1 richard marmaro (bar no. 91387) skadden, arps, slate

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GREGORY REYES’S RENEWED MOTION FOR A NEW TRIAL; ALTERNATIVE REQUEST FOR EVIDENTIARY HEARING AND WITNESS IMMUNITY; CASE NO. CR 06-00556 CRB

RICHARD MARMARO (Bar No. 91387) [email protected] JACK P. DICANIO (Bar No. 138782) [email protected] RONDA J. MCKAIG (Bar No. 216267) [email protected] SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 300 South Grand Avenue Los Angeles, California 90071-3144 Tel: (213) 687-5000 Fax: (213) 687-5600 CHRISTOPHER J. GUNTHER (admitted Pro Hac Vice) [email protected] 4 Times Square New York, New York 10036 Tel: (212) 735-3000 Fax: (212) 735-2000 Attorneys for Defendant Gregory L. Reyes

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN FRANCISCO DIVISION

UNITED STATES OF AMERICA,

Plaintiff,

v.

GREGORY L. REYES,

Defendant. 6) DECLARATION OF BARBARA KELLER; and 7) [PROPOSED] ORDER Hearing Date: January 9, 2008 Time: 2:15 pm Dept: Courtroom 8, 19th Floor Judge: Hon. Charles R. Breyer

Case No. CR 06-00556 CRB GREGORY L. REYES’S MOTION: 1) FOR A NEW TRIAL BASED ON NEWLY DISCOVERED EVIDENCE, PURSUANT TO RULE 33; OR ALTERNATIVELY 2) FOR AN EVIDENTIARY HEARING AND WITNESS IMMUNITY; MEMORANDUM OF POINTS AND AUTHORITIES; and FILED UNDER SEPARATE COVER 3) DECLARATION OF RONDA J. MCKAIG IN SUPPORT THEREOF; 4) DECLARATION OF JAMES HULBURD; 5) DECLARATION OF ANGELA RESTEPO-STEGER;

Case 3:06-cr-00556-CRB Document 746 Filed 12/07/2007 of 26

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1 GREGORY REYES’S RENEWED MOTION FOR A NEW TRIAL; ALTERNATIVE REQUEST FOR EVIDENTIARY HEARING

AND WITNESS IMMUNITY; CASE NO. CR 06-00556 CRB

TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:

PLEASE TAKE NOTICE that on January 9, 2008, at 2:15 p.m., or as soon thereafter as

the matter may be heard, in the above captioned Court, located at 450 Golden Gate Avenue, San

Francisco, California, defendant Gregory L. Reyes will, and hereby does move for a new trial on

the basis of newly discovered evidence pursuant to Federal Rule of Criminal Procedure 33, or

alternatively, for an evidentiary hearing and witness immunity. The Motion will be based on this

Notice of Motion and Motion, the Memorandum of Points and Authorities, the pleadings, records

and files in this action, all matters of which this Court may take judicial notice, and such other

documents and argument as may be presented at the hearing on this motion.

Dated: December 7, 2007 SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLPRichard Marmaro By: /s/ Richard Marmaro Richard Marmaro


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i GREGORY REYES’S RENEWED MOTION FOR A NEW TRIAL; ALTERNATIVE REQUEST FOR EVIDENTIARY HEARING


TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES .......................................................................................................... ii

MEMORANDUM OF POINTS AND AUTHORITIES .................................................................1

I. INTRODUCTION ...............................................................................................................1

II. FACTUAL BACKGROUND..............................................................................................4

A. Ms. Moore’s Testimony Was Material to the Trial .................................................5

B. Ms. Moore’s Testimony was Material to the Post-Trial Motions............................7

C. The Prosecution Learned of an Issue with Ms. Moore’s Testimony Prior to the Jensen Trial But Did Not Investigate It .............................................................8

D. Ms. Moore Confided to James Hulburd That Both She and Others in the Finance Department Were Aware of Retroactive Pricing .......................................9

E. Ms. Moore Confided to Angela Restrepo-Steger that She Felt Pressured to Give the Testimony She Gave and That if Mr. Bossi Told the Truth it Would “Change Everything” .................................................................................10

III. LEGAL ANALYSIS..........................................................................................................11

A. Legal Standards......................................................................................................11

B. Mr. Reyes is Entitled to a New Trial Because There is a Reasonable Probability That Ms. Moore’s Truthful Testimony Would Lead to an Acquittal.................................................................................................................12

1. The New Evidence is Material and There is a Reasonable Probability That It Would Lead to an Acquittal ........................................13

2. The Evidence Was Discovered After Mr. Reyes’s Trial and Defense Counsel Was Diligent in Discovering the New Evidence ...........15

3. Ms. Moore’s Admission is Not Merely Cumulative or Impeaching .........15

C. A New Trial is Required Even if Ms. Moore Did Not Actually Commit Perjury....................................................................................................................16

D. Failure to Grant a New Trial Would Constitute a Due Process Violation.............16

IV. AT A MINIMUM, MR. REYES SEEKS AN EVIDENTIARY HEARING AND WITNESS IMMUNITY SO THAT MS. MOORE CAN TESTIFY.................................18

A. An Evidentiary Hearing is Necessary to Evaluate Ms. Moore’s Testimony .........19

B. A Grant of Defense Witness Immunity is Necessary to Safeguard Mr. Reyes’s Due Process Rights...................................................................................19

V. CONCLUSION..................................................................................................................21


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ii GREGORY REYES’S RENEWED MOTION FOR A NEW TRIAL; ALTERNATIVE REQUEST FOR EVIDENTIARY HEARING


TABLE OF AUTHORITIES

Cases Page(s)

Curran v. Delaware, 259 F.2d 707 (3d Cir. 1958).............................................................................................. 17

Hall v. Director of Corrections, 343 F.3d 976 (9th Cir. 2003) ............................................................................................ 17

Hayes v. Brown, 399 F.3d 972 (9th Cir. 2005) ............................................................................................ 20

Killian v. Poole, 282 F.3d 1204 (9th Cir. 2002) .............................................................................. 13, 15, 17

Lindsey v. United States, 368 F.2d 633 (9th Cir. 1966) ............................................................................................ 15

Morris v. Ylst, 447 F.3d 735 (9th Cir. 2006), cert. denied, 127 S. Ct. 957 (2007)................................... 19

Sanders v. Sullivan, 863 F.2d 218 (2d Cir. 1988).............................................................................................. 17

United States v. Atkins, 545 F.2d 1153 (8th Cir. 1976) .......................................................................................... 19

United States v. Brutzman, 731 F.2d 1449 (9th Cir. 1984) .......................................................................................... 20

United States v. Camacho, 163 F. Supp. 2d 287 (S.D.N.Y. 2001)) ............................................................................. 19

United States v. Camacho, 188 F. Supp. 2d 429 (S.D.N.Y. 2002), overruled on other grounds, 353 F. Supp. 2d 524 (S.D.N.Y. 2005) ................................. 9

United States v. Chu, 5 F.3d 1244 (9th Cir. 1993) .............................................................................................. 20

United States v. Endicott, 869 F.2d 452 (9th Cir. 1989) ...................................................................................... 13, 15

United States v. Krasny, 607 F.2d 840 (9th Cir. 1979) ...................................................................................... 12, 13

United States v. Lord, 711 F.2d 887 (9th Cir. 1983) ............................................................................................ 20

United States v. Perkins, 138 F.3d 421 (D.C. Cir. 1998) .......................................................................................... 19

United States v. Walgren, 885 F.2d 1417 (9th Cir. 1989) .......................................................................................... 12

United States v. Westerdahl, 945 F.2d 1083 (9th Cir. 1991) .................................................................................... 20, 21

United States v. Young, 17 F.3d 1201 (9th Cir. 1994) .......................................................................... 13, 15, 16, 17


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iii GREGORY REYES’S RENEWED MOTION FOR A NEW TRIAL; ALTERNATIVE REQUEST FOR EVIDENTIARY HEARING


Statutes

Fed. R. Crim. P. 33(a) ........................................................................................................11-12, 16 Fed. R. Crim. P. 33(b)..............................................................................................................11-12 Fed. R. Crim. P. 33(b)(1) .............................................................................................................. 12 Fed. R. Evid. 804(b)(3) ............................................................................................................. 9, 10 Other Authorities

8A J. Moore, Moore’s Federal Practice § 33.04(1) (2d ed. 1978)................................................ 13


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MEMORANDUM OF POINTS AND AUTHORITIES

I. INTRODUCTION

This motion is brought as a result of information recently learned that the government’s

key witness has recanted her testimony from the first trial. The witness – Elizabeth Moore – was

the only finance department witness to testify for the prosecution. The prosecution used her

testimony as the linchpin of its closing argument that the finance department was deceived by

Mr. Reyes, telling the jury that “Our theory is that those people [in finance] didn’t know

anything. . . . Did you need everybody in the finance department to come and tell you that they

didn’t know?” (7/27/07 RT 4155:10-11, 20-21.) The prosecution staked its case on Ms. Moore’s

testimony and its argument that the finance department had been deceived, but as set forth more

fully in the declaration of James Hulburd, Ms. Moore now admits that the finance department

was not deceived, and that: (1) Ms. Moore was aware of Brocade’s retroactive pricing practices;

(2) other members of the finance department were aware of the retroactive pricing practices; and

(3) no one in the finance department believed that there was anything wrong with these

retroactive pricing practices. As Ms. Moore recently wrote in an email: "I've read the closing

argument over and over and I'm angry with Crudo [the prosecutor] twisting around what I said

and bullying me into saying something I didn’t intend to say. . . . I want to find a way to fix this,

my heart is heavy with guilt and want to fix this now."

Based on this new evidence, and the central role that Ms. Moore’s testimony played in

the prosecution’s conviction of Mr. Reyes, one cannot have confidence in the jury’s verdict, and

a new trial is required to prevent a miscarriage of justice. At a minimum, the Court should, in

the interest of justice, hold an evidentiary hearing and compel the prosecution to grant Ms.

Moore immunity for her testimony. Immunity is necessary because Ms. Moore’s new counsel

advised the prosecution, when it sought to interview her before Ms. Jensen’s trial, that Ms.

Moore would assert her Fifth Amendment privilege against self-incrimination as a result of her

testimony in the Reyes trial.

* * *

The indictment against Gregory Reyes alleged that he committed securities fraud by


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retroactively pricing option grants to employees of Brocade Communications Systems, Inc.

(“Brocade”) and then failing to properly account for those stock options in Brocade’s public

filings. At trial, Mr. Reyes’s principal defense was that Brocade’s finance department knew of,

authorized and approved the retroactive pricing practices. Defense counsel argued that Mr.

Reyes relied in good faith on the finance department’s accounting for option grants, and that no

one in the finance department ever advised Mr. Reyes that the company’s well-known method of

pricing employee stock options required Brocade to take a compensation charge or that the

retroactively priced options were not accounted for correctly on Brocade’s financial statements.

The prosecution presented the jury with the exact opposite argument – namely that Mr.

Reyes and Stephanie Jensen intentionally deceived Brocade’s CFO and the rest of the finance

department about the company’s option granting practices, and thereby caused the finance

department to unwittingly misstate Brocade’s financials. At the heart of the prosecution’s

argument that the finance department had been deceived was the testimony of Elizabeth Moore,

Brocade’s former stock administrator, and the sole member of Brocade’s finance department to

testify at trial. Despite the fact that (1) Ms. Moore was a relatively low-level employee in the

finance department; (2) the government had interviewed and placed on its witness list senior

finance department officers (including Brocade’s former CFOs and Controller); and (3) Ms.

Moore’s testimony seemed to contradict interview statements made by these finance officers and

emails presented at trial, the prosecution mentioned her testimony twenty-five times during its

closing argument and claimed that her purported ignorance of the company’s routine use of

retroactive pricing was clear proof that the entire finance department had been deceived.

The defense has now learned that Ms. Moore’s testimony – the centerpiece of the

prosecution’s theory that the finance department had been deceived – was false in critical

respects. Ms. Moore recently admitted to a confidant, James Hulburd, that she provided

untruthful testimony at Mr. Reyes’s trial. Specifically, Ms. Moore admitted that both she and

other members of the finance department were in fact aware of Brocade’s practice of

retroactively selecting grant dates. Ms. Moore explained that she did not provide this testimony

at trial because she was concerned about her job and felt pressured by the prosecutors. Ms.


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Moore also complained that her trial testimony had been mischaracterized by the prosecution in

its closing argument, and was used to create a misimpression that the finance department did not

know about Brocade’s retroactive option pricing practices. (See Declaration of James Hulburd,

filed concurrently herewith.)

Ms. Moore recently shared similar information with Angela Restrepo-Steger, Mr.

Reyes’s assistant. During telephone conversations with Ms. Restrepo-Steger, Ms. Moore stated

that she testified the way she did because she worked for Brocade and she was afraid, and felt

bullied by the prosecution. Ms. Moore told Ms. Restrepo-Steger that Michael Byrd, Brocade's

former CFO, and Bob Bossi, Brocade's former controller, knew what was going on at Brocade.

Ms. Moore exchanged emails with Ms. Restrepo-Steger wherein Ms. Moore reiterated these

statements. (See Declaration of Angela Restrepo-Steger, filed concurrently herewith.)1 In one

such email, Ms. Moore wrote: "What I really wish I could do is call Bob Bossi and tell him he

needs to come forward and tell the truth. His testimony could have changed everything."

(McKaig Decl., Ex. A) .

The accuracy of these declarations is corroborated by Ms. Moore’s refusal to testify in

the recently completed trial of Stephanie Jensen. In connection with the government's request to

interview Ms. Moore to prepare for the Jensen trial, Ms. Moore met with her original counsel,

Wilson, Sonsini, Goodrich & Rosati ("WSGR"). As a result of revelations by Ms. Moore

regarding her testimony at the Reyes trial, WSGR withdrew from representing Ms. Moore.

Shortly thereafter, she retained new counsel, George Niespolo. On November 13, 2007, the

prosecution sent an email to defense counsel stating that Mr. Niespolo had informed the

government that Ms. Moore would now assert her Fifth Amendment privilege in connection with

an interview scheduled to take place prior to the Jensen trial. The prosecution further informed

defense counsel that Ms. Moore’s assertion related to her prior testimony. In response,

counsel for Mr. Reyes wrote a letter to the prosecution requesting further investigation but the

prosecution has not responded to that request. The only reasonable inference from Ms. Moore’s

1 Ms. Moore has made similar statements -- i.e, that Bossi and Byrd knew about the retroactive pricing and that the prosecution twisted her testimony in their closing arguments – to at least two other witnesses: Barbara Keller and Linda Santambo. See, infra.


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retention of new counsel and her invocation of her Fifth Amendment rights is the one consistent

with her statements to Mr. Hulburd: that her testimony at the Jensen trial would have been

materially different from her testimony at the Reyes trial.

This newly discovered evidence – in particular, the fact that the finance department was

well aware of Brocade’s retroactive pricing practices – is wholly supportive of Mr. Reyes’s

defense, and wholly contradictory to the prosecution’s theory of the case. Significantly, there

was no evidence at trial that the finance department ever informed Mr. Reyes that retroactive

pricing of the sort routinely used at Brocade raised any issues about the way the company was

accounting for employee stock options. Nor was there any evidence that Mr. Reyes ever directed

anyone in the finance department not to account for the stock options properly. Consequently,

there can be little doubt that this new evidence of the finance department’s knowledge of

retroactive pricing – supporting the key defense argument and refuting a central prosecution

theme – would have put the case in an entirely different light before the jury. In any event, the

verdict should not be allowed to stand if there is any question that it might have turned, in any

respect, on false or materially inaccurate testimony, especially where that testimony was

evidently caused by perceived pressure from the prosecution. Accordingly, the Court should

grant Mr. Reyes a new trial, pursuant to Rule 33 of the Federal Rules of Criminal Procedure.

At a minimum, Mr. Reyes respectfully requests an evidentiary hearing and asks the Court

to instruct the prosecution to grant immunity to Ms. Moore so the Court can consider her

testimony. Failure to do so here, in light of the compelling evidence that Ms. Moore provided

false and misleading testimony on a key issue at trial, would lead to a serious miscarriage of

justice.

II. FACTUAL BACKGROUND

In August 2006, Greg Reyes was charged with securities fraud related to retroactively

pricing stock option grants to Brocade employees. The prosecution alleged that Mr. Reyes

concealed Brocade’s retroactive pricing practices from its finance department, which therefore

failed to properly account for the options in Brocade’s public filings.


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A. Ms. Moore’s Testimony Was Material to the Trial

Mr. Reyes’s trial began on June 18, 2007. At trial, defense counsel conceded that

numerous stock option grants to Brocade employees were priced retroactively in order to select

the best option prices. Mr. Reyes’s defense was that he relied upon Brocade’s finance

department, whose responsibility it was to properly account for the stock options, and who

authorized, approved of, and in any event was well aware of this granting practice. Defense

counsel’s opening statement repeatedly emphasized that core theme.2 The defense introduced

evidence that it was the finance department’s responsibility to ensure that the accounting

reflected in the company’s financial statements was accurate and that Mr. Reyes appropriately

relied on the finance department to properly account for employee stock options and to ensure

that the financial disclosures in Brocade’s public filings were accurate. (Bonderson: 7/9/07 RT

2299:19-2304:3; 2305:1-2306:6); (Neiman: 7/9/07 RT 2381:14-2382:14; 2386:1-9; 2389:9-13;

2381:14-2382:14); (Rinkle: 7/10/07 RT 2540:3-2543:4; 2543:16-21); (Macey: 7/10/07 RT

2706:15-23). The defense introduced evidence that Brocade’s retroactive pricing practices were

transparent to the finance department. (See, e.g., Trial Exs. 126, 144, 1590, 2014, 2017, 2041,

2043, 2044, 2045, 2051, 2067, 2070, 2078, 2080, 2083, 2085, 2086, 2089, 2099, 2103, 2248,

2405, 2431, 2468, 2526, 2527, 2534, 2536, 2539, 2573, 3227, 3332, 3377, 4626, 4728, 4729 and

4730.) And the prosecution produced no evidence that any member of the finance department

ever advised Mr. Reyes that those practices raised any question about whether the company’s

accounting for employee stock options was incorrect, let alone that Mr. Reyes ever directed

anyone in the finance department not to properly account for employee stock options.

Given this evidence and the clear thrust of defense counsel’s opening statement, the

prosecution was put on notice that Mr. Reyes’s defense was premised on the argument that the

2 See 6/18/07 RT 27:4-7 (“You will learn that Brocade’s finance department . . . was involved in creating and accounting for these stock option practices.”); id. at 37:22-38:2 (“You will hear that the stock option granting practices at Brocade were fully transparent, fully open to Brocade’s finance department, which was responsible for accounting for the stock options and disclosing them. In other words, the finance department knew what the human resources department was doing.”); id. at 57:8-10 (“And the key people in [the finance] department were aware of [the] practice of trying to give the employee the best price possible.”); id. at 67:1-3 (“. . . the finance department at Brocade was fully aware of the process that the human resource department was using to price stock options”). See also id. at 71-72.


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finance department knew the company was retroactively selecting stock option grant dates. In

response, the prosecution made every effort to prove the contrary. Knowing that Brocade’s

former controller (Robert Bossi) and former CFO (Michael Byrd) had both acknowledged their

awareness of retroactive pricing practices during immunized interviews with the government,3

the prosecution made the strategic decision to call Elizabeth Moore, Brocade’s stock

administrator, as its sole witness from the finance department. Ms. Moore spent nearly two days

on the witness stand and the prosecution elicited testimony from her that she and other members

of finance were unaware that grant dates were selected retroactively. (6/26/07 RT 1148:4-20.)

The prosecution then relied heavily on Ms. Moore’s testimony in its closing argument,

referencing her no fewer than 25 times. The prosecution repeatedly argued, based entirely on

Ms. Moore’s testimony, that the entire finance department had been deceived by Mr. Reyes, and

was unaware of the fact that stock option prices were selected retroactively. For example, the

prosecution argued that:

• Ms. Moore was unaware of the retroactive pricing practices. See 7/26/07 RT 3841: 21-22 (Moore “didn’t know that this scheme was going on. She was kept in the dark.”); see also id. 3878:17-19 (similar).

• Mr. Reyes and his co-conspirator took steps to make sure that only a few

people in the HR department knew about the retroactive pricing practices. See id. 3846:7-12 (“the defendant and Stephanie Jensen had to keep it quiet, basically had to keep the information within the people who worked on it as best they could.”) See also id. 3838:20-23 (similar).

• Mr. Reyes successfully concealed the retroactive pricing practices from the

Brocade finance department. See id. 3836:14-17 (Mr. Reyes granted options “without anyone knowing exactly what [he was] really doing.”).

• The finance department was misled by Mr. Reyes’s concealment of the

3 See FBI 302 Report of 7/12/06 Bossi interview, at 5 (“By [2003], BOSSI had a pretty good idea that backdating was going on.”); FBI 302 Report of 1/25/06 Bossi interview, at 1-2 (stating that Mr. Bossi told prosecutors that by 2001, he “had realized that backdating options grants was taking place regularly” (emphasis added); FBI Report of 7/13/07 Bossi Interview, at 1 (stating that Mr. Bossi believed it was “allowable to ‘look back’ within a fiscal quarter in the context of a committee of one.”); see also FBI 302 Report of 5/4/06 Byrd interview, at 14-15 (explaining that Byrd knew the option grant to Richard Geruson was backdated). Mr. Byrd’s awareness of retroactive pricing was also conceded by the SEC. In the complaint it filed against Byrd in August 2007, the SEC charged that Byrd knew that stock option awards to Geruson, Daniel Cudgma and Byrd himself were priced through look-backs. (Complaint, SEC v. Byrd, Case No. C 07-4223 WHA, at ¶¶ 26-32, 52, 56, 60.) Additionally, one of the prosecution’s witness – Margie Lee – testified that she told Mr. Byrd that she had retroactively selected a date for an option grant. (6/19/07 RT 406:8-409:1.)


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retroactive pricing practices. Id. 3854:2-17 (“Elizabeth Moore, Gary Blucher, Bob Bossi, they . . . don’t have any idea that a look-back is going on and that people are pretending that those meetings happened. . . . they assumed [] that something really did happen on that day. And that assumption . . . misleads them. It misleads them in the sense that they have the misunderstanding that the grant really happened on the day reflected in the grant minutes and that, therefore, there is no compensation expense.”)

• Ms. Moore’s testimony by itself established that the finance department did

not know about the retroactive pricing practices. See, e.g., id. 3842:24-3843:4 (“And the witnesses we called leave no doubt whatsoever about who is involved in that process and who knows and who doesn’t know about that process.”); 7/27/07 RT 4155:10-11, 20-21 (“Our theory is that those people [in finance] didn’t know anything. . . . Did you need everybody in the finance department to come and tell you that they didn’t know?”) (emphasis added).4

The prosecution’s argument had the desired effect. Mr. Reyes was convicted on August

7, 2007.

B. Ms. Moore’s Testimony was Material to the Post-Trial Motions

Following the verdict, the defense filed motions pursuant to Federal Rules of Criminal

Procedure 29 and 33 for a judgment of acquittal, or alternatively, for a new trial. In opposing the

motions, the prosecution emphasized that the finance department had been deceived by Mr.

Reyes. It contended that this position was supported by the fact that Ms. Moore did not know

from the face of the grant minutes that options had been priced retroactively. (Opp’n at 4:25-28;

see id. at 12:27-13:2 (“Elizabeth Moore, the only witness from the finance department with

accounting responsibilities to testify at trial, made it clear that she did not know about the routine

use of look-backs.”).

The Court, in its order denying the Rule 29 and Rule 33 motions, emphasized the

importance of the fact that Ms. Moore did not know about the retroactive pricing of options, and

articulated its belief that “the human resources department did not pass along information

about the scheme to people in the finance department like Elizabeth Moore.” (Order at

21:14-16 and 16:14-27) (emphasis added). Thus, Ms. Moore’s testimony played a significant

role in the trial, the post-trial motions, and in the court's opinion denying the motions.

4 The prosecution also presented a chart prominently featuring Ms. Moore’s name entitled “In the Know; Not in the Know” to argue that Ms. Moore and the finance department were unaware of the retroactive pricing practices. (See McKaig Decl. ¶ 5.)


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C. The Prosecution Learned of an Issue with Ms. Moore’s Testimony Prior to the Jensen Trial But Did Not Investigate It

Shortly before the Jensen trial, at which Ms. Moore was a scheduled government witness,

the prosecution arranged a pre-trial preparation meeting with Ms. Moore and her original

counsel, WSGR. In connection with preparing for that meeting, Ms. Moore apparently revealed

to Wilson Sonsini that her testimony in the Reyes trial was false. WSGR withdrew, and new

counsel, George Niespolo, was retained.

On November 13, 2007, Assistant United States Attorney Timothy Crudo sent an email

to Mr. Reyes’s counsel, Richard Marmaro, and Ms. Jensen’s counsel, Jan Little, which revealed

an issue concerning Ms. Moore’s trial testimony:

Please be informed that we have been notified by George Niespolo, counsel to Elizabeth Moore, that Ms. Moore will assert her Fifth Amendment privilege if called to testify at the Jensen trial. Mr. Niespolo did not share with us the grounds for that assertion, and he declined to tell us whether he considered the information Brady material as to either Mr. Reyes or Ms. Jensen. We asked Mr. Niespolo for further details, which he declined to provide except to add that the information was somehow related to her prior testimony.

(McKaig Decl. Ex. 1.) On November 16, 2007, counsel for Mr. Reyes wrote a letter to the

prosecution urging the United States Attorney’s Office to take additional steps to investigate

why, as a result of her prior testimony, Ms. Moore was now invoking her Fifth Amendment

rights. (Id. Ex. 2.) To date, defense counsel has not received a response from the prosecution,

and significantly, Ms. Moore was not called to testify in the Jensen trial. (Id. ¶ 3.) On December

6, 2007, prior to filing this motion, defense counsel sought to interview Ms. Moore and was

advised by Mr. Niespolo that she would not speak to counsel without immunity. (Id. Ex. 3.)

Since Ms. Moore is now unwilling to speak about these issues with Mr. Reyes's counsel absent a

grant of immunity from the government, this motion is based on the Declarations of James

Hulburd, Angela Restrepo-Steger, and Barbara Keller instead of a declaration directly from Ms.

Moore. (Id. ¶ 4.)


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D. Ms. Moore Confided to James Hulburd That Both She and Others in the Finance Department Were Aware of Retroactive Pricing

Mr. Reyes has been a client of Mr. Hulburd for approximately 12 years. Mr. Hulburd

provided financial services to Brocade employees and directors, first while employed at

Deutsche Bank Alex Brown as a managing director, and later while employed at Merrill Lynch

as a senior vice president. As a result, Mr. Hulburd spoke with Ms. Moore on a regular basis in

her capacity as Brocade’s stock administrator. While Ms. Moore is no longer employed by

Brocade, Mr. Hulburd has remained in contact with her. See Hulburd Decl. ¶¶ 1-5.

In late October 2007, Mr. Hulburd contacted defense counsel and informed them that he

had several conversations with Ms. Moore during which she confided in him that her testimony

during the trial was inaccurate.5 (McKaig Decl. ¶ 6.) Specifically, Mr. Hulburd relayed that Ms.

Moore had admitted to him that :

• She and others in Brocade’s finance department knew that Brocade looked back and picked favorable dates for employee stock option grants. (Hulburd Decl. ¶ 11.)

• The practice of retroactively selecting prices was done “out in the open” in the

finance department and “everybody knew of this practice.” (Id. ¶¶ 8, 11) • Those familiar with the practice of retroactively selecting prices did not refer to it

as “backdating,” nor did they believe there was anything wrong with looking back to select the most favorable prices for employees. (Id. ¶ 11)

• She was upset about the way the prosecution used her testimony to argue that the

finance department was deceived by Mr. Reyes. (Id. ¶ 10.) • She had not testified truthfully about her knowledge of the look-backs because

she was worried about losing her job and she felt pressured by federal prosecutors. (Id. ¶ 12.)

• She felt that she needed to correct the misimpression caused by her testimony.

(Id. ¶ 10.)

5 Ms. Moore’s statements to Mr. Hulburd fall squarely within an exception to the hearsay rule. See Fed. R. Evid. 804(b)(3). First, it is clear that Ms. Moore is an unavailable witness – she has not been granted immunity and her lawyer has informed the prosecution that she will assert her Fifth Amendment rights if called as a witness. Second, Ms. Moore’s statements are plainly against her own interest as they suggest that she was untruthful in her prior testimony. Because Ms. Moore is an unavailable declarant, and because her statements are against her own interest, the statements are not hearsay under Federal Rule of Evidence 804(b)(3). See United States v. Camacho, 188 F. Supp. 2d 429, 439 (S.D.N.Y. 2002) (hearsay statement admissible where the declarant was unavailable because he invoked the Fifth Amendment and his statements were against his penal interest), overturned on other grounds, 353 F. Supp. 2d 524 (S.D.N.Y. 2005).


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Ms. Moore’s statements to Mr. Hulburd establish that – contrary to the prosecution’s

argument and Ms. Moore’s trial testimony – Ms. Moore was aware that Brocade stock options

were priced retroactively, and she also knew that others in the finance department (including Mr.

Bossi and Mr. Byrd) were aware of the retroactive pricing. (Hulburd Decl. ¶¶ 8, 11.) It is

therefore clear that Mr. Reyes did not conceal the retroactive pricing practices from the finance

department, contrary to the prosecution’s arguments to the jury.

E. Ms. Moore Confided to Angela Restrepo-Steger that She Felt Pressured to Give the Testimony She Gave and That if Mr. Bossi Told the Truth it Would “Change Everything”

Ms. Restrepo-Steger is an assistant to the Reyes family. She came into contact with Ms.

Moore when Ms. Moore reached out to her in connection with her efforts to assist Mr. Reyes in

the collection of character letters to the Court for the Court’s consideration in Mr. Reyes’s

sentencing. (Restrepo-Steger Decl. ¶¶ 2, 3.)

During conversations with Ms. Restrepo-Steger, Ms. Moore said that Michael Byrd and

Bob Bossi knew what was going on at Brocade.6 Ms. Moore said that she was a lowly person in

the finance department but that Mr. Bossi knew and he could have come forward and said

something to make things right. Ms. Moore did not elaborate on what Mr. Bossi specifically

knew. (Id. ¶ 4.) Ms. Moore also told Ms. Restrepo-Steger that she was considering calling Mr.

Bossi and telling him that he should come forward and tell the truth. This statement was

reiterated in an email from Ms. Moore, wherein Ms. Moore stated:

What I really wish I could do is call Bob Bossi and tell him he needs to come forward and tell the truth. His testimony could have changed everything.

(Id., Ex. A.)

Ms. Moore also expressed that she testified the way she did because she worked for

Brocade and she was afraid. She mentioned that she felt bullied to testify the way that she did.

On October 24, 2007, Ms. Moore exchanged emails with Ms. Restrepo-Steger wherein Ms.

Moore specifically stated that the prosecutor bullied her into saying something she did not

6 For the reasons discussed in footnote 4, Ms. Moore’s statements to Ms. Restrepo-Steger also qualify for the hearsay exception under Federal Rule of Evidence 804(b)(3).


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intend. Ms. Moore wrote, “I’ve read the closing arguments over and over and I’m angry

with Crudo twisting around what I said, and bullying me into saying something I didn’t

intend to say.” (Id., Ex. B.)

Ms. Moore made similar statements to two friends and former co-workers from Brocade,

Barbara Keller and Linda Santambo, which echo in several key respects Ms. Moore's admissions

to Mr. Hulburd and Ms. Restrepo-Steger. Ms. Keller worked with Ms. Moore at Brocade, and

has known her for approximately seven years. According to Ms. Keller, Ms. Moore told her a

few weeks after the Reyes trial that she believed that the prosecution had twisted her testimony

and made it sound different than what she had meant to convey, and that she was very upset.

(Keller Decl., ¶ 4).

More recently, in November 2007, Ms. Keller spoke to Ms. Santambo, a current Brocade

employee who is also a friend of Ms. Moore. Ms. Santambo told Ms. Keller that Ms. Moore had

informed her that both Mr. Bossi and Mr. Byrd had known about Brocade's retroactive pricing

practices from the beginning. (Keller Decl., ¶ 5). Ms. Moore also told Ms. Santambo that she

was trying to come forward and do the right thing, but she feared that the prosecution would use

it against her if she did. (Id.)

* * *

Had a jury been informed of these truthful facts, it would inevitably have viewed the case

in a substantially different light. To allow the conviction to stand under these circumstances

constitutes a violation of Mr. Reyes’s due process rights. Accordingly, Mr. Reyes is entitled to a

new trial free from false evidence and false arguments, and including the newly discovered

evidence that Elizabeth Moore and Brocade’s finance department were aware of the retroactive

pricing practices.

III. LEGAL ANALYSIS

A. Legal Standards

Rule 33 provides that “the court may vacate any judgment and grant a new trial if the

interest of justice so requires,” and a new trial may be based on “newly discovered evidence”

which could not have discovered by reasonable diligence at the time of the trial. Fed. R. Crim.


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P. 33(a),(b). “Any motion for new trial grounded on newly discovered evidence must be filed

within 3 years after the verdict or finding of guilty.” Fed. R. Crim. P. 33(b)(1). Here, because

the verdict against Mr. Reyes was returned on August 7, 2007, Mr. Reyes’s motion is timely.

There are two standards governing motions for a new trial based on false or recanted

testimony. Where the prosecution knew or should have known that the testimony it sponsored

was false, a movant need only show “‘any reasonable likelihood’ that this evidence could have

affected the judgment of the jury.” See United States v. Walgren, 885 F. 2d 1417, 1427 (9th Cir.

1989) (citing United States. v. Agurs, 427 U.S. 97, 103 (1976)).7 Even if the prosecution could

not have known of the false testimony, a new trial is still required if there is “a reasonable

probability” that the newly discovered evidence would have led to a different outcome at trial.

United States v. Krasny, 607 F.2d 840, 843 (9th Cir. 1979).

B. Mr. Reyes is Entitled to a New Trial Because There is a Reasonable Probability That Ms. Moore’s Truthful Testimony Would Lead to an Acquittal

Absent evidence that the prosecution should have known the testimony it sponsored was

false, the Ninth Circuit has applied the following test when a motion for new trial is based on

false or recanted testimony: (1) the evidence relied on must have been discovered after the trial;

7 While Mr. Reyes satisfies the “reasonably probability” standard articulated in Krasny, here the Court should apply the less stringent standard applicable to situations where the prosecution knew or should have known that the testimony it sponsored was false because the prosecution possessed substantial evidence that the finance department was aware of the retroactive pricing practices. For example, both Mr. Bossi and Mr. Byrd provided immunized statements to the prosecution wherein both admitted that they were aware of retroactive pricing. Additionally, as the prosecution later admitted, the prosecution knew that its closing argument that Mr. Byrd had been deceived about the backdating of an option grant to Richard Geruson was wrong, because Mr. Byrd specifically admitted to the government that he was aware of the backdating of that particular option grant. See FBI 302 Report of 5/4/06 Byrd interview, at 14-15 (explaining that Byrd knew the option grant to Richard Geruson was backdated). The government’s knowledge of Mr. Byrd’s awareness of Brocade’s retroactive pricing practices was confirmed just after trial when the SEC filed a complaint against Mr. Byrd, charging him with knowledge of a number of retroactively priced option grants, and with knowingly providing substantial assistance in Brocade’s filing of false and misleading financial statements. (Complaint, SEC v. Byrd, Case No. C 07-4223 CRB, at ¶¶ 26-32, 52, 60.) Moreover, one of the prosecution’s own witnesses – Margie Lee – testified that she told Mr. Byrd that she had retroactively selected a date for an option grant. (6/19/07 RT 406:8-407:1.) This evidence taken as a whole, all within the prosecution’s possession in advance of trial, established that the finance department was well aware of retroactive pricing practices. As a result, even if the prosecution could credibly argue that it did not have actual knowledge of the falsity of Ms. Moore’s testimony about what she and others in the finance department knew about the retroactive pricing of option grants, the prosecution certainly should have known Ms. Moore’s statements were in fact false.


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(2) the movant must have been diligent in discovering the new evidence; (3) the new evidence

must not be merely cumulative or impeaching; (4) the new evidence must be material to the

issues involved; and (5) the new evidence must have a reasonable probability of resulting in a

different outcome at trial. United States v. Krasny, 607 F.2d 840, 843 (9th Cir. 1979).

Some courts have focused almost exclusively on the last factor (the reasonable

probability of a different outcome) in deciding whether to grant a new trial. See United States v.

Endicott, 869 F.2d 452, 455 (9th Cir. 1989) (absent the prosecution’s knowing use of perjury,

new evidence warrants a new trial if there is a “reasonable probability” that the evidence would

have altered the result of the proceedings); United States v. Young, 17 F.3d 1201, 1203-1204 (9th

Cir. 1994) (same); Killian v. Poole, 282 F.3d 1204, 1209-10 (9th Cir. 2002) (same). “A

‘reasonable probability’ is a probability sufficient to undermine confidence in the outcome.”

Endicott, 869 F.2d at 455 (citation omitted). When a key witness recants his or her testimony, or

the bulk of a key witness’ testimony is shown to be false, “a district court may well find it

probable that an acquittal would result on retrial.” Krasny, 607 F.2d at 845.

Mr. Reyes is entitled to a new trial here because there is at least a reasonable probability

that the new information provided by Ms. Moore would result in a different outcome at trial.8

1. The New Evidence is Material and There is a Reasonable Probability That It Would Lead to an Acquittal

Ms. Moore's erroneous and misleading testimony was material to the case, and there is a

strong probability that the jury would reach a different result if it had been excluded and her new,

truthful evidence were admitted.9 Mr. Reyes’s defense throughout the trial was that the finance

8 Mr. Reyes is arguably entitled to a judgment of acquittal, pursuant to Rule 29, rather than just a new trial, based on Ms. Moore's recanted testimony. As set forth above, the prosecution failed to present any evidence that anyone from the finance department ever told Mr. Reyes that the financial statements were incorrect. Thus, to prevail, the prosecution had to prove that the finance department was deceived. Other than Ms. Moore's testimony, however, the prosecution failed to present any evidence that finance was deceived. Thus, without Ms. Moore's erroneous and misleading testimony, no reasonable jury could have found that Mr. Reyes was guilty of securities fraud. 9 We analyze these factors together because materiality is necessarily a part of the determination of whether a different outcome would result. See 8A J. Moore, Moore’s Federal Practice § 33.04(1), at p. 33-27 (2d ed. 1978) (“Since the ultimate question is whether the new evidence ‘could have induced a reasonable doubt in the minds of enough jurors to avoid a conviction,’ it follows that the testimony of a principal government witness inherently possesses a high degree of materiality.”) (footnotes omitted).


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department knew about the backdating, that they were responsible for ensuring that Brocade’s

stock options were properly accounted for, that there was no evidence presented that they ever

told Mr. Reyes the options were being accounted for improperly, or that Mr. Reyes ever asked

them not to account for the options properly. The fact that the finance department was aware of

the backdating, yet never raised any concerns to Mr. Reyes about the way options were

accounted for on the financial statements, goes directly to Mr. Reyes’s good faith reliance on the

financial expertise of the finance department and constitutes a complete defense to the charges

against Mr. Reyes. There is every reason to think the outcome of a new trial would be different,

because (i) the prosecution would not have the one witness it used to undermine Mr. Reyes’s

primary defense at trial, and (ii) with a grant of immunity, the defense would instead have a new

witness to support its defense that the finance department was not deceived.

Ms. Moore was the prosecution’s only witness who testified about the finance

department’s lack of knowledge and her testimony was relied upon extensively in the

government’s closing arguments.10 Ms. Moore testified at trial that she and Controller Bob Bossi

reviewed option grant lists, and did not know that the decision to grant the options was made on

a date other the date on the grant list. (6/26/07 RT 1148:4-20). Ms. Moore also testified that she

“assumed” the date on the document was the date Mr. Reyes signed it. This language was

echoed in the prosecution’s closing argument: “Elizabeth Moore, Gary Blucher, Bob Bossi, they

. . . don’t have any idea that a look-back is going on and that people are pretending that those

meetings happened. . . . they assumed [] that something really did happen on that day. And that

assumption . . . misleads them. It misleads them in the sense that they have the

misunderstanding that the grant really happened on the day reflected in the grant minutes and

that, therefore, there is no compensation expense.” (7/26/07 RT 3854:2-17) (emphasis added).

In truth, as Ms. Moore told Mr. Hulburd, she did not assume anything about the dates on

the documents. She did not care when Mr. Reyes actually signed them. (Hulburd Decl. ¶ 9.)

Why would she have? She and others in the finance department knew that Brocade looked back

and picked favorable prices for some employee stock options, and neither she nor anyone else at

10 The Court also relied extensively on Ms. Moore's testimony that she – and by extension the finance department – was deceived in denying Mr. Reyes’s initial new trial motion. (See Order at 21:14-16 and 16:14-27).


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Brocade thought there was anything wrong with that. (Id. ¶ 11.)

Because the new evidence from Ms. Moore wholly supports Mr. Reyes’s defense theory

and fatally undercuts the prosecution’s theory of the case against Mr. Reyes, there is more than a

reasonable probability that, had the new, truthful evidence been disclosed to the jury, the result

of the proceedings would have been different. Viewed objectively, Ms. Moore’s recantation and

correction of her testimony seriously undermines confidence in the jury’s verdict. See, e.g.,

Endicott, 869 F. 2d at 455; Young, 17 F. 3d at 1203-04; Killian, 282 F. 3d at 1209-1210.

2. The Evidence Was Discovered After Mr. Reyes’s Trial and Defense Counsel Was Diligent in Discovering the New Evidence

The new information recently admitted by Ms. Moore was not available during Mr.

Reyes’s first trial, and no further diligence on Mr. Reyes’s part could have brought it to light.

Only Ms. Moore’s own conscience and feelings of remorse brought these issues forward after

Mr. Reyes’s conviction in August 2007. As described in the Hulburd Declaration, Ms. Moore

was shocked over Mr. Reyes’s conviction and the prosecution’s use of her testimony to obtain

the conviction. (Hulburd Decl. ¶ 7.) It was these feelings that prompted her to reach out to Mr.

Hulburd and others, and tell them the truth — i.e., that she had provided inaccurate testimony on

the stand and left a false impression that the prosecution exploited to its advantage. Ms. Moore

did more than talk to Mr. Hulburd about her feelings of remorse and guilt; she intended to draft a

letter to the Court for the purpose of identifying the inaccuracies in the prosecution’s closing

argument. (Id. ¶ 10.)

3. Ms. Moore’s Admission is Not Merely Cumulative or Impeaching

Ms. Moore’s new, accurate testimony is not cumulative or merely impeaching; she was

the sole witness at trial who testified about finance’s knowledge, an issue of fact that was critical

to the charges against Mr. Reyes and heavily contested at trial. “An unrepudiated recantation of

trial testimony is not merely impeaching, but is substantial and material evidence . . . because the

new version will presumably be testified to at the new trial.” Lindsey v. United States, 368 F.2d

633, 636 (9th Cir. 1966). Ms. Moore’s new, accurate testimony would shed significant light on a

key factual issue were the government to seek to retry Mr. Reyes.


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C. A New Trial is Required Even if Ms. Moore Did Not Actually Commit Perjury

There is no requirement that the witness have actually committed perjury; mistaken

testimony is sufficient. In Young, a government witness (a police officer) testified that

incriminating notebooks recording information related to methamphetamine production and sale,

were found taped under the dashboard of the defendant’s truck. Young, 17 F.3d at 1203-1204.

After the defendant’s conviction, the police officer who had searched the defendant’s truck said

that the notebooks had actually been found in a bag in the cab of the truck, not taped under the

dashboard. This revised information, which was inconsistent with the prosecution’s theory of

the case, reduced the amount of incriminating evidence against the defendant and corroborated

the defense theory. Id. at 1202-03. The Ninth Circuit held that in light of the entire record, there

was a reasonable probability that the result would have been different had the prosecution not

presented the witness’s false testimony. The defendant was therefore entitled to a new trial

regardless of whether the witness actually committed perjury or was simply mistaken. Id. at

1204.

Moreover, the Young Court determined that if the jury found the defendant was lying

about one fact, it was much more likely to believe that he was lying about others, and thus guilty.

Similarly here, Elizabeth Moore’s false testimony seriously undermined Mr. Reyes’s defense.

Her testimony surely affected the jury’s judgment of whether Mr. Reyes’s defense was

believable or not. Certainly the prosecution emphasized it repeatedly in closing argument for the

precise purpose of casting doubt on the defense’s theory of the case. And, as the Young Court

explained, if the jury found the defense lacking in credibility on the question of the finance

department’s knowledge, it was likely to discount the defense position on other issues as well.

Given the importance of Ms. Moore’s testimony to this trial, her trustworthy recantation

warrants a new trial and to allow the conviction to stand would constitute a violation of Mr.

Reyes’s due process rights. Accordingly, a new trial is “required in the interest of justice.” Fed.

R. Crim. P. 33(a).

D. Failure to Grant a New Trial Would Constitute a Due Process Violation

Mr. Reyes's request for a new trial is not only warranted by Rule 33. A failure to grant


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such a new trial here would violate due process. “[A] state’s failure to act to cure a conviction

founded on a credible recantation by an important and principal witness, exhibits sufficient state

action to constitute a due process violation.” Sanders v. Sullivan, 863 F. 2d 218, 224 (2d Cir.

1988) (case remanded to district court to determine the credibility of witness’s recantation, and if

recantation is credible, to apply the appropriate standard to the new trial motion).11

In Sanders, the Second Circuit explained that a new trial is warranted “when a credible

recantation of the testimony in question would most likely change the outcome of the trial and a

state leaves the conviction in place.” Sanders, 863 F.2d at 222. “Constitutional error occurs . . .

if the evidence is material in the sense that its suppression undermines confidence in the outcome

of the trial.” Id. In Sanders, the defendant was convicted of manslaughter related to a shooting.

While the defendant and the witness were both in jail, the witness expressed remorse about what

he had said during the trial, recanted his testimony that the defendant had committed the crime,

and said that his now-dead wife had actually shot the victim. Id. at 219-220. In analyzing the

issue, the Second Circuit relied on Curran v. Delaware, 259 F. 2d 707, 713 (3d Cir. 1958), where

the court held that although the prosecution had no knowledge of the perjury when the witness

was on the stand, the testimony’s potential prejudicial effect on the jury “cause[d] the

defendant’s trial to pass the line of tolerable imperfection and fall into the field of fundamental

unfairness.” Sanders, 863 F. 2d at 223 (alteration in original); see also, Hall v. Director of

Corrections, 343 F. 3d 976, 981 (9th Cir. 2003) (Defendant did not argue that the prosecution

knew the evidence was false at the time it was admitted into evidence, but “to allow his

conviction to stand, based on the present knowledge that the evidence was falsified, is a violation

of his right to due process under the Fourteenth Amendment.”).

So it is here. Elizabeth Moore’s testimony that the finance department did not know

about the backdating of stock options had a prejudicial effect on the jury. As argued above, it

was the only testimony in support of the prosecution’s theory that Mr. Reyes was trying to hide

11 See also United States v. Young, 17 F. 3d 1201, 1203-1204 (9th Cir. 1994) (“A conviction based in part on false evidence, even false evidence presented in good faith, hardly comports with fundamental fairness. Thus, even if the government unwittingly presents false evidence, a defendant is entitled to a new trial ‘if there is a reasonable probability that [without the evidence] the result of the proceeding would have been different.’”) (citations omitted); Killian v. Poole, 282 F.3d 1204, 1209-10 (9th Cir. 2002) (witness recanted his testimony and new trial motion


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his actions from the finance department at Brocade. Throughout its opening and closing

statements, the prosecution argued that only Mr. Reyes, Ms. Jensen and a handful of Human

Resources employees knew about the backdating, and that Mr. Reyes and Ms. Jensen actively

concealed the practice from the rest of the company. The conspiracy itself was defined as a

secret agreement between Ms. Jensen and Mr. Reyes, and the securities fraud was described to

the jury as Mr. Reyes’s effort to secretly alter the financial statements of the company. In its

closing, the prosecution went so far as to argue that Ms. Moore testified that finance didn’t

know, and asked rhetorically whether the jury really needed every member of the finance

department to come in and tell them the same thing.

If, as Ms. Moore now admits, the finance department knew how option grants were

priced and dated, then the government would have to include those individuals within its

description of the conspiracy and would have to dramatically alter its theory of fraud. The case

presented to the jury would have been entirely different. Instead of being able to argue that Mr.

Reyes, Ms. Jensen and a handful of Human Resources employees knew about the backdating and

successfully kept it quiet, the government would have to argue that not only did HR know, but

finance, the department responsible for accurately accounting for Brocade’s financial statements,

knew as well. Importantly, there was no evidence presented during the trial establishing that Mr.

Reyes ever asked a member of the finance department to incorrectly account for the stock

options, or alternatively, that the finance department was actively concealing the incorrect

accounting from the auditors. Thus, Mr. Reyes’s conviction was undoubtedly premised, at least

in large part, on false testimony that cuts to the very heart of the allegedly criminal conduct, and

accordingly, it would be fundamentally unfair to allow his conviction to stand.

IV. AT A MINIMUM, MR. REYES SEEKS AN EVIDENTIARY HEARING AND WITNESS IMMUNITY SO THAT MS. MOORE CAN TESTIFY

At a minimum, the Court should conduct an evidentiary hearing to further explore the

issues raised in this motion. In that event, Mr. Reyes also seeks witness immunity for Ms.

Moore so that she can testify freely as to the true facts surrounding the finance department’s

knowledge of retroactive pricing practices, the truthfulness of her prior testimony, and the full

________________________ (cont'd from previous page) was granted even if the prosecution was unaware the testimony was false when given).


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circumstances that led to her previous testimony.

A. An Evidentiary Hearing is Necessary to Evaluate Ms. Moore’s Testimony

Evidentiary hearings are often held when a new trial is predicated on an affidavit related

to recanted trial testimony. See e.g. United States v. Atkins, 545 F.2d 1153, 1154 (8th Cir. 1976)

(evidentiary hearing held where a key government witness recanted his trial testimony); see also

United States v. Camacho, 163 F. Supp. 2d 287, 313-314 (S.D.N.Y. 2001) (evidentiary hearing

necessary where a witness who did not testify at trial provided an affidavit containing

exculpatory evidence); United States v. Perkins, 138 F.3d 421, 423 (D.C. Cir. 1998) (witness

called to testify at evidentiary hearing about recantation of trial testimony). In light of the

significant questions raised by the Hulburd Declaration and the clear indication that Mr. Reyes

did not receive a fair trial, an evidentiary hearing is required here.

B. A Grant of Defense Witness Immunity is Necessary to Safeguard Mr. Reyes’s Due Process Rights

Defense counsel anticipates that Ms. Moore would assert her Fifth Amendment rights if

called to testify at an evidentiary hearing related to her recantation because her counsel has

already advised the government that she would invoke her Fifth Amendment rights in connection

with the Jensen trial. If Ms. Moore invokes her Fifth Amendment rights as anticipated, we ask

that the government grant her immunity because the prosecution has an obligation to seek the

truth and to ensure that any conviction is not based on false testimony. The truth-seeking

function of the trial process “cannot be fulfilled when the state, knowing that a witness may have

perjured herself, proceeds without conducting an investigation to ensure that a new trial is not

warranted.” Morris v. Ylst, 447 F.3d 735, 744 (9th Cir. 2006), cert. denied, 127 S. Ct. 957

(2007)). “‘A prosecutor cannot avoid this obligation [to seek the truth] by refusing to search for

the truth and remaining willfully ignorant of the facts.’” Id. (quoting N. Mariana Islands v.

Bowie, 243 F.3d 1109, 1118 (9th Cir. 2001)).12 Thus, the prosecution should support Mr.

Reyes’s request for an evidentiary hearing and witness immunity because along with their power

12 “The duty to investigate flows from the ‘constitutional obligation of the State and its representatives to collect potentially exculpatory evidence, to prevent fraud upon the court, and to elicit the truth.’” Morris, 447 F.3d at 744 (quoting Bowie, 243 F.3d at 1117).


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to seek sanctions, prosecutors carry a profound responsibility to seek justice above all. See, e.g.,

Hayes v. Brown, 399 F.3d 972, 978 (9th Cir. 2005) (“‘The prosecuting attorney represents a

sovereign whose obligation is to govern impartially and whose interest in a particular case is not

necessarily to win, but to do justice’”) (citation omitted); United States v. Chu, 5 F.3d 1244,

1249 (9th Cir. 1993) (“‘A prosecutor has the responsibility of a minister of justice and not simply

that of an advocate.’”) (citation omitted).

If the government refuses to grant her immunity, we ask that the Court compel the

government to grant Ms. Moore witness use immunity. While the granting of immunity is

generally an executive power and function, the somewhat unusual facts presented here justify the

Court in compelling the prosecution to immunize Ms. Moore. The Ninth Circuit has suggested

that a district court should compel the government to grant use immunity to defense witnesses in

certain circumstances. See United States v. Westerdahl, 945 F.2d 1083, 1086 (9th Cir. 1991)

(holding that a defendant’s witnesses should be immunized “where the fact-finding process is

intentionally distorted by prosecutorial misconduct and the defendant is thereby denied a fair

trial” (citing United States v. Lord, 711 F.2d 887, 892 (9th Cir. 1983)). In the event the

government refuses to grant such immunity, the Court should exercise its power to dismiss the

prosecution and grant a judgment of acquittal for Mr. Reyes. See Lord, 711 F.2d at 891-92

(citing Virgin Islands v. Smith, 615 F.2d 964 (3d Cir. 1980)).

The present situation is similar to the situation where a prosecutor grants immunity to one

witness but denies immunity to another whose testimony would directly contradict the

government’s theory. In such instances, immunity for the witness who would contradict the

government’s theory is warranted to preserve the defendant’s due process rights. See, e.g.,

Westerdahl, 945 F. 2d at 1087 (9th Cir. 1991) (“For the government to grant immunity to a

witness in order to obtain his testimony, while denying immunity to a defense witness whose

testimony would directly contradict that of the government witness, is the type of fact-finding

distortion we intended to prevent in Lord.”); see also United States v. Brutzman, 731 F.2d 1449,

1452 (9th Cir. 1984) (suggesting that it would be an abuse of due process for government to seek

and obtain immunity for its own witnesses while refusing to request immunity for defendants'


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eyewitnesses). Here, the prosecution secured grants of immunity for a number of witnesses in

the Reyes trial. Now, Ms. Moore can provide testimony in support of Mr. Reyes’s motion for

new trial that undercuts her trial testimony and completely undermines the government’s theory

at trial. This is precisely the situation contemplated by the Westerdahl court, which held that it

was unfair to allow the government to grant immunity in a self-serving manner only to withhold

immunity from witnesses who could provide truthful testimony to exculpate the defendant. Such

conduct is an intentional distortion of the fact-finding process, and in such circumstances, the

Court should compel the government to grant immunity (or else face a reversal of Mr. Reyes's

conviction and the granting of a judgment of acquittal) because the government is denying Mr.

Reyes a fair trial and thwarting Ms. Moore’s ability to provide truthful testimony simply because

it contradicts the government’s theory. See Westerdahl, 945 F. 2d at 1086-1087.

V. CONCLUSION

Respectfully, we urge the Court to prevent a miscarriage of justice. For the foregoing

reasons, Mr. Reyes requests that his motion for a new trial be granted, or alternatively, that the

Court order an evidentiary hearing and witness immunity for Ms. Moore.

Dated: December 7, 2007 SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLPRichard Marmaro

By: /s/ Richard Marmaro Richard Marmaro


1 richard marmaro (bar no. 91387) skadden, arps, slate

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