775 F.2d 1387 (9th Cir. 1985) .... 14

United States v. Migliaccio, 34 F.3d 1517 (10th Cir.

Ps 6c kacerel iecktn nese ehdobesnecieeleiewenee 15

United States v. Moses, 94 F.3d 182 (5th Cir.

BG 0 cv cccuskeceguséis ecaskecseaceeeee 15, 19

United States v. Race, 632 F.2d 1114 (4th Cir.

RO 6 occ ceccctsnavesvendeeceis ae 20, 21

United States v. Schafrick, 871 F.2d 300 (2nd Cir.

BO. oncesd000sssnendius bake eo 16

United States v. Sells Engineering, Inc., 463 U.S. 418

CTDUR ns 6 .cesédsducsdhads pebeneutuelealaeeee 24

United States v. Tobon-Builes, 706 F.2d 1092 (11th

COs GR ck vdunk ceeseactens Saas PL hae aeeema ted 22

United States v. Wiener, 96 F.3d 35 (2nd Cir. 1996) .... 15

United States v. Vesaas, 586 F.2d 101 (8th Cir.

WOTED «. o o'v cava Cestetececuhbecatbareasabeeiee 15, 19

(RSG) so cccctindvacsecccccccueuseussead 22, 23, 25, 26

Vii

TABLE OF AUTHORITIES - Continued

Page

STATUTES

EY Ber pears ees 23

Pe TE MED eacee dd ncecdensbcausdeceeutecer passim

Oe ey Wt b bab 5 bbe en one bad darn de och deokdcads 24

OF Cel IN so vc accu cdancdbocesencccceccn's 1

California Penal Code § 519 ........................ 23

MISCELLANEOUS

ay WO MS MI, UIs aS soy Kcr cbs bevbddédccan, 23

Model Code of Prof. Resp. EC 7-21 (1994) .......... 23

Northern District of California, Local i 23

PRAYER

The Petitioners, Zulfigar Eqbal and Sameena Ikbal,}

respectfully pray that a Writ of Certiorari issue to review

the judgment of the United States Court of Appeals for

the Ninth Circuit entered October 2, 2000.?

OPINIONS BELOW

The October 2, 2001, memorandum opinion of the

Court of Appeals for the Ninth Circuit denying Peti-

tioners’ appeal is unpublished, and is reprinted in the

appendix hereto. (App. 1-8.) The Ninth Circuit’s opinion

in a related civil matter is published at 147 F.3d 1148, 1154

(9th Cir. 1998). (App. 24-38.)

JURISDICTION

Jurisdiction of this Court is invoked under 28 U.S.C.

§ 1254(a)(1). This petition is filed within 90 days of the

denial of the Petition for Rehearing and Rehearing en

1 In 1994, Eqbal changed his name, due to a myriad of

personal and religious reasons, from Mirza Zulfiqar Ali to

Zulfigar Eqbal. At the same time and for the same reasons, Ikbal

changed her name from Sameena Ali to Sameena Ikbal, her

maiden name. (RT 7-937-939; 7-1053-1057.) Citations to “RT”

refer to the Reporter’s Transcript of the proceedings below.

Citations to “ER” refer to the Excerpt of Record filed in the

Ninth Circuit. Citations to “App.” refer to the appendix to this

petition for a writ of certiorari.

2 On November 20, 2001, the Ninth Circuit denied

Petitioners request for rehearing and rehearing en banc. United

States v. Eqbal and Ikbal, CR 00-10165 and 00-10217-CW. (App.

39-40.)

aia ata iii iil

Banc and is timely under the Rules of the Supreme Court

of the United States.

The Fifth Amendment to the United States Constitu-

II.

CONSTITUTIONAL AND STATUTORY

PROVISIONS INVOLVED

tion provides in relevant part:

No person . . . shall be deprived of life liberty, or

property, without due process of law.

18 U.S.C. § 1001 reads:

(a)

(b)

(c)

Except as otherwise provided in this sec-

tion, whoever, in any manner within the

jurisdiction of the executive, legislative, or

judicial branch of the Government of the

United States, knowingly and willfully -

(1) falsifies, conceals, or covers up by any

trick, scheme, or device a material fact;

(2) makes any materially false, fictitious,

or fraudulent statement or representa-

tion; or |

(3) makes or uses any false writing or

document knowing the same to con-

tain any materially false, fictitious, or

fraudulent statement or entry;

shall be fined under this title or imprisoned

not more than 5 years, or both.

Subsection (a) does not apply to a party to

a judicial proceeding, or that party’s coun-

sel, for statements, representations, writ-

ings, or documents submitted by such

party or counsel to a judge or magistrate in

that proceeding.

With respect to any matter within the juris-

diction of the legislative branch, subsection

(a) shall apply only to -

(1) administrative matters, including a

claim for payment, a matter related to

the procurement of property or ser-

vices, personnel or employment prac-

tices, Or support services, or a

document required by law, rule, or

regulation to be submitted to the Con-

gress or any office or officer within the

legislative branch; or

(2) any investigation or review, conducted

pursuant to the authority of any com-

mittee, subcommittee, commission or

office of the Congress, consistent with

applicable rules of the House or Sen-

ate.

Federal Accusation Regulation FAR 9.409(a)(2)

defines “principal” as:

officers; directors; owners; partners; and, per-

sons having primary management or super-

visory responsibilities within a business entity

(e.g., general manager; plant manager; head of a

subsidiary, division, or business segment, and

similar positions). (Emphasis added).

III.

STATEMENT OF THE CASE

A. INTRODUCTION.

While Petitioners were engaged in civil litigation

with the government over the legal conclusion of whether

Egbal was a “principal” in a company called Samtech,

Petitioners were indicted and convicted under 18 U.S.C.

§ 1001 for making the allegedly false statements that no

principals of Samtech had been debarred.

“Principal” is defined in Federal Accusation Regula-

tion FAR 9.409(a)(2), as noted supra, as:

officers; directors; owners; partners; and, per-

sons having primary management or super-

visory responsibilities within a business entity

(e.g., general manager; plant manager; head of a

subsidiary, division, or business segment, and

similar positions). (Emphasis added).°

In Sameena, Inc. v. United States Air Force, 147 F.3d at

1154 (App. 37) the Ninth Circuit held that Eqbal’s status

as a principal of Samtech was a question of fact. Within

weeks of that decision, and before the civil litigation was

resolved in Petitioners’ favor, the government indicted

Eqbal and claimed that Petitioners’ statements that no

principals of Samtech had been debarred were false state-

ments under 18 U.S.C. § 1001. This Court should grant

certiorari in this case to forbid § 1001 prosecutions for

statements based upon legal conclusions from uncertain

facts, and limit § 1001 prosecutions to instances where

defendants make statements of fact that are objectively

known to be false at the time the statements are made.

The rule we propose is the rule in the majority of Circuits.

B. PROCEDURAL BACKGROUND.

Zulfiqar Eqbal and his wife, Sameena Ikbal, operated

a computer products company called University Systems,

Inc. (“USI”). (RT 7-957:6-22.) In 1992, Eqbal, Ikbal and USI

became embroiled in a controversy with the Social Secu-

rity Administration (“SSA”) regarding false claims of the

3 During jury instructions, Appellants objected to this

definition on due process grounds and asked that the “similar

positions” language be stricken. (RT 6-877:1-7; ER 157-158.)

origin of a computer mouse (RT 2-59:13-25). See Sameena,

Inc. v. United States Air Force, 147 F.3d at 1150 (App. 25.)

Although there were no findings that Eqbal knew of the

false representations regarding the origin of the mouse,

the SSA Deputy Commissioner for Finance, Assessment

and Management recommended that Eqbal and USI be

debarred. A proposed debarment has the same practical

effect as an actual debarment, and immediately prohib-

ited Eqbal from soliciting, receiving or otherwise partici-

pating in any federal contracts or subcontracts. (RT

2-64:19-25; see FAR 9.405(a)-(c).)

Following the debarments, University Systems was

forced into bankruptcy. (RT 7-1008:14-22.) One of the

most valuable assets of University Systems was a contract

with the Department of Energy (“DOE”). The government

knew that Eqbal and Ikbal were husband and wife, knew

both had worked at USI, knew USI and Eqbal had been

debarred, but still agreed to the novation of the mainte-

nance contract from the debarred USI and Eqbal to

the still qualified Ikbal and Samtech. (ER 192.) This

novation could not have occurred unless the government

believed Eqbal was not a principal at Samtech. (RT

7-1010:11-7-1011:20; ER 192.)

On July 31, 1995, Samtech submitted a bid to the

government to provide laptop computers. (RT 3-209:3-24.)

That bid contained a certification that no debarred person

was a principal of Samtech. (RT 3-210:21-3-211:5; ER 92.)

The government disqualified Samtech from the bidding

process contending that certification was false because

Samtech employed Zulfiqar Eqbal, a debarred individual,

in a principal position within the company. (See, e.g., ER

199.) Based upon this allegedly false certification, the

government proposed both Ikbal and Egqbal (again) for

debarment. (RT 3-290:25-291:8; see ER 143.)

Petitioners then sued the government, openly and

notoriously claiming that Eqbal was not a principal of

Samtech, and sought to overturn their debarments alleg-

ing, among other things, that the government violated

their due process rights in failing to provide them with

an opportunity to present and cross-examine witnesses in

the debarment proceedings. Sameena, Inc. v. United States

Air Force, 147 F.3d at 1151. (App. 28-29.) The government

responded by filing a motion for summary judgment,

which the district court erroneously granted. Id.

Appellants appealed and won. The Ninth Circuit

found that because the evidence was in conflict and the

government had refused to grant a debarment hearing,

Eqbal’s original debarment and Petitioners’ later debar-

ments were improper. Sameena, Inc. v. United States Air

Force, 147 F.3d at 1153-1154 (App. 37-38); Ali v. Dept. of

Health and Human Services, et al., No. 97-15264.

While the appeals were pending, Eqbal and Ikbal

learned that the government had begun a criminal inves-

tigation and they retained Joseph Russoniello, the Former

United States Attorney for the Northern District of Cali-

fornia, to represent them. (ER 25.) According to Mr.

Russoniello, the government offered to enter into a plea

agreement calling for probation for both Eqbal and Ikbal

on the condition that Eqbal, Ikbal, and the entities drop

their civil litigation against the government. (ER 12-14;

26-29.) Eqbal and Ikbal refused to enter into the

4 The government filed a counter affidavit claiming that the

defense had brought up the subject of a global resolution of the

charges. (ER 18.) The district court, however, declined to resolve

proposed agreement. They won their appeals. (ER 97; 102;

App. 24-38.) The Ninth Circuit decided that Eqbal’s

alleged principal status was a question of fact and

remanded the case for a hearing and determination of

Egbal’s status. (App. 37.)

The government refused to participate in the hear-

ings ordered by the Ninth Circuit, and by the district

court on remand, to determine whether Eqbal was a

principal.5 Instead, the government unilaterally indicted

Eqbal and Ikbal and alleged that Petitioners’ legal conclu-

sion that Eqbal was not a principal, which Petitioners had

maintained throughout the debarment proceedings, in

the district court, and before the Ninth Circuit, (RT 3-294,

315) was a false statement under 18 U.S.C. § 1001.® (See

ER 46-57.)”

The fact of this new criminal indictment gave the

government the goal it had been unsuccessfully seeking:

disqualification of Petitioners from government contract-

ing. See FAR 9.405. At trial there was no evidence that

Eqbal held one of the positions identified as a “principal”

in the FAR, and the government’s case was not based

this factual dispute stating: “I suppose it would be somewhat

entertaining to have an evidentiary hearing in which Mr.

Russoniello and Mr. Burch swore that each other was lying

about their conversations, but not interesting enough to make

me want to do it.” (ER 23.)

5 As a result of the government’s refusal to hold the

ordered hearings, the district court dismissed the debarments

with prejudice. (ER 141.)

6 This indictment was a new and independent ground for

debarment.

7 Eqbal was first indicted on a charge of false statements to

a bank. That case, reversed on appeal, was combined with this

case, against both Petitioners, for trial.

upon a contention that Eqbal held one of the identified

positions.

Samuel Hilker, the Air Force Acting Deputy General

Counsel For Contractor Responsibility, had signed the

memorandum in support of Eqbal’s debarment. (RT 292.)

As indicated above, that debarment was based upon a

claim that Samtech had made a false statement that no

principals had been debarred. (RT 3-335.)

Hilker testified that his duties included interpreting

the FAR to determine whether a person was a “principal”

in a business. (RT 3-276, 3-349.) Hilker, however, was

unable to articulate a consistent definition of the term

“principal”:

Q: And a sales manager — would a sales man-

ager be a principal?

Could be.

Would a manager be a principal?

Could be.

But a manager may not be a principal?

: Possibly not.

(RT 3-302.)

Q: Everyone who conducts business on behalf

of a company is not a principal?

A: Possibly not.

(RT 3-304.)

Hilker contended that principal was defined, not by

the terms of the FAR, but by his official, private discretion:

Q: Now when Mr. Lyons asked you what

makes a principal, I want to make sure I got

your response correct. Did you say “it

makes someone a principal in my mind?”

Were those your words?

(RT 3-348.)

rFOPrOr

A: I don’t have a current and specific recollec-

tion of — of stating it that way.

Q: Because whether someone is a principal or

not is actually determined under the defini-

tion in the Federal Acquisition Regulations,

not in the definition in your mind, correct?

A: It’s part of my discretionary authority to

make that determination, so my mind is

very important.

(RT 3-349.)

Q: Are you free to broaden [the FAR]?

A: That determination is going to — is going to

rest on a number of matters, you know. I

can’t expand what the regulation states, but

I can construe it, and I can exercise my

discretion under it.

(RT 3-349.)

In its closing argument, the government conceded

that Eqbal did not hold one of the identified positions

and argued to the jury that Eqbal exercised authority: “in

a way that is similar to - and held a position similar to

those examples given in the definition;” (RT 8-1292; App.

43) and that while Eqbal’s role was important, his wife,

Ikbal “was the one that was really in charge.” (RT 8-1206;

App. 43.)

The jury was instructed in accordance with the “simi-

lar position” language. (RT 8-1186; App. 42.)

Accordingly, as the jury was instructed, and under

the arguments made, Petitioners could be, and were,

convicted for their legal conclusion that Eqbal was not a

principal of Samtech, even though he did not hold any of

the positions identified as a principal in the FAR.

The jury returned a guilty verdict against Zulfigar

Eqbal on one count of conspiracy and three counts of

making false statements to the government.® (RT

1326-1329; App. 15-16.) The jury found him not guilty of

three other counts of making false statements to a gov-

ernment agency. Id. The jury found Sameena Ikbal guilty

of one count of conspiracy and five counts of making

false statements to a government agency. (RT 1326-1329;

App. 9.)

On March 20, 2000, the district court sentenced Sam-

eena Ikbal to 60 months of probation, concurrent, on each

count of her conviction. (ER 228-231; App. 10.) On April

24, 2000, Zulfiqar Eqbal was sentenced to 30 months in

federal custody to be followed by a term of 48 months on

supervised release. (ER 235-240; App. 17.)9

On appeal, and in the trial court, Petitioners claimed

that the government's theory of prosecution violated due

process and was unconstitutionally vague because it used

18 U.S.C. § 1001 to criminalize a legal conclusion that

Eqbal was not a principal of Samtech and that there was

insufficient evidence Petitioners made any false state-

ments. Petitioners also sought discovery, alleging that the

government was using this criminal prosecution to

achieve the goals it could not achieve in its civil proceed-

ings.

8 Eqbal was also convicted of one count of bank fraud and

one count of false statements to a government agency. These

convictions were overturned by the Ninth Circuit at 266 F.3d

1242 (9th Cir. 2001).

9 Because this sentence was primarily based upon the

reversed bank fraud conviction, the Ninth Circuit remanded the

case for resentencing. (App. 7-8.)

IV.

REASONS FOR GRANTING THE WRIT

A. INTRODUCTION.

This case demonstrates the danger presented when

one party, the government, has the option to resort to

both civil and criminal litigation to obtain one goal, here

the disqualification of Petitioners from government con-

tracting. While the government and Petitioners were civ-

illy litigating whether Eqbal was a principal in Samtech,

and immediately after the Ninth Circuit decided that

whether Eqbal was a principal was an open question of

fact, the government indicted Petitioners, claiming the

legal conclusion that the Ninth Circuit had found to be an

open question of fact was a false statement in violation of

18 U.S.C. § 1001. In essence, this prosecution and convic-

tion were based upon the assumption that the govern-

ment’s legal conclusion that Eqbal was a principal was

infallible, and the Petitioners’ legal conclusions to the

contrary were false statements. This type of arbitrary law

enforcement strikes at the heart of Petitioners’ due pro-

cess rights under the Fifth Amendment.

This indictment also violated Petitioners’ rights to

fair notice of potential charges against them and these

convictions demonstrate the dangers this Court has pre-

viously noted which flow when the roles of prosecutor

and civil litigant are combined.

The problems presented by dual civil and criminal

proceedings in cases like this could be prevented if this

Court adopts the rule from the majority of Circuits that a

conviction for an alleged false statement charged as a

violation of 18 U.S.C. § 1001 may not stand if the charged

statement is ambiguous. If Eqbal’s status was ambiguous,

statements about that status could not be the predicate

for a § 1001 prosecution in the majority of Circuits. The

Ninth Circuit ignored that rule in affirming these convic-

tions.

Accordingly, this Court should clarify the law regard-

ing § 1001 prosecutions to clearly state that a prosecution

for a false statement under § 1001 may not be satisfied by

a statement that under the defendant's interpretation of

the facts could be true. As applied by the Ninth Circuit,

any statement of legal opinion becomes grounds for a

prosecution as a false statement if there is a difference of

opinion between the speaker and the government.

This Court should exercise its supervisorial role and

remind the Ninth Circuit that the government may not

prosecute individuals simply because they take a legal

position contrary to the government in civil litigation.

B. PETITIONERS WERE PROSECUTED UNDER AN

UNCONSTITUTIONALLY VAGUE THEORY.

Fundamental principles of due process require that

no individual be forced to speculate, at the risk of indict-

ment, whether his conduct is prohibited. Dunn v. United

States, 442 U.S. 100, 112 (1979); Graynard v. City of Rock-

ford, 408 U.S. 104, 108 (1972).

The term “principal” as defined under the FAR and

applied in this case is unconstitutionally vague because it

fails to give a person notice of what is prohibited and

grants law enforcement unfettered discretion to deter-

mine what acts are forbidden.

The Ninth Circuit rejected this argument by adopting

the government's argument that “because the vague reg-

ulations do not themselves contain criminal penalties, a

vagueness challenge is inapposite.” (App. 3.)*°

This “conclusion” ignores Petitioners’ clear and

repeated claim that the FAR was unconstitutionally vague

as applied as a predicate for a § 1001 prosecution because

the legal conclusion whether Eqbal was a principal has

not yet been decided. More importantly, however, and the

reason this court should review this issue, is that the

Ninth Circuit opinion makes it a crime to disagree with

the government in any forum other than a court.

Under the government's theory of prosecution in this

case, if an alien files a claim for asylum and loses, the

claim he is entitled to asylum is a prosecutable false

statement. Similarly, if a citizen pays his taxes but then

contests the assessment and files for refund, if he loses

his refund claim, he is guilty of making a false statement.

If an individual living near Federal land contests what

the government has described as the parcel boundaries, if

he is wrong, he is liable for making a false statement. The

1° Ironically, as it rejected Petitioners’ vagueness challenge,

the Ninth Circuit narrowed the “operative definition of the term

[principal]” to “persons having primary management or

supervisory responsibilities within a business entity.” (App. 4.)

This narrowed definition of the term principal mirrors

Petitioners’ rejected request that the jury be instructed as the

Panel suggested principal should be defined (RT 6-877; 1-7; ER

157-158) and does not explain how this narrowed “operative

definition” comports with jury instructions and argument based

upon the “similar positions.” Moreover, the government

conceded in argument that Eqbal was not the person having

primary management or supervisory responsibility at Samtech.

(App. 43.)

Ninth Circuit’s construction of § 1001 serves to elevate

any losing dispute with the government into a criminal

offense.

This Court has recognized the potentially broad

reach of § 1001, see, e.g., Hubbard v. United States, 514 U.S.

695, 709 (1995), and has noted that if § 1001 were to be

applied to representations made before the courts, § 1001

“might be interpreted to criminalize conduct that falls

well within the bounds of responsible advocacy.” Id. at

709. In order to avoid that problem, numerous courts of

appeals adopted a “judicial exception function” to the

broad language of § 1001. See, e.g., Morgan v. United States,

309 F.2d 234 (D.C. Cir. 1962); United States v. Erhardt, 381

F.2d 173, 175 (6th Cir. 1967); United States v. Mayer, 775

F.2d 1387, 1390 (9th Cir. 1985). That judicial exception

function was adopted by this Court in Hubbard v. United

States, 514 U.S. at 709 and recognized by Congress in the

1994 revision of § 1001 itself.

We would submit that all representations of legal

conclusions to any agency may be part of a similar advo-

cacy function and should not be a predicate for a false

statement prosecution.

In Brogan v. United States, 522 U.S. 398 (1998) several

members of this Court expressed concern that govern-

ment agents could use § 1001 to create crimes. Neverthe-

less, in Brogan, this Court recognized the broad reach of

§ 1001 and declined to depart from the text of the statute

to create an “exculpatory no” defense.

In her concurrence, however, Justice Ginsburg recog-

nized that the Brogan “opinion does not instruct lower

courts automatically to sanction prosecution or convic-

tion under § 1001 in all instances of false denials made to

criminal investigators.” Justice Ginsburg also noted that

LS <_< tll

both this Court and the Second Circuit left open the

question whether “to violate § 1001, a person must know

that it is unlawful to make such a false statement.” Id. at

416; United States v. Wiener, 96 F.3d 35, 40 (2nd Cir. 1996).

Justice Ginsburg noted that nothing suggested that “the

mere denial of criminal responsibility would be sufficient

to prove such [knowledge].” Brogan v. United States, 522

U.S. at 416, quoting United States v. Wiener, 96 F.2d at 40.

Here, there was not even a denial of criminal liability,

there was only an open and notorious statement of a legal

conclusion, a conclusion with which the government dif-

fered. It is now time to reach the question left open by

Wiener and Brogan. This Court should forbid § 1001 pros-

ecutions for disputes over legal conclusions, unless that

statement is made with an intent to deceive.

To avoid the problems referred to in Weiner and

noted by this Court in Brogan, the Fourth, Sixth, Eighth,

Tenth, Eleventh and District of Columbia Circuits have

held that when an alleged false statement is triggered by

ambiguous language in a contract or certification “the

government must negate any reasonable interpretation

that would make the defendant’s statement factually cor-

rect.” United States v. Anderson, 579 F.2d 455, 460 (8th Cir.

1978); United States v. Dale, 991 F2d 819 (D.C. Cir. 1993);

United States v. Migliaccio, 34 F.3d 1517 (10th Cir. 1994);

United States v. Calhoun, 97 F.3d 518 (11th Cir. 1996). The

Fifth Circuit has clearly stated that:

a prosecution for a false statement under Section

1001 or under the perjury statutes cannot be

based on an ambiguous question where the

response may be literally and factually correct.

. . » An indictment premised on a statement

which on its face is not false cannot survive.

United States v. Moses, 94 F.3d 182, 189 (Sth Cir. 1996)

citing United States v. Vesaas, 586 F.2d 101, 104 (8th Cir.

1978); United States v. Gahagan, 881 F.2d 1380, 1383 (6th

Cir. 1989).

If the Ninth Circuit had followed this rule, Peti-

tioners could not have been convicted, because as the

Ninth Circuit previously held, there was an open ques-

tion whether Eqbal was a principal.

The Second and Ninth Circuits, however, have taken

a contrary position, and have held that as long as the

issue of falsity is submitted to a jury, a defendant may be

prosecuted for ambiguous statements. United States v.

Schafrick, 871 F.2d 300 (2nd Cir. 1989) (false statement in a

ba: <ruptcy matter); but see United States v. Diogo, 320

F. 2d 898 (2nd Cir. 1963). While we agree that a jury must

be allowed to decide whether an individual statement is

false, a court should not even submit that question to the

jury if the allegedly false statement is not false on its face.

We are simply asking this Court to rule, in accor-

dance with the majority of Circuits which have addressed

this issue, that the government may not prosecute a

defendant under § 1001 for a statement which is not,

facially untrue, unless the government also proves that

the statement was designed to mislead.

Although this Court has not addressed the applica-

tion for § 1001 to ambiguous responses, in analogous

cases involving the perjury statute, which this Court has

observed “overlaps” § 1001, e.g., Hubbard v. United States,

514 U.S. at 714 n.14, this Court has held that perjury

prosecutions may not be based upon ambiguous ques-

tions and responses. Both perjury and § 1001 prosecu-

tions are similar in that they are prosecutions not for

harming another individual, but for offending against the

government itself. United States v. Gaudin, 515 U.S. 506,

515 (1995) and this Court has previously analyzed the law

of perjury in determining the elements of § 1001. Id.

In Bronston v. United States, 409 U.S. 352 (1973), this

Court stated that the federal perjury statute “does not

make it a criminal act for a witness to willfully state any

material matter that implies any material matter that he

does not believe to be true.” Bronston put the onus on the

questioner to clarify any misleading impression left by a

witness’s response, stating:

[i]t is the responsibility of the lawyer to probe;

testimonial interrogation, and cross-examination

in particular, is a probiftg, prying, pressing form

of inquiry. If a witness evades, it is the lawyer’s

responsibility to recognize the evasion and to

bring the witness back to the mark, to flush out

the whole truth with the tools of adversary

examination. Id. at 358-359.

Under Bronston, a perjury conviction may not be

based upon an answer under oath that is nonresponsive

and “arguably misleading by negative implication,” but

literally true. Id. at 353. In Bronston, the defendant testi-

fied that he did not have any Swiss bank accounts; when

asked whether he had ever had any such accounts, he

answered, “[t]he company had an account there for about

six months, in Zurich.” Id. at 354.-These answers were

literally true because the defendant did not personally

have any Swiss bank accounts at the time of the question-

ing, although his company did have a Swiss account. Id.

at 354-355. In the past, however, the defendant also had a

personal Swiss account. His perjury prosecution was

based on the theory that, in order to mislead the ques-

tioner, he answered the second question unresponsively,

teferring to the company’s account rather than his own,

implying he had no personal account at the relevant time.

Id. at 354.

In United States v. DeZarn, 157 F.3d 1042 (6th Cir.

1988), the Sixth Circuit noted that the purpose of the

Bronston rule is to prevent an examiner from resolving

ambiguities in the elicited testimony with a perjury pros-

ecution after the fact. The rationale behind Bronston

should apply with even more force to prosecutions under

§ 1001, where the questioning and the answers are not

supervised by the Court. Under the Ninth Circuit’s rul-

ing, any expression of opinion or conclusion, with which

the government disagrees, may subject the speaker to

prosecution under § 1001. Certainly many such prosecu-

tions would be barred by the First Amendment, but it is

questionable public policy to make citizens fearful of

voicing their opinions and conclusions to government

agents. Petitioners were prosecuted for the same legal

conclusion they took openly and notoriously before the

Ninth Circuit. If not for the judicial proceedings excep-

tion to § 1001, if they had not ultimately prevailed in the

debarment proceedings, they, and their counsel, could

have been prosecuted for the legal position taken in the

Ninth Circuit. This is an unprecedented expansion of the

reach of § 1001.

C. THE FAR DEFINITION OF PRINCIPAL, INCLUD-

ING THE TERM “AND SIMILAR POSITIONS” IS

TOO INDEFINITE TO SUPPORT A § 1001 PROS-

ECUTION.

Finally, the FAR definition of principal is ambiguous

and insufficient to support a § 1001 prosecution. Eqbal’s

status was open to question and Petitioners’ statements

that Eqbal was not a principal could not have supported a

perjury prosecution. Here, not even the government offi-

cial charged with determining whether an individual was

a principal could give a cogent explanation of what

makes someone a principal. No witness testified that

Eqbal had any of the positions specifically defined as a

principal under the FAR. He was not an officer, director,

owner, partner, and did not have primary management

responsibility in Samtech. (See RT 7-1007:11-16.) The gov-

ernment was forced to argue that Eqbal’s role was “simi-

lar” to that of a principal. (RT 8-1292:2-17; App. 43.)

Under these circumstances, Petitioners’ legal conclusions

that Eqbal was not a principal were not facially false.

[A] prosecution for a false statement under Sec-

tion 1001 or under the perjury statutes cannot be

based on an ambiguous question where the

response may be literally and factually correct.

. . An indictment premised on a statement

which on its face is not false cannot survive.

United States v. Moses, 94 F.3d at 189 citing United States v.

Vesaas, 586 F.2d at 104; United States v. Gahagan, 881 F.2d

at 1383.

In United States v. Anderson, 579 F.2d at 459, Leslie

Anderson was charged and convicted of making a false

statement in reimbursement certifications to receive fed-

eral highway funds. Anderson filled out four certifica-

tions that (1) CETA had not been billed for the project

and (2) “funds have not been received from the State or

expended for such services under any other contract

agreement or grant.” In fact, federal highway funds had

been irrevocably committed for services performed under

CETA, but the funds had not yet been received by the

contractor. Id.

The Eighth Circuit reversed, finding that the lan-

guage in the certification forms was ambiguous. The

Court concluded:

[i]Jn light of these ambiguities . . . it was incum-

bent upon the government to introduce proof

sufficient to establish the falsity of the state-

ments as well as the defendant’s knowing and

willful submission of the statements. In carrying

out that burden, government must negative [sic]

any reasonable interpretation that would make

the defendant’s statement factually correct. Id.

at 460.

Similarly, in United States v. Race, 632 F.2d 1114, 1120

(4th Cir. 1980), the Fourth Circuit heid that a defendant

did not make a false statement when the government did

not prove that the defendant’s interpretation of an ambig-

uous contract clause was unreasonable. In Race, the

defendant filed for per diem reimbursement expenses

under a government contract, even though he had not

actually paid his employees per diem expenses. The gov-

ernment conceded that the contract was ambiguous as to

whether the contractor could claim the reimbursement. In

response, the court held that because the clause was

ambiguous, there could be no false statement:

[w]hen the Government concedes the clause is

ambiguous, it necessarily concedes that the

defendants’ construction of the per diem clause,

which is one of the [two competing] construc-

tions, is reasonable. Such a conclusion requires a

ruling that the defendants cannot be convicted

under § 1001 for a statement or billing which

may be said to be accurate within a reasonable

construction of the contract. This is so because

one cannot be found guilty of a false statement

under a contract beyond a reasonable doubt

when his statement is within a reasonable con-

struction of the contract. Id.

Here, Petitioners only certified that Eqbal was not a

principal, and as Hilker testified, the definition of princi-

pal is subject to interpretation.

Moreover, as in Race, the testimony of the govern-

ment’s own witnesses highlights the ambiguity of the

FAR. As previously described, Samuel Hilker, the Deputy

General Counsel of the Air Force for Contractor Respon-

sibility, essentially testified that he was the discretionary

judge as to whether an individual is or is not a principal.

(RT 3-349:1-25:)

D. THE CLARIFICATION OF § 1001 PETITIONERS

SEEK WILL ALIGN THE NINTH CIRCUIT WITH

THE MAJORITY OF OTHER CIRCUITS AND

WILL NOT IMPEDE THE GOVERNMENT’S

INTEREST IN OBTAINING HONEST INFORMA-

TION.

The majority of Circuits which have addressed this

issue have decided a § 1001 prosecution requires a

facially false statement. See pg- 15 & 16 Introduction.

Contractors in the Ninth Circuit should have similar pro-

tection.

The Ninth Circuit has declined to follow the other

Circuits’ construction of § 1001 and allows conviction for

statements of legal opinion, as long as those statements of

opinion are not made in a judicial forum. This construc-

tion of § 1001 puts a dangerous burden on any individual

participating in any proceeding or transaction with the

government.

Contractors should not be forced to fill out forms at

peril of criminal liability if their interpretation of a vague

term varies from that of the government.

The construction of § 1001 that we seek will not

inhibit the government in its attempts to obtain honest

and candid responses from contractors. Section 1001 not

only criminalizes false statements to the government, as

charged in this case, it also criminalizes those who cover

up material facts. See United States v. Tobon-Builes, 706

F.2d 1092 (11th Cir. 1983). In situations such as this,

where a person’s status is in dispute, an individual

should be free to come to a legal conclusion and argue in

support of that conclusion, without risk that his legal

conclusion could subject him or her to a prosecution

under § 1001. Section 1001 wisely specifically excludes

from coverage such legal conclusions in judicial proceed-

ings. There is no good reason to be able to prosecute an

individual for sincerely held expressions of legal opinion

simply because that opinion is presented out of court.

THIS COURT SHOULD FIND IT IS A DUE PROCESS

VIOLATION FOR THE GOVERNMENT TO INITIATE

A CRIMINAL PROSECUTION BASED UPON A

LEGAL CONCLUSION THAT IT HAS FAILED

TO CONVINCE A COURT TO ACCEPT.

In Marshall v. Jerrico, Inc., 446 U.S. 238, 242 (1980) this

Court observed that a prosecutor’s direct pecuniary inter-

est in the outcome of a case that has an impact on the

prosecutor’s decision whether or not to enforce a particu-

lar statute may have constitutional ramifications. In

Young v. United States, 481 U.S. 787 (1987), this Court set

out a bright line rule forbidding counsel for the party

benefited by a civil ruling to be specially appointed to

prosecute violations of that rule as a contempt of court.

This Court specifically noted that:

if a Justice Department attorney pursued a con-

tempt prosecution for violation of an injunction

benefiting any client of that attorney involved in

the underlying civil litigation, that attorney

would be open to a charge of committing a

felony under § 208(a). Furthermore, such con-

duct would violate the ABA ethical provisions,

since the attorney could not discharge the oblig-

ation of undivided loyalty to both clients where

both have a direct interest. Id. at 805.

This Court summed up the heart of the problem with

the common sense observation that a prosecutor may be

tempted to bring a tenuously supported prosecution if

such a course promises financial or legal rewards for the

client. Id. Under the Model Code of Professional Respon-

sibility, “[a] lawyer shall not present or Participate in

presenting criminal charges solely to obtain an advantage

in a civil matter.” ABA Code of Prof. Resp. DR7-105(a)

(1969); see Cal. R. Prof. Resp. 5-110. As the drafting com-

mittee to DR-7-105(a) noted, the criminal process exists

for the protection of society as a whole, and that process

is undermined when it is used as a tool to force settle-

ment of private claims or controversies. Model Code of

Prof. Resp. EC 7-21 (1994). The civil process, which is

primarily designed for the settlement of disputes, is

impaired when the person against whom it is misused is

deterred from asserting his or her legal rights. Id. More-

over, the need to protect individuals from the whipsaw

effect of joint criminal and civil prosecution has been

recognized by state legislation. Just as this Court recog-

nized in Young that using a criminal prosecution for civil

advantage may violate 18 U.S.C. § 208(a), threatening

criminal prosecution for advantage in a civil case is a

violation of both California Penal Code § 519 and Califor-

nia Rule of Professional Responsibility 5-110.11 See also

11 Although the Department of justice has argued in the

past that the California Rules of Professional Responsibility are

not applicable to United States Attorneys, Local Rule 11 and the

People v. Superior Court (Greer), 19 Cal.3d 255, 261 (1977)

(“Nor should a prosecutor try a defendant with whom he

is embroiled in civil litigation.”).

In Newton v. Rumery, 480 U.S. 386 (1987) this Court

recognized that release dismissal agreements “may tempt

prosecutors to bring frivolous charges, or to dismiss mer-

itorious charges to protect the interest of other officials,”

id. at 396, and stated that “[a]ctions taken for these rea-

sons properly have been recognized as unethical.” Id. at

396 n.4. This Court acknowledged that these agreements

may infringe upon important interests of the criminal

defendant and of society as a whole, but held each case

must be examined on its own facts and that release dis-

missal agreements were not invalid per se. Id.

In United States v. Sells Engineering, Inc., 463 U.S. 418

(1982), this Court highlighted the problems presented by

government lawyers involving themselves in both civil

and criminal proceedings and barred government attor-

neys from obtaining automatic disclosure of grand jury

materials for use in civil proceedings. This Court stated

that:

because the Government takes an active part in

the activities of the grand jury, disclosure to

Government attorneys for civil use poses a sig-

nificant threat to the integrity of the grand jury

itself. If prosecutors in a given case knew that

their colleagues would be free to use the mate-

rials generated by the grand jury for a civil case,

they might be tempted to manipulate the grand

jury’s powerful investigative tools to root out

additional evidence useful in the civil suit, or

McDade Act, 28 U.S.C. § 530B, make California professional

conduct rules and decisions also applicable to attorneys in

federal practice within the state.

REE eS Somat ee et ee nee

even to start or continue a grand jury inquiry

where no criminal prosecution seemed likely.

Any such use of grand jury proceedings to elicit

evidence for use in a civil case is improper per

se... . We do not mean to impugn the profes-

sional characters of Justice Department lawyers

in general;. . . . Our concern is based less on any

belief that grand jury misuse is in fact wide-

spread than on our concern that, if and when it

does occur, it would often be very difficult to

detect and prove. Id. at 432 (citation omitted).

In Young v. United States, 481 U.S. 787 (1987), this

Court again recognized that an interested prosecutor can-

not proceed against a defendant without threatening the

integrity of the judicial system. In Young, the Louis Vuit-

ton company obtained an injunction prohibiting the

defendants from counterfeiting Louis Vuitton merchan-

dise. Id. at 790. Undeterred, the defendant continued to

sell counterfeit merchandise. Id. at 791. Vuitton’s attor-

ney’s successfully set up a sting to obtain evidence of

violations of the injunction, and convinced a court to

issue an Order to Show Cause why the defendants should

not be held in contempt for their violations of the injunc-

tion. Id. at 791-792. Vuitton’s attorney’s successfully pros-

ecuted the contempt and the defendants were found

guilty. Id. at 792.

This Court reversed the finding of contempt and held

that counsel for the party benefited by an underlying

injunction may not prosecute a contempt proceeding

based upon that injunction. Id. at 804.

In United States ex rel. S.E.C. v. Carter, 907 F.2d 484

(5th Cir. 1990), the Fifth Circuit relied upon this Court’s

decision in Young v. United States to conclude that a

government attorney who represented a party’s interest

in an underlying civil matter might not be able to impar-

tially discharge his or her duty as a prosecutor to make a

“dispassionate assessment of the propriety of criminal

charges.” Id. at 486.

As in S.E.C. v. Carter, in this case, the competing

interest flows from concurrent representation of the civil

and criminal interests of the government. Here, the gov-

ernment specifically attempted to use this criminal pro-

ceeding as a method to resolve a civil case, which was not

going well for the government. After it looked as if the

Ninth Circuit was not going to rule favorably, the govern-

ment began a criminal prosecution, and offered a proba-

tionary disposition in return for abandoning the civil

litigation. Just as in S.E.C. v. Carter, while the government

was locked in an on-going civil struggle with Petitioners,

the government used its power to pursue criminal

charges against Petitioners to attempt to resolve the civil

matter. This case is far more troubling than Young, where

this Court observed that a pending civil action in which

the special prosecutor had an interest theoretically could

tempt a prosecutor to use the criminal investigation to

gather information of use in those suits. Here the very

initiation of the criminal proceeding gave the government

the result it had been unsuccessfully seeking, the disqual-

ification of Petitioners from government contracting.

We contend, as the Fourth Circuit held in Granger v.

Payton, 379 F.2d 709 (4th Cir. 1967), that the prosecution

by an individual handling litigation against a defendant

violates the due process clause. See also Crowe v. Smith,

151 F.3d 217 (5th Cir. 1998) (following Young, the Fifth

Circuit found due process rights were violated where the

contempt prosecutor also represented a party).

Here, the government in general and the San Fran-

cisco United States Attorney’s Office in particular had

been attempting to bar Petitioners from contracting since

1992. In that attempt, however, the government did not

follow its own procedures and failed to give Petitioners a

hearing where they could make their case. Petitioners

fought back and eventually the Ninth Circuit ordered the

government to hold a hearing on Egbal’s status as a

principal. Instead of holding the ordered hearing, how-

ever, the government unilaterally indicted Eqbal and

Ikbal and alleged that Petitioners’ legal conclusion that

Eqbal was not a principal, which they had maintained

throughout the debarment proceedings in the district

court, and before the Ninth Circuit (RT 3-294, 315), was a

false statement under 18 U.S.C. § 1001. That indictment

had the same practical effect as an actual debarment, and

immediately prohibited Petitioners from soliciting,

receiving or otherwise participating in any federal con-

tracts or subcontracts (RT 2-64:19-25; see FAR 9.405(a)-(c)).

This is far more than a prima facie showing of

improper interest on the part of the San Francisco United

States Attorney’s Office. The proposed plea agreement

required Appellants to dismiss their civil suits against the

government. The plea agreement was proposed in June of

1998, at a time when Petitioners’ appeals were still pend-

ing, and if Petitioners had accepted the plea, the need for

a debarment hearing would have been avoided. For

whatever reason, as the government’s later conduct

shows, the government wanted to avoid that hearing.

The government’s hopes to resolve the civil cases

through the plea agreement were dashed when Eqbal and

Ikbal decided to follow through with their appeals and

continue with their civil actions. Eqbal and Ikbal finally

won their appeal on July 3, 1998; the next month, on

August 27, 1998, Eqbal was indicted. These facts present a

prima facie showing that the government brought this

case with an improper motive.

Facts far less egregious than those shown here have

been seen as evidence of potential violations of due pro-

cess and indicative of vindictive prosecution.

In United States v. Hooten, 662 F.2d 628, 634 (9th Cir.

1981), the defendant argued that the prosecution indicted

him because he exercised his rights to file civil actions

against an ATF Agent and various government agencies.

Although the court rejected the defendant’s claim in

Hooten because the Agent did not have the prosectorial

authority to decide whether to file chezges, the court

stated that the government’s choice to file a case may

support a charge of vindictive prosecution. Id.

In United States v. Alvarado-Sandoval, 557 F.2d 645 (9th

Cir. 1977), the Ninth Circuit found that the defendant's

due process rights were violated where there was evi-

dence of vindictive prosecution. In Alvarado-Sandoval, the

defendant entered into plea negotiations with the govern-

ment. The defendant rejected the government’s offer to

plead guilty to a misdemeanor, and later raised the possi-

bility of filing suppression motions. The government then

proceeded to charge the defendant with a felony, rather

than a misdemeanor. The defendant filed a motion to

dismiss the indictment based upon vindictive prosecu-

tion. He was eventually convicted of the felony, and then

appealed. In reversing the conviction, the court empha-

sized that the “[a]ppearance of vindictiveness, not vindic-

tiveness in fact, is the touchstone.” Id. at 646. The

appearance of vindictiveness was apparent because:

[i]t was only after the appellant, through his

counsel, indicated that no plea would be entered

and only after the understanding of possible

motions was referred to by the magistrate, that

the assistant United States Attorney indicated

that a felony indictment would be considered.

Id.

Here, there was a clear appearance of vindictiveness

and use of the criminal process to resolve the civil suits

on the part of the United States Attorney’s Office. This

appearance is shown not only through the timing of the

prosecution, but also through the declaration of the for-

mer United States Attorney for the Northern District of

California. He stated the government offered Petitioners

probationary sentences if they would dismiss all litiga-

tion against the government. This showing was specific,

detailed, and substantial. It was certainly “some evi-

dence” (see United States v. Armstrong, 517 U.S. 456 (1996)

(setting out standard for requiring discovery in selective

prosecution case)) of a due process violation and should

have led to a more detailed inquiry.

This Court has clearly indicated that an interested

prosecutor may violate a defendant’s right to due pro-

cess, and that each case must be examined on its own

facts. This Court has not stated, however, what a defen-

dant must show to require a hearing on prosectorial

motives. If “[a]ppearance of vindictiveness, not vindic-

tiveness in fact, is the touchstone,” district courts need

guidance to determine what to do when that appearance

of vindictiveness is shown. It is time for this Court to

remind the lower courts that even if the hearts of prose-

cutors may be pure, the appearance of justice is important

to all participants in the justice system. When, as here, the

timing of a prosecution, coupled with hard evidence from

a reputable source indicates the line separating criminal

and civil prosecutions may have been breached, the dis-

trict court must at least conduct an inquiry to assure that

the appearance of justice is not infringed.

Accordingly, we ask this Court to provide guidance

to lower courts to assist them in deciding what to do

when defendants have demonstrated an appearance of a

conflict by the prosecution.

VI.

CONCLUSION.

This case demonstrates the unfairness which flows

from mixing civil and criminal litigation. This Court has

the ability to insure that contractors are not punished for

legal disagreements in ambiguous circumstances. There is

no reason that § 1001 should have a lesser standard of

proof than a perjury prosecution; requiring the same

standard of proof will ensure that civil disagreements do

not ripen into criminal prosecutions. The majority of Cir-

cuits have all agreed that a factually ambiguous state-

ment is insufficient to support a § 1091 prosecution.

Accordingly, we request this Petition for Certiorari be

granted and that this Court direct the Ninth Circuit to fall

in line with its sister Circuits and forbid § 1001 prosecu-

tions unless the alleged statement is facially false.

Dated: February 15, 2002

Respectfully submitted,

CHRISTOPHER J. CANNON

Attorney for Zulfigar Eqbal

and Sameena Ikbal

App. 1

NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES

OF AMERICA, No. 00-10165

Plaintiff-Appellee, D.C. No. CR 99-40002 CW

SAMEENA R. ALI,

aka Sameena Ikbal,

Defendant-Appellant.

No. 00-10217

DC No. CR 99-40002: CW

MEMORANDUM*

(Filed Oct. 2, 2001)

OF AMERICA,

Plaintiff-Appellee,

MIRZA ALI, aka

Zulfigqar Eqbal, aka

Henry Stone,

)

UNITED STATES )

)

Defendant-Appellant.

)

Appeal from the United States District Court

for the Northern District of California

Claudia Wilken, District Judge, Presiding

Argued and Submitted May 14, 2001

San Francisco, California

* This disposition is not appropriate for publication and

may not be cited to or by the courts of this circuit except as

provided by Ninth Cir. R. 36-3.

App. 2

Before: O‘SCANNLAIN, TASHIMA, and THOMAS, Cir-

cuit Judges.

Sameena Ali appeals her conviction on one count of

conspiracy to make false statements to various govern-

ment agencies, in violation of 18 U.S.C. §§ 371 and 1001,

and on five counts of making false statements to a gov-

ernment agency, in violation of 18 U.S.C. § 1001. Mirza

Ali appeals his conviction on one count of conspiracy to

make false statements and three counts of making false

statements to a government agency. The defendants were

tried jointly in district court and their appeals have been

consolidated. Because the parties are familiar with the

facts of this case, we will not recite them here. We have

jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.

1. Prosecutorial Misconduct

Appellants contend that the prosecutor purposefully

elicited testimony that previously had been excluded as

privileged and then referred to the excluded and stricken

evidence during closing argument. We review for an

abuse of discretion a district court’s rulings on objections

to alleged prosecutorial misconduct. United States v. Sarki-

sian, 197 F.3d 966, 988 (9th Cir. 1999). Where counsel

objected to the acts of alleged prosecutorial misconduct at

trial, we review for harmless error. United States v. Cab-

rera, 201 F.3d 1243, 1246 (9th Cir. 2000).

With respect to the prosecutor’s questioning of the

witness, we find that no misconduct occurred. The pros- .

ecutor did nothing to elicit privileged testimony or to

prompt the witness’s response. See Sarkisian, 197 F.3d at

App. 3

988; United States v. Christophe, 833 F.2d 1296, 1301 (9th

Cir. 1987). With respect to the prosecutor’s comment dur-

ing closing argument, we believe the “misstatement has

earmarks of inadvertent mistake, not misconduct.” United

States v. Carillo, 16 F.3d 1046, 1050 (9th Cir. 1994). Even

assuming that there was misconduct, it was harmless.

The alleged misconduct consisted of only one brief, pass-

ing reference to excluded testimony and the court imme-

diately provided a curative instruction. The remark,

“followed by the court’s instruction, did not materially

affect the fairness of the trial.” United States v. Sayakhorn,

186 F.3d 928, 946 (9th Cir. 1999).

2. Vagueness of Federal Acquisition Regulations (“FAR”s)

Appellants contend that their due process rights

were violated because FAR § 9.409(a) and § 52.209-5(a)(2),

codified at 48 C.F.R. §§ 9.409(a) and 52.209-5(a)(2), are

unconstitutionally vague. Whether a regulation is uncon-

stitutionally vague is a question of law to de novo review.

United States v. Albers, 226 F.3d 989, 993 (9th Cir. 2000).

Here, however, such a vagueness challenge is inappropri-

ate because the regulations in question proscribe no con-

duct and were not enforced against the defendants;

rather, the defendants were charged under 18 U.S.C.

§ 1001 for false statements made to the government in

connection with the certification submitted pursuant to

the regulations. As such, a constitutional vagueness chal-

' lenge to the regulations themselves is inapposite. See, e.g.,

Bryson v. United States, 396 U.S. 64, 67-69 (1969) (rejecting

. vagueness challenge to underlying statutory provision in

the context of a false statement prosecution); United States

v. Harris, 185 F.3d 999, 1004 (9th Cir. 1999) (rejecting

App. 4

vagueness challenge by defendant charged with making

false statements on ERISA documents “because . . . it was

clear what he should do: truthfully fill out the ERISA

form according to the instructions”).

3. Sufficiency of the Evidence

Appellants contend that there is insufficient evidence

to establish beyond a reasonable doubt that they “know-

ingly and willfully” made false statements in the certi-

fication because the term “principal,” as defined in the

FARs, was ambiguous. The evidence was sufficient if,

viewing the evidence in the light most favorable to the

prosecution, any rational trier of fact could have found

the essential elements of the crime beyond a reasonable

doubt. Jackson v. Virginia, 443 U.S. 307, 319 (1979). The

operative definition of the term describes “persons hav-

ing primary management or supervisory responsibilities

within a business entity.” 48 C.F.R. § 52.209-5(a)(2). We

believe the definition is sufficiently clear for a rational

trier of fact to find that the defendants knowingly and

willfully made the false statements.

4. Exclusion of Notice Evidence

Appellants contend that the district court erred by

excluding evidence that Mirza Ali notified the govern-

ment of his debarred status. Evidentiary rulings made

during trial are reviewed for abuse of discretion. United

States v. Hankey, 203 F.3d 1160, 1166 (9th Cir. 2000).

Because the relevant issue was the identity of the

he ia aad A

App. 5

debarred individual, not his debarred status, such evi-

dence was irrelevant and thus its exclusion was not an

abuse of discretion.

5. Discovery on Selective/Vindictive Prosecution

Appellants contend. that the district court erred in

denying their motion for discovery regarding allegations

of selective or vindictive prosecution. We review a court’s

decision on whether to grant discovery related to a selec-

tive prosecution claim for abuse of discretion. United

States v. Candia-Veleta, 104 F.3d 243, 246 (9th Cir. 1996).

The standard of review for a claim of vindictive prosecu-

tion has not been settled. See United States v. Gamez-

Orduno, 235 F.3d 453, 462 n.9 (9th Cir. 2000) (recognizing

but not deciding the open question as to whether de

novo, clear error, or abuse of discretion review is appro-

priate).

The district court did not abuse its discretion when it

denied the motion for discovery with regard to the claim

of alleged selective prosecution because there was no

showing of “discriminatory effect” or “discriminatory

purpose.” Candia-Veleta, 104 F.3d at 246. With respect to

the allegation of vindictive prosecution, “a criminal

defendant may be entitled to discovery if he or she estab-

lishes a prima facie showing of a likelihood of vindictive-

ness by some evidence tending to show the essential

elements of the defense.” United States v. One 1985 Mer-

cedes, 917 F.2d 415, 421 (9th Cir. 1990). In order to estab-

lish a prima facie case,-a defendant “must show either

direct evidence of actual vindictiveness or facts that war-

rant an appearance of such.” United States v. Edmonds, 103

App. 6

F.3d 822, 826 (9th Cir. 1996) (quoting United States v.

Montoya, 45 F.3d 1286, 1299 (9th Cir. 1995)) (internal quo-

tation marks omitted).

The only facts alleged to support the vindictive pros-

ecution claim here were that Mirza Ali was offered a plea

that included a provision requiring dismissal of the pend-

ing civil suits challenging the debarments and that he

was indicted shortly after the debarments were reversed

on appeal. We have held that “the mere filing of an

indictment can support a charge of vindictive prosecu-

tion.” United States v. Hooton, 662 F.2d 628, 634 (9th Cir.

1981). However, “the link of vindictiveness cannot be

inferred simply because the prosecutor’s actions followed

the exercise of a right, or because they would not have

been taken but for exercise of a defense right.” United

States v. Gallegos-Curiel, 681 F.2d 1164, 1168 (9th Cir. 1982).

In other words, “[a] sequence of events is not enough; the

likelihood of retaliation is crucial.” Id. at 1171. There was

nothing to suggest that indictments were brought here in

retaliation for a civil appeal; in fact, the criminal investi-

gation had begun months before the plea offer was

broached or the civil appeal decided: Under any applica-

ble standard of review, there was no error in denying

discovery for a claim of vindictive prosecution.

6. Entrapment Instruction

Appellants contend that the district court erred by

denying an entrapment instruction because some false

statements were made in response to a request for infor-

mation by government officials after the decision had

already been made to cancel the relevant procurement.

App. 7

The standard of review for the court’s decision not to

provide the jury with a requested entrapment instruction

is unsettled. See United States v. Becerra, 992 F.2d 960, 963

(9th Cir. 1993). We need not address whether de novo or

abuse of discretion review is required here, however,

because under either standard the court’s denial of an

entrapment instruction was not error. “A defendant is

entitled to an entrapment instruction if he or she can

present some evidence that (1) a government agent

induced him or her to commit an illegal act that (2) he or

she was not predisposed to commit.” United States v.

Sotelo-Murillo, 887 F.2d 176, 179 (9th Cir. 1989). Because

the defendants presented no evidence to raise an issue of

fact regarding inducement to commit an illegal act, and

the relevant evidence actually suggests predisposition, an

entrapment instruction was properly denied. Cf. United

States v. Marbella, 73 F.3d 1508, 1512-13 (9th Cir. 1996)

(finding entrapment instruction unwarranted where

“there is no evidence the agents suggested to [defen-

dants] that they should submit the fraudulent medical

bills to the insurers” and “agents did not pressure [them]

and did not attempt to persuade them to engage in the

fraudulent activity.”).

For the foregoing reasons, the convictions of Sam-

eena Ali and Mirza Ali on the conspiracy count and on

the individual counts of making false statements to a

government agency are affirmed. In appeal No. 00-10217,

however, we vacate Mirza Ali’s sentence and remand for

resentencing. Mirza Ali was sentenced in a single, “con-

solidated” sentencing judgment in this case and in the

companion case, No. 00-10216, in which we have reversed

his conviction. Because his aggregate sentence was a

App. 8

“package,” United States v. Handa, 122 F.3d 690, 691-92

(9th Cir. 1997), we remand for resentencing on the counts

of conviction in this case.

Convictions AFFIRMED. Sentence in No. 00-10217

VACATED and REMANDED for resentencing.

App. 9

UNITED STATES DISTRICT COURT

Northern District of California

UNITED STATES

OF AMERICA

SAMEENA R. ALI,

aka: Sameena Ikbal

Defendant.

Case Number

CR 99-40002-02 CW

JUDGMENT IN A CRIMINAL CASE

(For Offense(s) Committed On or

After November 1, 1987)

(Filed March 28, 2000)

The defendant, SAMEENA R. ALI, was represented

by Christopher J. Cannon.

The defendant was found guilty on counts 1, 2, 4, 5,

7, and 11 of the Indictment after a plea of not guilty.

Accordingly, the defendant is adjudged guilty of the fol-

lowing counts, involving the indicated offenses:

Nature of

Title & Section Offense Count Number(s)

18 U.S.C. § 371 Conspiracy 1

18 U.S.C. § 1001 Making False 2, 4, 5, 7, and 11

Statements to

a Government

Agency

As pronounced on March 20, 2000, the defendant is

sentenced as provided in pages 2 through 4 of this Judg-

ment. The sentence is imposed pursuant to the Sentenc-

ing Reform Act of 1984.

App. 10

It is ordered that the defendant shall pay to the

United States a special assessment of $600.00 for counts 1,

2, 4, 5, 7, and 11, which shall be due immediately.

It is further ordered that the defendant shall notify

the United States Attorney for this district within 30 days

of any change of name, residence, or mailing address

until all fines, restitution, costs, and special assessments

imposed by this Judgment are fully paid.

Signed this the 28th day of March, 2000.

/s/ Claudia Wilken

CLAUDIA WILKEN

United States

District Judge

Defendant’s SSAN: 302-72-2115

Defendant’s Date of Birth: 01/29/54

Defendant’s address: 45030 Cougar Circle, Fremont, CA

94539

U.S. Marshal No.: 98433-011

PROBATION

The defendant is hereby placed on probation for a

term of 60 months on each count to run concurrent.

While on probation you shall not commit another

federal, state, or local crime and shall not illegally pos-

sess a controlled substance. Revocation of probation is

mandatory for possession of a controlled substance.

You shall pay the assessment imposed in accordance

with 18 U.S.C. Section 3013, and shall immediately notify

the probation officer of any change in your economic

circumstances that might affect your ability to pay a

App. 11

special assessment, fine, restitution, or co-payments

ordered by the Court.

If the judgment imposed a fine or a restitution obliga-

tion, it shall be a condition of supervision that you pay

any such fine or restitution that remains unpaid at the

commencement of the term of supervision in accordance

with any Schedule of Payments set forth in the Criminal

Monetary Penalties sheet of the judgment. In any case,

the defendant shall cooperate with the probation officer

in meeting any financial obligations.

Revocation of probation is mandatory for refusal to

comply with drug testing imposed as a condition of

supervision. 18 U.S.C. Sections 3565(b)(3) and 3583(g)(3)

STANDARD CONDITIONS OF PROBATION

It is the order of the Court that you shall comply with the

following standard conditions:

1) You shall not leave the judicial district or

other specified geographical area without

the permission of the court or probation

officer;

2) You shall report to the probation officer as

directed by the Court or probation officer,

and shall submit a truthful and complete

written report within the first five days of

each month;

3) You shall answer truthfully all inquiries by

the probation officer and follow the

instructions of the probation officer;

10)

App. 12

You shall support your dependents and

meet other family responsibilities, includ-

ing but not limited to, compliance with the

terms of any court order or administrative

process pursuant to the laws of a state, the

District of Columbia, or any other posses-

sion or territory of the United States,

requiring payment by you for the support

and maintenance of any child or of a child

and the parent with whom the child is

living;

You shall work regularly at a lawful occu-

pation unless excused by the probation

officer for schooling, training, or other

acceptable reasons;

You shall notify the probation officer ten

(10) days prior to any change in residence

or employment;

You shall consume no alcohol if sentenced

to the special condition that you are to

participate in a drug/alcohol program,

You shall refrain from excessive use of

alcohol and shall not purchase possess,

use, distribute, or administer any con-

trolled substance or any paraphernalia

related to any controlled substance, except

as prescribed by a physician;

You shall not frequent places where con-

trolled substances are illegally sold, used,

distributed, or administered;

You shall not associate with any persons

engaged in criminal activity, and shall not

associate with any ‘person convicted of a

felony unless granted permission to do so

by the probation officer;

11)

12)

13)

14)

App. 13

You shall permit a probation officer to visit

him or her at any time at home or else-

where and shall permit confiscation of any

contraband observed in plain view by the

probation officer;

You shall notify the probation officer

within seventy-two (72) hours of being

arrested or questioned by a law enforce-

ment officer;

You shall not enter into any agreement to

act as an informer or a special agent of a

law enforcement agency without the per-

mission of the court;

You shall notify third parties of risks

related to your criminal record, personal

history, or characteristics, and shall permit

the probation officer to make such notifica-

tions and/or confirm your compliance with

this notification requirement.

SPECIAL CONDITIONS OF PROBATION

While the defendant is on probation pursuant to

Judgment:

1) The defendant shall pay the special assess-

ment that is imposed by this judgment.

2) The defendant shall be prohibited from

engaging in self-employment without the.

prior permission of the probation officer.

3) The defendant shall not hold a position of.

fiduciary capacity without the prior per-

mission of the probation officer.

this

App. 14

4) The defendant is prohibited from being

involved in the contracting business with-

out the prior permission of the probation

officer.

5) The defendant shall perform 500 hours of

community service at the direction of the

probation officer.

6) The defendant shall provide the probation

officer access to any requested financial

information.

7) The defendant shall provide her true name,

Sameena Iqbal, and date of birth at all

times.

STATEMENT OF REASONS

The court adopts the factual findings and guideline

application in the presentence report.

Guideline Range Determined by the Court:

Total Offense Level: 8

Criminal History Category: 1

Imprisonment Range: 0 months to 6 months

Supervised Release Range: 2 to 3 years

Fine Range: $1,000 to $10,000

Restitution: $ none

The court declines to impose a fine in light of the

amount of restitution to be imposed against her hus-

band/co-defendant.

The sentence is within the guideline range, that range

does not exceed 24 months, and the court finds no reason

to depart from the sentence called for by application of

the guidelines.

App. 15

UNITED STATES DISTRICT COURT

Northern District of California

UNITED STATES

OF AMERICA Case Numbers

; ‘ CR 98-40159-01 CW

: CR 99-40002-01 CW

MIRZA ALI, aka Zulfigar

) Eqbal, aka Henry Stone,

Defendant.

BRL SARA N EM AAAI Sle TNE BPR RESON NE Ae

bass Hees icing

JUDGMENT IN A CRIMINAL CASE

(For Offense(s) Committed On or

After November 1, 1987)

(Filed April 28, 2000)

The defendant, MIRZA ALI, was represented by

Christopher J. Cannon.

ee a a A LET RCL IT TEEN ISLE SAE NPN

The defendant has been found not guilty on counts 2,

6, and 9 of the Indictment filed in CR-99-40002 CW, and is

discharged as to such counts.

chiar ic Seiten inc Sedbacie es Ds is Saanich

The defendant was found guilty on counts 1 and 2 of

the Superseding Indictment filed in CR-98-40159 CW and

guilty on counts 1, 3, 8, and 10 of the Indictment filed in

CR-99-40002 CW after a plea of not guilty. Accordingly,

the defendant is adjudged guilty of the following counts,

involving the indicated offenses:

».

Title & Nature of | Count Number(s)

Section Offense

18 U.S.C. Bank Fraud 1

§ 1344(1) (CR-98-41059 CW)

App. 16

18 U.S.C. Making False 2 (CR-98-40159 CW)

§ 1014 Statements to Obtain ~

Bank Loan

18 U.S.C. Conspiracy 1 (CR-99-40002 CW)

§ 371

18 U.S.C. Making False 3, 8, 10

§ 1001 Statements to an (CR-99-40002 CW)

Agency of the

United States

As pronounced on April 24, 2000, the defendant is

sentenced as provided in pages 2 through 6 of this

Judgment. The sentence is imposed pursuant to the

Sentencing Reform Act of 1984.

It is ordered that the defendant shall pay to the

United States a special assessment of $600.00 for counts 1

and 2 in CR-98-40159 CW and counts 1, 3, 8, and 10 in

CR-99-40002 CW, which shall be due immediately.

It is further ordered that the defendant shall notify

the United States Attorney for this district within 30 days

of any change of name, residence, or mailing address

until all fines, restitution, costs, and special assessments

imposed by this Judgment are fully paid.

Signed this the 28th day of April, 2000.

/s/ Claudia: Wilken

CLAUDIA WILKEN

United States

District Judge

App. 17

Defendant’s SSAN: 611-78-9260

Defendant’s Date of Birth: 10/19/47

Defendant’s address: 45030 Cougar Circle, Fremont, CA

94539

U.S. Marshal No.: 98962-011

IMPRISONMENT

The defendant is hereby committed to the custody of

the United States Bureau of Prisons to be imprisoned for

a term of THIRTY (30) months on counts 1 and 2 in

CR-98-40159 CW and counts 1, 3, 8 and 10 in CR-99-40002

CW. The terms of imprisonment shall run concurrent on

all counts.

The surrender of defendant is stayed pending his

appeal to the 9th Circuit Court of Appeals. The defendant

is released on his own recognizance under the previous

terms and conditions of pretrial release pending the

defendant’s appeal. The defendant shall surrender for

service of sentence at the institution designated by the

Bureau of Prisons within 10 days after issuance of the

mandate by the Court of Appeals.

RETURN

I have executed this Judgment as follows:

App. 18

Defendant delivered on to at

, with a certified copy of this Judgment.

United States Marshal

Deputy Marshal

SUPERVISED RELEASE

Upon release from imprisonment, the defendant shall

be on supervised release for a term of 48 months on

counts 1 and 2 in CR-98-40159 CW, and 36 months on

counts 1, 3, 8 and 10 in CR-99-40002 CW. The terms of

supervised release shall run concurrent to each other.

While on Supervised Release you shall not commit

another federal, state or local crime and shall not illegally

possess a controlled substance. Revocation of supervised

release is mandatory for possession of a controlled

substance. ;

You shall pay the assessment imposed in accordance

with 18 U.S.C. Section 3013, and shall immediately notify

the probation officer of any change in your economic

circumstances that might affect your ability to pay a

special assessment, fine, restitution, or co-payments

ordered by the Court.

If the judgment imposed a fine or a restitution

obligation, it shall be a condition of supervision that you

pay any such fine or restitution that remains unpaid at

the commencement of the term of supervision in

accordance with any Schedule of Payments set forth in

the Criminal Monetary Penalties sheet of the judgment.

App. 19

In any case, the defendant shall cooperate with the

probation officer in meeting any financial obligations.

Revocation of supervised release is mandatory for

refusal to comply with drug testing imposed as a

condition of supervision. 18 U.S.C. Sections 3565(b)(3)

and 3583(g)(3)

STANDARD CONDITIONS OF SUPERVISED RELEASE

It is the order of the Court that you shall comply with the

following standard conditions:

You shall not leave the judicial district or

other specified geographical area without

permission of the court or probation

officer;

You shall report to the probation officer as

directed by the Court or the probation

officer, and shall submit a truthful and

complete written report within the first

five days of each month;

You shall answer truthfully all inquiries by

the probation officer and follow the

instructions of the probation officer;

You shall support your dependents and

meet other family responsibilities,

including but not limited tc, compliance

with the terms of any court order or

administrative process pursuant to the

-laws of a state, the District of Columbia, or

any other possession or territory of the

United States, requiring payments by you

‘for the support and maintenance of any

child or of a child and the parent with

whom the child is living;

10)

11)

12)

App. 20

You shall work regularly at a lawful

occupation unless excused by the

probation officer for schooling, training, or

other acceptable reasons;

You shall notify the probation officer ten

(10) days prior to any change in residence

or employment;

You shall consume no alcohol if sentenced

to the special condition that you are to

participate in a drug/alcohol program;

You shall refrain from excessive use of

alcohol and shall not purchase possess,

use, distribute, or administer any

controlled substance or any paraphernalia

related to any controlled substance, except

as prescribed by a physician;

You shall not frequent places where

controlled substances are illegally sold,

used, distributed, or administered;

You shall not associate with any persons

engaged in criminal activity, and shall not

associate with any person convicted of a

felony unless granted permission to do so

by the probation officer;

You shall permit a probation officer to visit

you at any time at home or elsewhere, and

shall permit confiscation of any contraband

observed in plain view by the probation

officer; :

You shall notify the probation officer

within seventy-two (72) hours ‘of being

arrested or questioned by a law enforce-

ment officer;

App. 21

13) You shall not enter into any agreement to

act as an informer or a special agent of a

law enforcement agency without the

permission of court;

14) You shall notify third parties of risks

related to your criminal record, personal

history, or characteristics, and shall

permit the probation officer to make such

notifications and/or confirm your

compliance with this notification re-

quirement.

SPECIAL CONDITIONS OF SUPERVISION

While the defendant is on supervised release pursuant to

this Judgment:

1) The defendant shall pay any restitution

and special assessment that is imposed by

this judgment and that remains unpaid at

the commencement of the term of

supervised release as directed by the

probation officer.

2) The defendant is prohibited from engaging

in self-employment, including acting as a

consultant to a family owned business.

3) The defendant shall not maintain a position

of fiduciary capacity without the prior

permission of the probation officer.

4) The defendant is prohibited from being

involved in the contracting business.

5) The deferidant shall provide the probation

officer access to any requested financial

information.

App. 22

6) The defendant shall not possess any false

identification and shall provide his true

name of Zulfiqar Eqgal and date of birth of

10/19/47 at all times.

RESTITUTION AND FORFEITURE

RESTITUTION

The court, pursuant to the Victim and Witness

Restitution Act, finds that the following is a victim of

defendant’s criminal conduct and has sustained loss in

the indicated amount and orders restitution by the

defendant as follows:

Name & address of payee(s) Amount

Cupertino National Bank, $602,268.20

2860 West Bayshore Road,

Palo Alto, CA 94303

(Attn: Patrick Pierce,

Vice President, Special Assets)

Payments of restitution are to be made to Clerk, U. S.

District Court, for transfer to the payee.

Restitution is due and payable immediately and may

be collected in accordance with the Bureau of Prisons

Inmate Financial Responsibility Program. Any balance

that remains unpaid at the commencement of supervised

release shall be paid as directed by the probation officer.

STATEMENT OF REASONS

The court adopts the factual findings and guideline

application in the presentence report as stated on the

" record in court. The court finds the Offense Level,

App. 23

Criminal History Category, and Guideline Range as

found by the Probation Officer and sentences the

defendant to the low end of the Guideline Range of 30

months custody of the Bureau of Prisons.

Guideline Range Determined by the Court:

Total Offense Level: 19

Criminal History Category: 1

Imprisonment Range: 30 months to 37 months

Supervised Release Range: 3 to 5 years

ig (CR-98-40159 CW)

2 to 3 years

(CR-99-40002 CW)

Fine Range: $6,000 to $1,000,000

Restitution: $602,268.20

The court declines to impose a fine because payment

of a fine would interfere with the defendant’s ability to

pay restitution.

App. 24

United States Court of Appeals,

Ninth Circuit.

SAMEENA INC., an Oregon corporation dba

Samtech Research; Sameena Ali; Mirza

Ali, Plaintiffs-Appellants,

Vv.

UNITED STATES AIR FORCE; V. Carol

Moore; Steve Bangs; Alan Schoenberg;

Maxwell Air Force Base; Pilson; Mike

Thomason, Defendants-Appellees.

No. 97-15252.

Argued and Submitted Feb. 10, 1998.

Decided July 6, 1998.

]. Christopher Hall, Oakland, CA, Joseph P. Russoniello,

Ann M. Mooney, Cooley Godward LLP, San Francisco, CA,

for plaintiffs-appellants.

John N. Hemann, Assistant United States Attorney,

San Francisco, CA, for defendants-appellees.

Appeal from the United States District Court for the

Northern District of California; Fern M. Smith, District

Judge, Presiding. D.C. No. CV-96-01889-FMS.

Before: D.W. NELSON, BOOCHEVER, and REIN-

HARDT, Circuit Judges.

D.W. NELSON, Circuit Judge:

This case arises from a contractor’s alleged attempts

to defraud the government and the government’s efforts

to bar the contractor from bidding on future government

projects. The appellants bring civil rights and common-

law tort claims against a number of individual employees

of the United States Air Force (the “Air Force”) and argue

App. 25

that the Air Force’s decision to debar them for a period of

fifteen years was arbitrary and capricious, in violation of

the Administrative Procedure Act (“APA”), codified in

pertinent part at 5 U.S.C. § 704. The district court dis-

missed the claims against the individual defendants and

granted summary judgment in favor of the Air Force on

the APA claims. We have jurisdiction pursuant to 28

U.S.C. § 1291. Although we affirm the dismissal of the

claims against the individual defendants, we reverse the

district court’s summary judgment because we conclude

that the Department of the Air Force (the “Air Force”)

violated the appellants’ constitutional right to due pro-

cess when it denied them an evidentiary hearing, as

required by 48 C.F.R. § 9.406-3(b)(2).

FACTUAL AND PROCEDURAL BACKGROUND

In February 1992, the Social Security Administration

(“SSA”) solicited bids from computer suppliers for a

quantity of microcomputer workstations. University Sys-

tems, Inc. (“USI”), a California-based corporation of

which Appellant Mirza Ali was Chief Executive Officer,

submitted a proposal to the SSA in April 1992. USI’s bid

was deemed competitive, and USI provided the SSA with

samples of its products for further evaluation.

During this process, questions arose regarding

whether a mouse device included in the proposal was

manufactured in compliance with the Trade Agreements

_ Act of 1979, 19 U.S.C. §§ 2501-2582. While this matter was

being investigated, it was discovered that two USI offi-

cers had submitted a fraudulent letter to the SSA. The

App. 26

SSA consequently eliminated USI from consideration for

the workstation contract.

Subsequently, the United States Department of

Health and Human Services (“HHS”), of which the SSA is

part, commenced “debarment” proceedings against USI

and four of its officers, including Mirza Ali, seeking to

disqualify them from submitting government contract

proposals for three years. On February 2, 1994, USI,

Mirza Ali, and the other USI officers were debarred from

government contracting through February 18, 1996.

Mirza Ali’s wife, Appellant Sameena Ali, is president

and sole director of Appellant Sameena Inc. (“Sameena”),

which was incorporated in February 1993 by Keith

Griffen, a USI officer. Each of the appellants uses aliases:

Sameena Ali sometimes goes by “Sameena Ikbal.” Mirza

Ali sometimes goes by “Zulfiqar Eqbal.” Sameena Inc.

operates under the assumed name “Samtech Research,

Inc.” (“Samtech”).

Like USI, Samtech supplied computer workstations

to government agencies. In June 1995, an Alabama-based

contracting squadron of the Air Force issued a contract

solicitation for laptop computers. An amendment to the

solicitation indicated that the buyer was V. Carol Moore.

Samtech submitted a proposal to Moore in July 1995.

Included in Samtech’s proposal was a certification that

neither Samtech nor any of its principals was debarred or

proposed for debarment at that time. The certification

defined “principals” as “officers; directors; owners; part-

ners; and persons having primary management or super-

visory_ responsibilities within a business entity.” Because

the Air Force solicitation required that bidders have at

App. 27

least three years of experience as a government contrac-

tor, Samtech’s proposal also included a list of “Govern-

ment Contract Awards.” Among them was a contract

with the United States Department of Energy (the “DoE

contract”) that Sameena had obtained in 1994 through a

novation from USI.

In response to a query, Samtech sent Moore a letter in

September 1995 explaining that Samtech “started doing

business with the Federal Government by acquiring a

contract for the supply of ADP equipment to the United

States Department of Energy in 1992.” On further investi-

gation, Moore discovered that the contract actually had

been awarded to USI in 1992 and had only been novated

to Samtech in 1994. Moore also obtained bank documents

indicating that “Sameena Ikbal” and “Zulfiqar Eqbal”

were authorized to make withdrawals from Samtech’s

accounts and were, respectively, “President/Secretary”

and “Vice President” of the corporation. This information

appeared to Moore to contradict the statements made in

Samtech’s contract proposal.

On the basis of these apparent misrepresentations,

Samtech was deemed ineligible for the Air Force contract.

Moreover, in December 1995, the Air Force Contracting

Officer, Gladys McBride, submitted a recommendation

that Samtech be debarred. McBride appended the entire

administrative file to her recommendation, including an

affidavit by Moore describing her investigations.

On December 26, 1995, Sameena Inc., Samtech, Sam-

eena Adi, and -Mirza Ali (“the appellants”) were notified

that they had been proposed for debarment (and, in

Mirza Ali’s case, an “extension” of debarment). The

App. 28

notices were accompanied by memoranda setting forth

the grounds for the proposed debarments. The notices

also invited the appellants to submit information and

argument in opposition to the debarment.

The appellants included in their response a letter

dated February 21, 1996, from an official at Samtech’s

bank. The letter stated that the document indicating that

Zulfigqar Eqbal was Vice President of Samtech — a bank

signature card — had been “corrected” after the bank was

informed “that Eqbal was not a corporate officer” of

Sameena or Samtech. The submission also included

copies of checks written on Sameena’s bank accounts. A

number of these checks were signed by “Zulfiqar Eqbal”

and were made out to a variety of payees, including

physicians, a sports club, and Eqbal (Mirza Ali) himself.

The appellants’ submission also requested an evidentiary

hearing on the issue of Mirza Ali’s role at Samtech. Not-

withstanding the submission, and without an evidentiary

hearing, the Air Force issued a final decision in June 1996

to debar Sameena/Samtech and Sameena Ali — and to

extend Mirza Ali’s debarment — until December 2010. The

debarment was based on findings that the appellants had

(1) made false statements regarding Samtech’s experience

as a contractor, (2) provided false certifications that none

of Samtech’s principals was debarred, and (3) partici-

pated in a scheme to avoid the effects of USI’s debarment.

On August 30, 1996, the appellants filed two com-

plaints in the United States District Court for the North-

ern District of California. The first complaint, brought by

Mirza Ali against HHS and against six agency employees

in their individual capacities, focused on Ali’s initial

debarment and sought declaratory relief and damages.

App. 29

The second complaint, brought by Mirza Ali, Sameena

Ali, and Sameena/Samtech against the Air Force and

seven Air Force employees in their individual capacities,

focused both on the debarment of Sameena/Samtech and

Sameena Ali and on the extension of Mirza Ali’s debar-

ment.

This second complaint made substantially the same

allegations as the first, even though it was directed at

entirely different defendants. The appellants alleged (1)

that the individual Air Force officials had conspired to

violate their civil rights and had committed several com-

mon-law torts and (2) that the Air Force’s decision to

debar them was arbitrary and capricious and should be

set aside pursuant to the APA.

—

In an order filed December 11, 1996, the district court

dismissed the claims against the individual defendants

for lack of personal jurisdiction and, alternatively, on the

grounds that the appellants had failed either to plead

conspiracy with sufficient particularity or to comply with

the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b),

2671-2680. The court also granted summary judgment to

the Air Force on the APA claims. The appellants timely

appeal. We affirm the district court’s dismissal of the

claims against the individual defendants but reverse\the

summary judgment in favor of the Air Force.

STANDARD OF REVIEW

A dismissal with leave to amend is reviewed de

novo. Dumas v. Kipp, 90 F.3d 386, 389 (9th Cir.1996). A

grant of summary judgment is also reviewed de novo.

Covey v. Hollydale Mobilehome Estates, 116 F.3d 830, 834

App. 30

(9th Cir.1997). The standards governing review of the

district court’s individual determinations are addressed

below.

ANALYSIS

I. The district court properly determined that the appellants

failed adequately to plead conspiracy.

The district court determined that the appellants

failed to “allege conspiracy with sufficient particularity.”

We agree. The appellants failed to allege facts to support

their allegations that the individual defendants agreed

illegally to debar them or that they agreed to discriminate

against them because of their race. Accordingly, we

affirm the district court’s dismissal of th: conspiracy

count. See Karim-Panahi v. Los Angeles Pole Dep't, 839

F.2d 621, 627 (9th Cir.1988).1

II. The district court properly dismissed the tort claims

against the individual defendants.

The district court dismissed the appellants’ common

law tort claims against the individual defendants on the

1 Because we affirm the district court’s dismissal of the

conspiracy claims against the individual defendants, we need

not decide whether the district court had personal jurisdiction

over the individual defendants. See Lee v. Beaumont, 12 F.3d 933,

937 (9th Cir.1993) (“A court may assume the existence of

personal jurisdiction and adjudicate the merits in favor of the

defendant without making a definitive ruling on jurisdiction.”).

We also need not reach the appellants’ claim that the district

court erred in staying discovery regarding the personal

jurisdiction issue.

App. 31

ground that the appellants had failed to comply with the

Federal Tort Claims Act (“FTCA”), 28 U.S.C. §§ 1346(b),

2671-2680. The district court did not err in this determina-

tion.

Pursuant to 28 U.S.C. § 2679(d), the United States

was properly substituted for the individual defendants.

United States Attorney Michael Yamaguchi certified that

the federal employees named in the complaint were act-

ing within the scope of their employment, see 28 U.S.C.

§ 2679(d)(1); 28 C.F.R. § 15.3, and the complaints did not

present any evidence to the contrary. The appellants do

not contest that the defendants’ jobs required them to

assess the integrity of government contractors and to

recommend and effect debarment where appropriate.

Thus, even if the defendants’ debarment decisions were

based upon improper motives, the debarment was plainly

within the scope of the defendants’ employment. See

Wilson v. Drake, 87 F.3d 1073, 1076 (9th Cir.1996).

Given the United States’ substitution, the appellants

were required to present their tort claims to the appropri-

ate federal agency before raising them in court. See 28

U.S.C. § 2675. There is no evidence in the administrative

record that the appellants filed their tort claims with the

Air Force. Accordingly, the district court correctly con-

cluded that it lacked subject mat’«r jurisdiction over the

claims. See Meridian Int'l Logistics inc. v. United States, 939

F.2d 740, 743 (9th Cir.1991).

, AAR tS AP 8 ek OPN

App. 32

III. The district court erred in granting the Air Force's

motion for summary judgment.

The appellants argue that the decision to debar them

was arbitrary and capricious. They appeal the district

court’s summary judgment in favor of the Air Force on

three grounds: First, they argue that Carol Moore’s decla-

ration failed to establish that she had personal knowledge

regarding the contract proposal at issue and should have

been stricken from the administrative record. Second,

they claim that, by the terms of the 1994 novation of the

DoE contract, USI’s previous two years of government

contracting experience should have been “imputed” to

Samtech. Finally, they contend that they had a due pro-

cess right to an evidentiary hearing regarding Mirza Ali’s

role at Samtech. We address each of the appellants’ claims

in turn.

A. The district court properly rejected the appellants’

request to strike Carol Moore's affidavit.

The appellants claim that the Moore affidavit should

not have been admitted as evidence in the administrative

proceedings against them. They point out that the affi-

davit does not indicate to which specific contract pro-

posal it refers. On that basis, they argue that Moore failed

to establish her personal knowledge of the facts con-

tained in the affidavit and that the affidavit consequently

was incompetent.

As the district court recognized, the appellants’ posi-

tion is wholly without merit. The affidavit contains infor-

mation that clearly links it to the events in question. It

App. 33

refers in detail to Samtech’s proposal (the appellants do

not allege that they submitted more than one proposal to

the Air Force), the debarment of USI and Mirza Ali, and

Moore’s personal investigations of the matter. Moreover,

the facts in the affidavit comport with the administrative

record, which includes documentation indicating that

Moore was the contract specialist assigned to the pro-

posal in question. Since the appellants do not allege any

facts that call the reliability of the affidavit into question,

we agree with the district court that its use as evidence in

the administrative proceedings against the appellants

was neither arbitrary nor capricious.

B. The 1994 novation did not “impute” to appellants

USI's government contracting experience.

On February 13, 1994, following USI’s debarment,

USI, Sameena, and the DoE entered into a Novation

Agreement, transferring USI’s rights and obligations to

Sameena. The agreement states, in pertinent part:

The government recognizes the Transferee [Sam-

eena] as the Transferor’s [USI’s] successor in

interest in and to the contract. The Transferee by

this Agreement becomes entitled to all rights,

titles, and interests of the Transferor in and to

the contract as if the Transferee were the origi-

nal party to the contract.

The appellants claim that the terms of this Agree-

ment led them “reasonably” to believe that, because they

would be treated as the “original party” to the contract,

the Novation “imputed the DoE contract experience

entirely to Samtech.” As the district court noted, how-

ever, this claim is directly belied by the appellants’ earlier

App. 34

representations in their submission in response to the

proposed debarment, in which they contended that their

overstatement of government contracting experience had

resulted from an “innocent” error about the date of the

contract. In light of this inconsistency, the Air Force did

not act arbitrarily or capriciously in refusing to attach any

credibility to this claim.

C. The appellants were entitled to an evidentiary hear-

ing.

The Supreme Court has long recognized that a fed-

eral agency is obliged to abide by the regulations it

promulgates. See Vitarelli v. Seaton, 359 U.S. 535, 545, 79

S.Ct. 968, 3 L.Ed.2d 1012 (1959); Service v. Dulles, 354 U.S.

363, 372, 77 S.Ct. 1152, 1 L.Ed.2d 1403 (1957); Accardi v.

Shaughnessy, 347 U.S. 260, 267, 74 S.Ct. 499, 98 L.Ed. 681

(1954). An agency’s failure to follow its own regulations

“tends to cause unjust discrimination and deny adequate

notice” and consequently may result in a violation of an

individual’s constitutional right to due process. NLRB v.

Welcome-American Fertilizer Co., 443 F.2d 19, 20 (9th

Cir.1971); see also United States v. Newell, 578 F.2d 827, 834

(9th Cir.1978). Where a prescribed procedure is intended

to protect the interests of a party before the agency, “ever

though generous beyond the requirements that bind such

_ agency, that procedure must be scrupulously observed.”

Vitarelli, 359 U.S. at 547, 79 S.Ct. 968 (Frankfurter, J.,

concurring); see also Note, Violations by Agencies of Their

~ Own Regulations, 87 Harv. L.Rev. 629, 630 (1974) (observ-

ing that agency violations of regulations promulgated to

App. 35

provide parties with procedural safeguards generally

have been invalidated by courts).

The Federal Acquisition Regulation (“FAR”) estab-

lishes a system of uniform policies and procedures gov-

erning acquisitions by all executive agencies. See 48°C.F.R.

§ 1.101. In recognition of the “serious nature of debar-

ment,” see 48 C.F.R. § 9.402, the FAR sets out detailed

procedures to ensure that this sanction, which is intended

to safeguard the integrity of the acquisitions process,

itseif is applied in conformity with “principles of funda-

mental fairness.” 48 C.F.R. § 9.406-3(b). Accordingly, the

FAR provides:

[I]f it is found that the contractor’s submission

in opposition raises a genuine dispute over facts

material to the proposed debarment, agencies

shall also - (i) Afford the contractor an oppor-

tunity to appear with counsel, submit documen-

tary evidence, and confront any person the

agency presents.

48 C.F.R. § 9.406-3(b)(2). Thus, in the event of a genuine

factual dispute, the FAR clearly establishes that a contrac-

tor facing debarment is entitled to an evidentiary hearing.

The appellants claim that they raised a genuine issue

of material fact with regard to Mirza Ali’s position at

Sameena/Samtech. They contend that Ali was mistakenly

listed as Vice President of the company on the bank

signature card discovered by Moore and that the Febru-

ary 1996 letter from.the bank supports that centention..

Accordingly, they claim that they were entitled under the

FAR to an evidentiary hearing on the matter.

App. 36

The district court rejected the appellants’ claims on

two grounds. First, the court found the letter from the

bank to be inconclusive. The court pointed out that the

letter merely acknowledged that the bank had issued a

new signature card deleting Eqbal’s name, and that it had

made this “correction” after being informed that Zulfigqar

Eqbal was not a corporate officer. The district court sug-

gested that the letter had little probative value because it

was sent after debarment proceedings against the appel-

lants already had commenced.

Second, the district court observed that the operative

factual question informing the debarment decision was

not whether Ali/Eqbal was Vice President of Sameena/

Samtech but, rather, whether he exercised control over

the business. As the court noted, the Debarring Official

found that Ali had written business-related and personal

checks on Samtech’s account and had stated on the tele-

phone that he was project manager for government solic-

itations. Based on that evidence, the Debarring Official

concluded, “[{I]t is clear that Mr. Eqbal had full authority

to expend Samtech’s resources and bind the company.”

Because the district court found that “[n]othing plaintiffs

submitted created a dispute as to this issue,” it concluded

that they were not entitled to an evidentiary hearing.

The district court failed, however, to acknowledge

evidence submitted by the appellants that calls into ques-

tion whether Ali/Eqbal was a principal of Sameena/

Samtech. The appellants submitted evidence that Ali/

Eqbal was Vice President of a Hong Kong corporation

also called Samtech and that his position there had likely

caused the confusion involving the signature cards. The

appellants also submitted evidence indicating that Ali/

App. 37

Eqbal held no official position with Sameena/Samtech

other than bookkeeper and that the writing of checks was

consistent with that position. The appellants denied that

Ali/Eqbal had represented himself to be a project man-

ager or any other type of corporate officer. They

explained that the checks made out to and signed by

Eqbal were not for his personal use and were not issued

at his discretion. Finally, the appellants challenged the

government to produce any document indicating that

Ali/Egbal had actually acted in the capacity of a principal

with regard to control over the company’s decisionmak-

ing process. Thus, although the appellants’ submission

does not establish that the Debarring Official acted arbi-

trarily or capriciously in determining that Ali/Eqbal was

a principal of Samtech/Sameena, it does raise a genuine

factual dispute regarding the issue.

The appellants requested an evidentiary hearing to

address this question. The Debarring Official decided,

however, that a hearing was unwarranted, finding the

appellants’ denials of the charges against them to be

“unsupported by credible evidence.” We do not doubt

that the Air Force is in a better position than this Court to

assess the credibility of the evidence offered by the appel-

lants. We are convinced, however, that an evidentiary

hearing would have been the appropriate forum in which

to make such an assessment, particularly in view of the

serious consequences attaching to a debarment of 15

years. The FAR states unambiguously that such a hearing

“shall” be afforded if genuine: factual disputes arise.

Accordingly, we conclude that the Air Force violated the

appellants’ constitutional right to due process in failing

App. 38

to comply with binding regulations and that the appel-

lants are entitled to such a hearing on remand. As Justice

Frankfurter observed in a similar context, “He that takes

the procedural sword shall perish with that sword.”

Vitarelli, 359 U.S. at 547, 79 S.Ct. 968 (Frankfurter, J.,

concurring).

CONCLUSION

For the foregoing reasons, we AFFIRM the district

court’s dismissal of the appellants’ claims against the

individual defendants. However, we REVERSE the sum-

mary judgment in favor of the Air Force and REMAND to

the district court with instructions to remand this matter

to the Air Force. The Air Force should hold an evidenti-

ary hearing, pursuant to 48 C.F.R. § 9.406-3(b)(2), to

address whether Mirza Ali/Zulfiqar Eqbal was a princi-

pal of Sameena/Samtech.

. AFFIRMED in part, REVERSED in part and

REMANDED. Each party shall bear its own costs.

App. 39

NOT FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

UNITED STATES OF

AMERICA,

Plaintiff-Appellee,

No. 00-16165

DC No. CR 99-40002 CW

SAMEENA R. ALI, aka

Sameena Ikbal,

Defendant-Appellant.

chennai

UNITED STATES OF No. 00-10217

AMERICA, DC NO. CR 99-40002 CW

Plaintiff-Appellee, ORDER

Vv.

MIRZA ALI, aka Zulfigar

Eqbal, aka Henry Stone,

Defendant-Appellant.

(Filed Nov. 20, 2001)

ee ee ee ee ee ee ee ee ee ee ee”

Before: O’SCANNLAIN, TASHIMA, and THOMAS, Cir-

cuit Judges.

The panel has voted to deny the petition for panel

rehearing and for rehearing en banc.

The full court has been advised of the petition for

rehearing en banc and no judge of the court has

requested a vote on en banc rehearing. Fed. R. App. P.

35(b).

App. 40

The petition for panel rehearing and the petition for

rehearing en banc are denied.

App. 41

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

OAKLAND DIVISION

UNITED STATES OF

AMERICA,

PLAINTIFF,

VS.

MIRZA Z. ALI,

DEFENDANT.

NO. CR 98-40159 CW

UNITED STATES OF NO. CR 99-40002 CW

AMERICA,

VOLUME 8

PLAINTIFF, PAGES 1129-1305

VS. JURY TRIAL .

MIRZA Z. ALI, and

SAMEENA R. ALI,

DEFENDANTS.

ee ee ee ee ee ee ee ee ee ee, ee, ee ee

OAKLAND, CALIFORNIA

THURSDAY, SEPTEMBER 23, 1999

TRANSCRIPT OF PROCEEDINGS

BEFORE THE HONORABLE CLAUDIA WILKEN .

UNITED STATES DISTRICT COURT JUDGE AND JURY

* * +

App. 42

INSTRUCTIONS TO THE JURY

[8-1185] AT ISSUE IN THIS CASE IS WHETHER OR

NOT DEFENDANT MIRZA ALI, ALSO KNOWN AS

ZULFIQAR EQBAL, WAS A PRINCIPAL OF SAMEENA

INC. DOING BUSINESS AS SAMTECH RESEARCH AT

THE TIME CERTAIN STATEMENTS WERE MADE TO

AGENCIES OF THE UNITED STATES GOVERNMENT.

THIS IS FOR YOU TO DECIDE.

PRINCIPALS ARE OFFICERS, DIRECTORS,

OWNERS, PARTNERS [8-1186] OR PERSONS HAVING

PRIMARY MANAGEMENT OR SUPERVISORY RESPON-

SIBILITY WITHIN A BUSINESS ENTITY, E.G., GENERAL

MANAGER, PLANT MANAGER, HEAD OF — HEAD

OF A SUBSIDIARY, DIVISION OR BUSINESS SEGMENT,

AND SIMILAR POSITIONS.

* * *

App. 43

CLOSING ARGUMENT/LYONS

[8-1206] WELL, YOU’VE HEARD EXTENSIVE EVI-

DENCE — AND INCLUDING FROM SAMEENA ALI

HERSELF — ABOUT HOW SHE RAN THE WHOLE

COMPANY. SHE ADMINISTERED EVERYTHING. SHE

WAS THE ONE THAT WAS REALLY IN CHARGE.

* * *

[8-1292] AND, OF COURSE, IT’S OUR ARGUMENT

THAT HE — THAT WHAT MR. MIRZA ALI, ALSO

KNOWN AS ZULFIQAR EQBAL, ALSO KNOWN AS

HENRY STONE, WAS, THAT HE FELL WITHIN THAT

DEFINITION OF HAVING PRIMARY SUPERVISORY

RESPONSIBILITY, MANAGEMENT RESPONSIBILITY,

IN A WAY THAT IS SIMILAR TO-— AND HELD A

POSITION SIMILAR TO THOSE EXAMPLES GIVEN IN

THE DEFINITION. THAT’S FOR YOU TO DECIDE.

* * *

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.