fr-l'? CASE Document 1 Filed 12/14/16 Page 1 of 36 UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA I. A an UNITED STATES OF AMERICA, INDICTMENT . Plaintiff, 18 U.S.C. 1349 . 18 use. 1341 v. 18 U.S.C. 1343 18 U.S.C. 195601) 18 U.S.C. 371 18 U.S.C- 2 - . PAUL R. HANSMEIER and JOHN L. STEELE, Defendants. THE UNITED STATES GRAND JURY CHARGES: OVERVIEW 1. Between 2011 and 2014, defendants Paul R. HANSMEIER and John L. STEELE orchestrated an elaborate scheme to fraudulently obtain millions of dollars in copyright lawsuit settlements by deceiving state and federal courts throughout the country. In order to carry out the scheme, the defendants used sham entities to obtain copyrights to pornographic movies?some of which they ?lmed themselves?and then uploaded those movies to ?le-sharing websites in order to lure people to download the movies. To learn the identities of the people caught in the trap they constructed, HANSMEIER and STEELE ?led specious cepyright infringement lawsuits and fraudulently procured permission from courts to send subpoenas to internet service providers for subscriber information associated with the IP addresses used to download their pornographic movies. After receiving this information, the defendants?through extortionate letters and phone calls?threatened the subscribers with enormous ?nancial penalties and public embarrassment unless the SCANNED Etc '1 1 2015 CASE Document 1 Filed 12/14/16 Page 2 0f 36 U.S. v. Paul Hansmeier et 31. subscribers agreed to pay a settlement, allthe while concealing their collusion in the alleged copyright infringement. When courts restricted their ability to sue multiple individuals in the same lawsuit, the defendants shifted tactics. They ?led lawsuits falsely alleging that computer systems purportedly belonging to their sham clients had been in?ltrated by hackers, and then recruited ruse defendants against Whom they brought these illusory i ?hacking? lawsuits. Finally, when courts became suspicious of the defendants? tactics and motives, the defendants began a long process of lies and deceit designed to conceal the truth and de?ect responsibility from themselves. Ir In total, the defendants obtained - approximately. $6,000,000 made possible by the fraudulent copyright lawsuits they peddled to comts throughout the country. 1 INTRODUCTION At times relevant to this Indictment: 2. Defendant Paul R. HAN SMEIER was an attorney licensed to practice law in the State of Minnesota. . 3. Defendant John L. STEELE was an attorney licensed to practice law in the State of Illinois. 4. Under both the Minnesota and A Illinois rules of professional conduct governing attorneys, HANSMEIER and STEELE owed a duty of ?candor? to the court not to make false statements or cause false statements to be made to any court, and to correct any false statements that had already been made. In an ex parte proceeding?where only 2 CASE Document 1 Filed 12/14/16 Page 3 Of 36 US. v. Paul Hansmeier et 31. one of the parties to a lawsuit are communiCating with a and I STEELE were obligated to advise the court of all material facts, whether or not the facts were adverse to their position. i 5. a lawsuit, parties generally participate in a ?discovery? process whereby ?they are able to obtain potentially relevant information and documents from the opposing party as well as third parties. Under certain circumstances, a party to a lawsuit may be able to obtain ?early? discovery?before it would normally be available to the party?- throu-gh an ex parte proceeding inorder to obtain evidence necessary to allow the lawsuit to proceed, such as the identity of the opposing party. If the evidence is in the possession of a third party, the person seeking early discovery must obtain permission from the court to send a ?subpoena? to the third party, which compels the third party to turn over the evidence. BitTorrent 6. ?BitTorrent websites, including a website named the Pirate Bay, allow users to share movies or other copyrighted ?les with one another without paying any fees to the copyright holder. Many BitTorrent websites store their servers in foreign countries, allow users to participate anonymously (only requiring a user- generated screen-name), and take other measures to cloak the activities taking place on the website. i 7. Under the ?BitTorrent? protocol, an initial ?seeder? uses BitTorrent software to divide a video (or other file) into small pieces and creates a ?torrent? file, which contains 3 CASE Document 1 Filed 12/14/16 Page 4 of 36 US. v. Paul Hansmeier et metadata about the ?le and about the computer! server that coordinates distribution of the ?le, which is referred to as the ?tracker.? The ?seeder? then uploads the torrent ?le to a ?le-sharing website such as Pirate Bay, and makes the partitioned video available to other I users. Individuals-interested in obtaining the video?referred to as ?peers? or ?users?? ?rst download the torrent ?le from the ?le?sharing website and open the torrent file with BitTorrent' software on their computers. Upon opening the torrent ?le, BitTorrent software contacts the tracker to ?nd out what computers are online, and then seeks individual pieces of the videoifrorn' those other camputers. "Initially, the 'pieces?will? be downloaded by peers directly from the seeder, but as more peers obtain pieces of the video, they will share those pieces 'with one another. Thus, the ?seeder? does not actually ?upload? the video to a website, but rather uploads a torrent ?le that makes it possible for individuals to obtain the video. from the seeder and others; Defendants Entities and Associates 8. Steele Hansmeier PLLC was a law ?rm controlled and operated by defendants HANSMEIER and STEELE. Beginning no later than in or about 2010 and continuing at least until in or about November 2011, the defendants utilized Steele Hansmeier PLLC to bring copyright infringement lawsuits on behalf of purported clients. 9. Prenda Law Inc. was a law firm nominally owned by an Illinois lawyer named P.D., but was in fact substantially controlled and beneficially-owned by defendants HANSMEIER and STEELE. Beginning in or about November 201 1, and continuing until 4 CASE Document ?1 _7 Filed 12/14/16 Page 5 Of 36 US. v. Paul Hansmeier et a1. 2013, defendants HANSMEIER and STEELE used Prenda Law to cause copyright infringement lawsuits to be ?led and collect settlements on behalf of purported clients. 10. Anti~Piraciy Law Group was a law ?rm nominally owned by P.D., but in fact substantially controlled and bene?cially owned by defendants HANSMEIER and STEELE. In or about 20l3, defendants HANSMEIER and STEELE used Anti-Piracy Law Group to cause copyright infringement lawsuits to be ?led and collect settlements on behalf of purported clients. 11. ML. worked for HANSMEIER and MEL. was paid a salary at various times by Steele Hansmeier PLLC and Prenda Law. M.L. generally worked as a paralegal whose duties included making phone calls and sending letters to purported copyright infringers threatening legal action unless they paid a settlement fee; worked in of?ces located in Chicago, Las Vegas, and Miami with STEELE, and generally took direction from STEELE. I i 12. P.H. worked for HANSMEIER and STEELE. P.H. at times received payment from the defendants through entities named Media Copyright Group and 6881 Forensics. P.H. generally worked as a computer forensic consultant who monitored BitTorrent ?le-sharing websites and attempted to track addresses that downloaded or attempted to download certain pornographic movies associated with purported clients of Steele Hansmeier PLLC, Prenda Law, and Anti-Piracy Law Group. P.H. also assisted in the preparation of legal documents, such as af?davits supporting requests for early 5 CASE Document 1 Filed 12/14/16 Page 6 of 36 US. v. Paul Hansmeier et al. discovery for copyright infringement lawsuits ?led by Steele Hansmeier PLLC, Prenda Law, Anti?Piracy Law Group, and their purported clients. P.H. worked in multiple of?ces located in Minneapolis with HANSMEIER, and generally took direction from HANSMEIER. . 13. AF Holdings LLC and Ingenuity 13 LLC were entities that HANSMEIER and STEELE caused to be founded under the laws of St. Kitts and Nevis, an island country located in the Caribbean Sea. AF Holdings and Ingenuity 13 were purportedly owned by 'a trust managed by and bene?tting HANSMEIER were the defacto owners of AF Holdings and Ingenuity l3. HANSMEIER and STEELE used AF Holdings and Ingenuity 13 as sham clients that purportedly owned copyrights to pornographic movies or operated computer systems associated with pornographic movies, but which the defendants in fact owned and controlledr themselves. 14. Guava LLC, Livewire Holdings LLC, and LW Systems LLC were US.- based entities that HANSMEIER and STEELE caused to be created. Guava, Livewire, and LW Systems were purportedly owned and/or controlled by but HAN SMEIER and STEELE were the de?zcto owners of the entities. MNSNIEIER and STEELE used Guava, Livewire, and LW Systems as sham clients that purportedly owned copyrights to pornographic movies or operated computer systems associated with pornographic movies, but which they in fact owned and controlled themselves. CASE Document 1 Filed 12/14/16 Page 7 of 36 US. v. Paul Hansmeier et a1. COUNT 1 (Conspiracy to Commit Mail Fraud and Wire Fraud) 18 U.S.C. 1349 15. The allegations Contained in paragraphs 1 through 14 of this Indictment are re-alleged as if stated in full herein. 1 16. Beginning no later than in or about 2011 and continuing at least until in or about 2014, in the State and District of Minnesota and elsewhere, the defendants, PAUL R. HANSNIEIER and JOHN L. STEELE, did knowingly conspire. with each other and with others to devise and? participate in a scheme and arti?ce to defraud and to obtain money and property by means of materially false and fraudulent pretenses, representations, promises, and material omissions, and for the purpose of executing such scheme and arti?ce, and attempting to do so: cauSed the sending, delivering and receipt of various matters and things by United States Postal Service and private and commercial interstate carrier; and caused the transmission in interstate commerce, by means of wire communications, of certain writings, signs, signals, pictures and sounds. i 17. More speci?cally, beginning at least as early as 2011, and continuing until in or about 1:20 14, Paul HAN SNEEIER and John STEELE executed a scheme to fraudulently obtain millions of dollars in copyright lawsuit settlements by deceiving state and federal courts throughout the country. HANSMEIER and lawyers?used sham CASE Document 1 Filed 12/14/16 Page 8 0f 36 U.S. v. Paul Hansmeicr et al. entities they controlled to obtain copyrights to pornographic movies, some of which they ?lmed themselves. The defendants then uploaded themovies to ?le-sharing websites hoping to lure peeple into downloading their movies. When HANSMEIER and STEELE ensnared someone in their trap, they ?led false and deceptive cepyright infringement lawsuits that concealed their role in distributing the movies, as well as their signi?cant personal stake in the outcome of the litigation. II A?er coercing courts into giving them the pewer to subpoena internet service providers and thereby identify the subscriber who controlled the IP address used to down10ad the movie, the'defendants used extertionate tactics to garner quick settlements from individuals who were unaware of the defendants? role in uploading the movie, and often were either too embarrassed or could not afford to defend themselves. When these individualsdid ?ght back, the defendants dismissed the lawsuits rather than risk their scheme being unearthed. After courts began limiting the number of people that HANSMEIER and STEELE could sue in one lawsuit, they changed tactics and began ?ling lawsuits falser alleging that computer systems belonging to certain of their sham clients had been ?hacked? and recruited ruse defendants to smooth their path to obtain authority from courts to subpoena internet service providers. Furthermore, when courts began questioning the defendants? tactics, the defendants repeatedly lied and caused others to lie in order to conceal the true nature of their scheme. CASE Document 1 Filed 12/14/16 Page 9 Cl 36 US. v. Paul Hansmeier et a1. Initial Copyright Infringement Lawsuits Brought by Defendants 18. Beginning in or about September 2010, defendants HANSMEIER and the law ?rm Steele Hansmeier PLLC?~began representing individuals and entities that owned copyrights to pornographic movies. Defendants and their agents monitored ?le?sharing websites and obtained IP Addresses of individuals who downloaded . or attempted to download their clients? movies. Defendants then ?led cepyright - infringement lawsuits against these anonymous individuals, sometimes referred to as ?John 4 Does,? and sought authority from the court??often referred to as ?early subpoena internet service providers for subscriber information associated, with the IP Addresses. 19. After receiving the subscriber information, defendants engaged in aggressive settlement tactics. . Defendants made phone calls and sent letters to-the subscribers associated with targeted IP Addresses in which they threatened overwhelming ?nancial penalties?the copyright statute permits plaintiffs to recover damages of up to $150,000 per infringement?end public disclosure unless the purported infringers agreed to'pay a settlement of $4,000. Many of the individuals who received the defendants? letters and phone calls agreed to pay the settlement rather than incur the expense of defending the lawsuit?which would undoubtedly exceed the settlement amount?or risk being publicly shamed for allegedly downloading pornographic movies. CASE Document 1 Filed 12/14/16 'Page 10 of 36 US. v. Paul Hansmeier et a1. Uploading Clients? Movies to File-Sharing Websites 20. Beginning in or about April 2011, defendants caused P.H. to upload their clients? pornographic movies to BitTorrent ?le-sharing websites, including a website named the Pirate Bay, in order to entice people to download the movies and make it easier to catch those who attempted to obtain the movies. As defendants knew, the BitTorrent websites to Which they uploaded their clients? movies were speci?cally designed to allow users to share ?les, including movies, without paying any fees to the copyright holders. Thus, defendants knowingly caused theirclients? movies-to-be shared anddistn'butedcn BitTorrent websites, andthereby purposely allowed and authorized the BitTorrent users to obtain their clients" movies. i 21. Thereafter, despite colluding in the purported infringement of their clients? copyrights, HAN and STEELE caused lawsuits to be ?led disingenuously alleging that the individuals who purportedly downloaded the movie did so ?without authorization? or consent from the copyright holder or its agents. A, 22. For example, on or about April 1,2011, P.H. uploaded a movie named ?Sexual Obsession,? Which was owned by a client of the defendants named Heartbreaker Productions, to the Pirate Bay. On or about April 28, 2011, after catching approximately 71 IP Addresses engaged in downloading the movie Sexual Obsession, which defendants 7 had caused to be uploaded, the defendants ?led a lawsuit in federal court in Illinois on I behalf of Heartbreaker Productions misleadingly alleging that the 71 ?John Does? had 10 CASE Document 1 Filed 12/14/16 Page 11 0f 36 US. v. Paul Hansmeier et al. downloaded the movie without ?authorization or license? from. Heartbreaker Productions. On or about April 29, 2011, the defendants ?led an ex parte motion seeking to obtain early discovery regarding the identities of the subscribers associated with the 71 IP addresses, and therein falsely and misleadingly represented to the court that the John Does ?without authorization[] used an online peer?to-peer media distribution system to download Plaintiff?s 00pyrighted works and distribute Plaintiff? copyrighted works to the public .. . by making Plaintiff?s copyrighted works available for distribution to others.? After obtaining authority'to subpoenas-r internet service providers for: subscriber information associated with the 71 IP Addresses, the defendants dismissed the lawsuit in order to ?engage in settlement efforts or, if necessary, separate actions.? 23. Thereafter, between April 2011 and approximately December 2012, defendants HANSMEIER and STEELE caused at least approximately 200 fraudulent copyright infringement lawsuits to be ?led in courts throughout the country seeking subscriber information associated with more than 3,000 IP Addresses based on the spurious allegation that certain IP Addresses were caught illegally downloading either Sexual Obsession or another movie owned by Heartbreaker Productions named ?Popular Demand? from the Pirate Bay or other BitTorrent websites, which defendants themselves uploaded and made available for people to download. After ?ling each of the fraudulent lawsuits, HANSMEIER and STEELE ?led or caused to be ?led ex parte motions for early discovery that-failed to disclose their involvement in uploading the copyrighted movies, _11 CASE Document 1 Filed 12/14/16 Page 12 0f 36 US. v. Paul Hansmeier et al. I and falsely accused'the purported downloader of obtaining the movie without authorization or consent. Courts throughout the country, relying on the false and misleading representations made or caused to be made by the defendants, granted early discovery and thereby authorized the defendants to subpoena internet service providers for subseriber information associated with the IP Addresses set forth in the motions and/or civil complaints. 24.. After receiving the subscriber information, HANSMEIER and STEELE employed thesame tactics they previously used in ?order to garner quick settlements from the subscribers they identi?ed. However, defendants falsely represented to the subscribers that they and their clients had legitimate copyright infringement claims against the subscriber when, in fact and as defendants knew, they had uploaded to the BitTorrent website the very movie that they now threatened to sue the subscriber for downloading. By lying to courts in order'to obtain subscriber information and deceiving the subscribers, defendants fraudulently obtained numerous settlement payments. Defendants Attempt to Obscure Their Involvement in the Scheme 25.. In or about November 2011, in i order to distance themselves from the fraudulent copyright infringement lawsuits and any potential fallout, defendants caused Prenda Law to be created. Although P.D. nominally owned Prenda Law, and at times provided assistance to HANSMEIER and STEELE in ?ling and overseeing the copyright litigation, HANSMEIER and STEELE exerted defactci control over Prenda Law, including 12 CASE Documentl Filed 12/14/16 Page 13 of 36 US. v. Paul Hansmeier et al. the primary direction of its employees and diSpensation of its ?nances. Despite controlling Prenda Law, and at various times "?ling appearances for or in connection with Prenda Law, HANSMEIER and STEELE on multiple occasions falsely denied to various courts any direct involvement with or control over Prenda Law. Beginning in or about 2013, defendants at times also used the name Anti-Piracy Law Group, which was nominally controlled by P.D., to pursue their copyright infringement and associated litigation. 26.? Beginning in or about 2011, defendants also created and/or?employed various sham entities, including AF Holdings, Ingenuity 13, Guava, Livewire Holdings, and LW Systems as plaintiffs or; otherwise to further their fraudulent copyright lawsuits. a. AF Holdings. In or about 2011, defendants convinced R.R., the owner of Heartbreaker Productions, to transfer the copyrights to Sexual Obsession and Popular Demand to AF Holdings, supposedly to insulate R.R. from negative publicity surrounding the copyright infringement lawsuits. In order to disguise their control over AF Holdings, defendants used the name of an acquaintance of initials are A.C.?to purportedly sign on behalf of AF Holdings on the copyright transfer agreement. Furthermore, defendants represented and caused to be represented to multiple courts that AF Holdings was owned by a trust named ?Salt Marsh? whose manager and sole bene?ciary was M.L., the paralegal employed by HANSMEIER and STEELE. In fact, and as defendants knew, ML. was nothing more than a ?gurehead who agreed to pose 13 CASE Document 1 Filed 12/14/16 Page 14 0f 36 US. v. Paul Hansmeier et 31. as the owner of AF Holdings in order to help HAN SMEIER and STEELE obscure their ownership and control over the company. b. Ingenuity l3. Defendants caused Ingenuity 13 to be formed, and beginning in about 2011, defendants used Ingenuity 13 to obtain Copyrights over pornographic ?lms, some of which they ?lmed themselves. Thereafter, defendants caused copyright infringement lawsuits to be ?led on behalf of Ingenuity 13. Defendants attimes used name to sign on behalf of Ingenuity 13, and on other occasions falsely represented that Ingenuity 13 was owned or controlled in fact, Ingenuity '13- was? - at all times controlled by the defendants, and the defendants received the proceeds of settlement payments generated by lawsuits ?led on behalf of Ingenuity 13. c. Guava. Defendants caused Guava to be formed, and beginning in about 2012, defendants used Guava to ?le lawsuits alleging that computer systems belonging to Guava had been hacked into, and seek early discovery regarding Addresses they falsely alleged had participated in the hacking activity. Defendants at times falsely represented that Guava was owned or controlled by in fact, Guava was at all times controlled by the defendants. d. Livewire Holdings LW Systems. Defendants caused Livewire I Holdings and LW Systems to be formed, and beginning in about 2013, defendants used Livewire and/or LW Systems to file lawsuits alleging that computer systems belonging to or associated with those entities had been hacked into, and seek early discovery regarding I4 CASE Document 1' Filed 12/14/16 Page 15 Of 36 US. v. Paul Hansmeier et a1. Addresses they falsely alleged had participated in the hacking activity. Defendants at times falsely represented that LiveWire and LW Systems were owned or controlled by in fact, those entities were at all times controlled by the defendants. Defendants Film Their Own Pornographic Movies - and Upload Them to File-Sharing Websites 27. Beginning no later than in or about May 2012, defendants ?lmed and caused to be ?lmed pornographic movies in order to further their fraudulent scheme. on at least three separate occasions, while attending pornographic ?lm conventions in Chicago, h/liarni,landlLasVegas, and? Sill?EELB?attimes assisted by and P.H.??contracted with adult ?lm actresses and produced multiple short pornographic ?lms. Afterwards, HAN SMEIER and STEELE caused Ingenuity 13 to obtain copyrights to the ?lms, which bore namesrsuch as ?Five Fan Favorites? and Peek Behind the Scenes at the Show.? HANSMEIER and STEELE did not publicly distribute or commercially release the movies they ?lmed. Instead, HANSMEIER instructed PH. to upload the movies to ?le-sharing websites such as the Pirate Bay in order to catch,and threaten to sue, people who attempted to download the movies. 28. 7 When the defendants caught people downloading their movies, they then caused fraudulent copyright infringement lawsuits to be filed in various courts throughout the-country, which falsely alleged that certain ?John Does? had downloaded Ingenuity 13 ?3 movies ?without. Plaintiff?s authorization,? and thereby concealed from the courts that the 15 CASE Document 1 Filed 12/147?16 Page 16 of 36 U.S. v. Paul Hansmeier et al. defendants?the lawyers behind the lawsuits?not only controlled the Plaintiff and therefore had a signi?cant personal stake in the outcome of the litigation, but also had colluded to infringe their own copyrights by impliedly authorizing BitTorrent users to download the movies. Defendants also caused false representations to be made to the court in these lawsuits by alleging that Ingenuity 13 had suffered damages as a result of the John Does? conduct, when in fact the John Does? conduct had been the entire purpose of Ingenuity 13?s existence. Defendants Invent Hacking Allegations 29. Beginning in or about Gctober 2012, after courts had begun limiting the discovery defendants could obtain through copyright infringement lawsuits, HANSMEIER and STEELE caused lawsuits to be ?led, generally on behalf of Guava LLC, falsely alleging that their client?s computer systems had been ?hacked,? and that certain John Does used ?hacked usernames/passwords to gain unlawful access to the member?s section of [the client]?s website.? The entirety of defendants? hacking lawsuits was a lie. In fact, Guava (and defendants? other phony clients) had no computer systems; they were sham entities created and controlled by the defendants for the sole purpose of obtaining lawsuit settlements. 30. After the Guava lawsuits were ?led, defendants caused motions for early discovery to be ?led which sought subscriber information associated with certain Addresses that had supposedly gained illegal aeoess to Guava?s computer systems. In 16 CASE Document 1 Filed 12/14/16 Page 17 0f 36 US. v. Paul Hansmeier et al. fact, and as defendants? knew, the IP Addresses listed in the Guava complaints and motions for early discovery were IP Addresses that defendants had caught downloading their or their clients? pornographic movies through ?le-sharing websites on earlier occasions. i 31. In order to attempt to make the Guava lawsuits go smoothly and avoid dif?cult questions by the court, HANSMEIER and STEELE also recruited one or more ruse defendants. The ruse defendants had been caught downloading one of HANSMEIER and clients? movies from a ?le-sharing website. The ruse defendants agreed that, in exchange for HANSMEIER and STEELE-waiving a settlement payment, the ruse defendant would be sued and permit HANSMEIER and STEELE to seek discovery about his/her supposed ?co-conspirators.? As defendants knew, the ruse defendants had not. participated in any hacking activity, nor had they entered Guava?s computer systems With hacked usemames and passwords. . In fact, they had downloaded movies belonging to an entirely different entity. Nonetheless, HANSMEIER and STEELE brought several - lawsuits against these ?ctitious defendants and falsely alleged that they had participated and/or bene?tted from a non-existent cabal of hackers in order to attempt to obtain authority from the court to issue subpoenas to internet service providers to ?nd additional 0 people who they could extort. 17 CASE Document 1 Filed 12/14/16 Page 18 of 36 US. v. Paul Hansmeier et al. Courts Accuse the Defendants of Deception and Defendants Lie to Cover Up Their Fraud 32. In or about early 2013, courts began scrutinizing the defendant?s litigation tactics. Upon uncovering certain of the facts described above, courts began denying the defendants? requests to subpoena internet service providers, dismissing lawsuits that 7 defendants had caused to be ?led, accusing the defendants and their associates of deceptive and fraudulent behavior, and imposing sanctions against the defendants and their associates as a result of their misconduct. For example, on or about May 6, 2013, the District Court for the Central District of California issued an order imposing sanctions against the defendants, and found that: Plaintiffs [including HANSMEIER and have demonstrated their willingness to deceive not just this Court, but other courts where they have appeared. Plaintiffs? representations about . their Operations, relationships, and ?nancial interests have varied from feigned ignorance to misstatements to outright lies. But this deception was calculated so that the Court would grant Plaintiff?s early- discOvery requests, thereby allowing Plaintiffs to identify defendants and exact settlement proceeds from them. With these granted requests, Plaintiffs borrow the authority of the Court to pressure settlement. The Court imposed monetary sanctions in the ferm of awarding attorneys? fees to the . opposing party, referred HANSMEIER and STEELE to their respective state attorney disciplinary bodies, and noti?ed all judges overseeing other copyright infringement cases ?led by the defendants and their associated entities of the Court?s ?ndings. 18 CASE Document 1 Filed 12/14/16 Page 19- 0f 36 US. v. Paul Hansmeier et at. 33. In order to evade detection, further their scheme, and protect the illicit pro?ts they had obtained, defendants repeatedly lied and caused others to lie, including but not limited to the following: I a. On or about November 27, 2012, the defendants caused M.L. to attend a hearing in Sunlust Pictures LLC v. Tuan Nguyen, 12-cv- 1685 (MD. Fla), and purpoit to be the corporate representative of Sunlust Pictures. During the hearing, M.L. falsely and misleadingly testi?ed under oath that he did not know P.D., when in fact he did, and was attending the hearing at the request of a woman named sunny Leone when, in? fact, STEELE had asked M.L. to attend the hearing. 7 b. On or about November 29, 2012, ML. was deposed in Guava LLC v. Skylar Case, 2012 73 63 (Cook Cty Cir. and the defendants caused M.L. to falsely and misleadingly testify under oath that: he was the VP in charge of legal matters for? Guava; and (ii) Guava maintained computer systems that were ?regularly? accessed by hackers, when in fact Guava was a shell company, M.L. had no real involvement with Guava, and the defendants had simply invented the hacking allegations in the complaint. c. . On or about January 25, 2013, in a hearing in Guava LLC v. Spencer Merkel, 27-cv-1220976 (Henri. Cty Dist. CL), STEELE falsely and misleadingly informed the court that Guava had ?some computer equipment? in Illinois and Las Vegas and that certain unknown ?John Does? had hacked into the computer equipment, when in fact Guava was a shell company and the defendants had simply invented the hacking allegations 19 CASE Document 1 Filed 12/14/16 Page 20 of 36 11.8. v. Paul Hansmeier et al.4- in the complaint. In the same hearing, STEELE falsely and misleadingly denied that the defendants had reached a ?deal? with Merkel 'whereby in exchange for the defendants waiving Merkel?s payment of any settlement fee, Merkel had agreed to be sued so that the defendants could conduct discovery. d. On or about February 27, 2013, defendants caused ML. to sign a declaration ?under penalty of perjury,? later ?led in AF Holdings LLC v. Andrew Magsumbol, 1201-4221 (N .D. Cal), falsely and misleadingly representing that he was the of AF in fact, M.L. was nothing more than-a ?gurehead used by the defendants to disguise their involvement with AF Holdings. e. On or aboutMarch 6, 2013, HANSMEIER was deposed in AF Holdings v. Joe Navasca, 12-cv-2396 (ND. Cal), and falsely and misleadingly testi?ed under oath that he had never worked for and had little association-with Prenda Law, and that he was not involved in Prenda?s ?nances. In fact, HANSMEIER, along with exerted substantial control over Prenda Law as well as its ?nances. HAN SMEIER further falsely and misleadingly testi?ed that M.L. was responsible for creating AF Holdings, M.L. was the sole employee and manager of AF Holdings, M.L. was the person responsible for making ?litigation decisions,? and that ?the marching orders eome from? M.L., when in fact HANSMEIER and STEELE caused AF Holdings to be created, and controlled and made decisions on behalf of AF Holdings. HANSMEIER also falsely and misleadingly testi?ed that the purpose of the copyright litigation brought on ?20 CASE Document 1 Filed 12/14/16 Page 21 of 36 US. v. Paul Hansmeier et al. behalf of AF Holdings was not pro?t but ?to generate a deterrent effect in stealing Holdings?] copyrighted works,? when in fact the purpose of the litigation was to generate a pro?t for HANSMEIER and STEELE and the copyrighted works were never made ipublically available for purchase by AF Holdings. f. On or about May 2, 2013, STEELE and HANSMEIER caused ML. to sign an af?davit ?under penalty of perjury,? later ?led in AF Holdings v. Joe Navasca, 12-cv-2396 (N .D. Cal), falsely and misleadingly claiming that ML. ?manage[d] various adult'content related companies, including AF Holdings when in fact HANSMEIER and STEELE controlled AF Holdings. The defendants further caused ML. to falsely and misleadingly represent that?as representative of AF Holdings?he previously signed documents certifying that he reviewed Alternative Dispute Resolution policies with the name ?Salt Marsh? when, in fact, M.L-. neither reviewed any such policies nor signed the certi?cations as ?Salt Marsh.? On or about May 28, 2013, STEELE signed an affidavit ?under penalty of perjury,? later ?led in AF Holdings John Does, 12-ov-1445?49 (D. Minn), wherein he falsely and misleadingly stated that he inerer introduced A.C. to ML. and that thereafter his ?understanding? was that A.C. ?participated in a limited number of transactions in 2011 with companies,? when in fact STEELE used A.C. and names to disguise his control over AF Holdings and Ingenuity l3, and at all relevant times controlled those companies. _21 CASE Document 1 Filed 12/14/16 Page 22 Of 36 US. v. Paul Hansmeier et al. h. On or about July 8, 2013, STEELE ?led a complaint and caused M.L. to ?le a complaint with the State Bar of California against B.G., an attorney hired by HANSMEIER and STEELE to oversee copyright litigation on behalf of Prenda Law, wherein STEELE falsely and misleadingly claimed (and caused M.L. to claim) that M.L. was the manager of AF Holdings when, in fact, M.L. was merely a ?gurehead to obscure HANSMEIER and control over AF Holdings. STEELE ?n'ther' falsely and misleading alleged in the bar complaints that 3.6. was the primary attorney for AF Holdings; thereby falsely minimizing HANSMEIER and af?liation with and - control over AF Holdings. I i. On or about August 26, 2013, the defendants caused M.L. to sign an af?davit ?under penalty of perjury,? later ?led in Holdings v. John Does, 12-cv-1445- 49 (D. Min.), wherein M.L. falsely and misleadingly represented that the membership interests in AF Holdings are held in a trust named ?Salt Marsh,? whose sole bene?ciaries are unborn children, and that M.L. was AF Holdings? managing member. In fact, AF Holdings was controlled by STEELE and HAN SMEIER, and ML. merely served as a nominee to conceal the defendant?s interest in AF Holdings. j. On or about August 27, 2013, STEELE and HANSMEIER caused ML. to sign a notarized declaration ?under penalty of perjury,? later ?led in AF Holdings v. Joe Navasca,? 12-cv-2396 (ND. Cal), falsely and misleadingly declaring: M.L. formed Holdings in mid-201 1; (ii) that he was ?the only manager? that AF Holdings, 22 CASE Document 1 Filed 12/14/16 Page 23 of 36 US. v. Paul I?lansmeier et al. LLC ever had, that John Steele, nor Paul Hansmeier ever served as a director, of?cer, manager, or employee of AF Holdings or otherwise possessed managerial authority or an ownership interest in AF Holdings?; (iv) that ?[t]he only role that Steele, and Hansmeier have played with respect to AF Holdings, LLC is that of its attorney.? In fact, STEELE and HAN SMEIER created AF Holdings and were at all relevant times the defacro owners of and controlled AF Holdings. In the same declaration, STEELE and 4 HANSMEIER caused M.L. to falsely and misleadingly declare that he started AF Holdings because? he"?be?lieved that [he] couldpurchaseicopyri'ghts for little?to-nothing, retain attorneys to ward off the piracy and then resell the copyrights for a pro?t?; (ii) that ?[t]he copyrights Holdings] held would be worth 1 signi?cant sums if even a reasonable percentage of the peeple who stole the content instead purchased it?; and that litigation was simply ?a necessary evil,? when in fact, the copyrights owned by Holdings were obtained for the sole purpose of litigation and the copyrighted works were never made publically available for purchase by AF Holdings. I i k. On or about August 28, 2013, HANSMEIER signed a declaration ?under penalty of perjury,? later ?led in AF Holdings v. Joe Navasca, 12-ev?2396 (ND. Cal), falsely and misleadingly lclaiming that have never served as a director, of?cer, manager, or employee of?AF Holdings or otherwise possessed managerial authority over or an ownership interest in AF Holdings? when in fact HANSMEIER and STEELE owned and controlled AF Holdings. In the same declaration, HANSMEIER falsely and 23 r? CASE Document 1 Filed 12/14/16 Page'24 0f 36 US. v. Paul Hansmeier et al. misleadingly claimed that have never created a Pirate Bay account in my life and Categorically deny ever uploading and/or downloadng any BitTorrent files of any past client of mine, including AF Holdings? when in fact HANSMEIER and STEELE caused PH. to upload their purported clients? pornographic movies to BitTorrent file-sharing websites. l. .011 or about September 30?, 2013, STEELE falsely and misleadineg testi?ed under oath at a hearing in AF Holdings v. John Does, lZ-cv-1445?49 (D. Minn.) that was the ?controlling member? 'of'AF Holdings, and that AC. had spoken to and given permission to M.L. for AF Holdings to use name on a cepyright transfer document. STEELE further testi?ed, falsely and misleadingly, that he had ?no ownership interest, never had, in Prenda Law. I didn?t set up a company, bogus or otherwise, AF Holdings.? In fact, STEELE and HANSMEIER exerted control over AF Holdings and Prenda Law, and ML. was a pawn used by STEELE and HANSMEIER to conceal their involvement in the scheme. During this hearing, HAN SMEIER (acting as an attorney for AF Holdings) asked questions of STEELE and thereby suborned the perjury set forth above. In. I On or about January 28,2014, STEELE caused M.L. to falsely and misleadingly testify under oath in a hearing in AF Holdings v. Rajesh Patel, 12-cv-262 (ND. Ga), that he was the ?trustee? and ?owner? of AF Holdings, and that STEELE and HANSMEIER did not own any part of AF Holdings. M.L. further falsely and 24 CASE Document 1 Filed 12/14/16 Page 25 of 36 US. v. Paul Hansmeier et al. misleadingly described B.G. and RD. as primarily reSponsible for Prenda Law?s cepyright litigation, and falsely downplayed STEELE and in AF Holdings and in the related copyright litigation. n. On or about April 8, 2015, STEELE falsely and misleadingly testi?ed under oath in a deposition in Alan Cooper v. John Steele et al., 27?cv-13-3463 (Henn. Cty Dist. that: did not run or manage in any way AF Holdingsg? ML. ?operates? AF Holdings; and ML. ?runs? Guava LLC. In fact, STEELE and HANSMEIER ?managed, operated, and controlled AF Holdings and Guava 34- In total, between 2010 and 2013, defendants and their entities received more than $6,000,000 in cepyright infringement settlement payments. Of this amount, more than $3,000,000 was paid to or on behalf 'of Paul HANSMEIER and John STEELE. Of the remaining amount, only approximately 3 1,000,000 was paid to clients and STEELE, and the rest was spent on expenses associated with carrying out the scheme. All in violation of Title 18, United States Code, Sections .1349. COUNTS 2-6 (Mail Fraud) 18 U.S.C. 1341 35. The allegations contained in paragraphs 1 through 34 of this Indictment are re-alleged as if stated in full herein. 36. On or about the following dates, in the State and District of Minnesota and elsewhere, the defendants, 25 CASE Document 1 Filed 12/14/16 Page 26 of 36 US. v. Paul Hansmeier et al. PAUL R. HAN SMEIER and JOHN L. STEELE, having devised and intending to devise the scheme and arti?ce described above, caused to be sent, delivered, and moved by the United States Postal Service and private and commercial interstate carrier various mailings, items and things for the purpose of executing and attempting to execute such Scheme and arti?ce: COUNT DATE (on or about) MAILING DETAILS December 29,2011 Letter sent by ?Premier Law on behalf of AF Holdings to PlMithreatening legal?action unless a settlement fee of $3,400 was paid. August 28, 2012 Letter sent by Prenda Law on behalf of AF Holdings to S.Y. threatening legal action unless a settlement fee of $4,000 was paid. November 7, 2012 Letter sent by Prenda Law on behalf of Ingenuity 13 to D.W. threatening legal action unless a settlement fee of $4,000 was paid. NoVember 21, 2012 Letter sent by Prenda Law on behalf of Ingenuity 13 to D.W. threatening legal action unless a settlement fee was paid. March 26, 2013 Letter sent by Anti-Piracy Law Group on behalf of LW Systems to RR. threatening legal action unless a settlement fee was paid. All in violation of Title 18, United States Code, Sections 1341 and 2. 26 CASE Document 1 Filed 12/14/16 Page 27 of 36 . US. v. Paul Hansrneier et al. (Wire Fraud) 18 U.S.C. 1343 37. The allegations contained in paragraphs 1 through 34 of this Indictment are re?alleged as if stated in full herein. 38. On or about the following dates, in the State and District of Minnesota, the defendant, PAUL R. HANSMEIER and JOHN L. STEELE, having devised and intending to devise the scheme and arti?ce described above, caused to be transmitted by means of wire communication in interstate commerce the following, writings, signs, signals, pictures, and sounds for the purpose of executing and attempting to execute such scheme and arti?ce: COUNT DATE WIRE DETAILS (on or about) Processing and settlement of check in the . 7 January 5? 2012 . amount of $2,400 from RM. to Prenda Law Uploading of torrent ?le associated with ?Fan 8 June 1, 2012 Favorite: Madison ox Busty Beauty in Red Lingerie? to the Pirate Bay - Uploading of torrent ?le associated with ?Fan 9 June 1, 2012 FavOrite: Amy Brooke Anal Dildo and Squirting? to the Pirate Bay 27 CASE Document 1 Filed 12/14/16 Page 28 0f 36 US. v. Paul Hansmeier et al. COUNT DATE WIRE DETAILS (on or about) Uploading of torrent ?le associated with ?Fan 10 June 2, 2012 Favorite: Tory Lane Pink Heels? to the Pirate Bay Uploading of torrent ?le associated with an 11 June 2, 2012 Favorite: Rosemary Radiva Petite, Sexy Asian Plays with Herself? to the Pirate Bay Uploading of torrent file associated with ?Fan 12 June 2, 2012 Favorite: Spencer Scott? Playmate on 21 to the Pirate Bay Uploading or torrent ?le associated With 13 August 21, 2012 Peek Behind the Scenes at the Show? to the Pirate Bay Processing and settlement of Cashier?s Check in 14 March 1? 2013 the amount of $2,200 from W.W. to Prenda Law Processing and settlement of check in the 15 Mam? 8? 2013 amount of$1,500 from PR. to LW Systems Processing and settlement of check in the 16 April 10, 2013 amount of $1,200 from MB. to Livewire Holdings - All in Violation of Title 18, United States Code, Sections 1343 and 2. 28 CASE Document 1 Filed 12/14/16 . Page 29 Of 36 US. v. Paul Hansmeier et al. COUNT17 (Conspiracy to Commit Money Laundering) 18 1956(h) 39. The allegations contained in paragraphs 1 through 38 of this Indictment are re-alleged as if stated in full herein. 40. Beginning no later than in or about 2012? and continuing at least through in or about 2013, in the State and District of Minnesota and elsewhere, the defendants, PAUL R. HANSMEIER and JOHN L. STEELE, did knowingly and willfully combine, conspire, and agree to conduct and attempt to conduct ?nancial transactions affecting interstate commerce, namely, transfers of funds related to Under the Bridge Consulting, knowing that the property involved in the ?nancial transactions involved proceeds of a speci?ed unlawful activity, that is, conspiracy to commit mail fraud and wire fraud, in violation of Title 18, United States Code, Section 1349, mail fraud in violation of Title 18, United States Code,- Section 1341, and wire fraud, in violation of Title 18, United States Code, Section 1343, and knowing that the transactions were designed in whole or in part to conceal or disguise the nature, source, ownership, and control of the proceeds of the Specified unlawful activity, in violation of Title 18, United States Code, Section All in violation of Title 18, United States Code, Section 1956(h). 29 CASE Document 1 Filed?12/14/16 Page 30 0f 36 US. v. Paul Hansmeier et al. COUNT 18 (Conspiracy to Commit and Suborn Perjury) 18 U.S.C. 371 41. The allegations contained in paragraphs 1 through 34 of this Indictment are re-alleged as if stated. in full herein. 42. Beginning no later than in or about 2012 and continuing at least through in or about2014, in the State and District of Minnesota and elsewhere, the defendants, PAUL R. HANSMEIER and JOHN L. STEELE, did unlawfully, knowingly, voluntarily, and intentionally combine, conspire, confederate, and agree with each other and others to commit an offense against the United States, 1namely to commit and subom perjury in violation of Title 18, United States Code, Sections .1621 and 1622. . Purpose of the Conspiracv 43. The purpose of the conspiracy Was to conceal and disguise their involvement in the scheme described in paragraphs 1 through 34 of the Indictment by providing false and misleading testimony and declarations, and causing others to provide false and misleading testimony and declarations, in cases and to courts throughout the country. Manner and Means of the Consniracy 44. The manner and means of the conspiracy are described in paragraphs 1 through 34 of the Indictment. 30 CASE Document 1 Filed 12/14/16 Page 31 of 36 US. v. Paul Hansmeier et al. Overt Acts 45. In order to effect the objects of the conspiracy and in furtherance of the con3piracy, the conspirators committed and caused to be?committed the following speci?c acts, among others: a. On or about February 27, 2013, defendants caused M.L. to sign a declaration ?under penalty of perjury,? later ?led in AF Holdings LLC v. Andrew Magsumbol, 12-cv-4221 (ND. Cali), falsely and misleadingly representing that he was the of AF Holdings when, in fact, ML. was nothing more than a ?gurehead used by the defendants to disguise their involvement with AF Holdings. I i b. On or about March 6, 2013, HANSMEIER was deposed in AF Holdings v. Joe Navasca, lZ-cv-ZB 96 (N .D. (3311.), and falsely and misleadingly testi?ed under oath that he had never worked for and had little association with Prenda Law, and that he was not involved in Prenda?s ?nances. In fact, HANSMEIER, along with STEELE, exerted substantial control over Prenda Law as well as its ?nances. HANSMEIER further falsely and misleadingly testi?ed that ML. was re5ponsible for creating AF Holdings, M.L. was the sole employee and manager of AF Holdings, ML. was the person responsible for making ?litigation decisions,? and that ?the marching orders come from? M.L., when in fact HANSMEIER and STEELE caused AF Holdings to be created, and controlled and made decisions on behalf of AF Holdings. HAN SMEIER also falsely and misleadingly testi?ed that the purpose of the copyright litigation brought on 31 CASE Document 1 Filed 12/14/16 Page 32 0f 36? US. v. Paul Hansmeier et al. behalf of AF Holdings was not pro?t but ?to generate a deterrent effect in stealing Holdings?] copyrighted works,? when in fact the purpose of the litigation was to generate a pro?t for HANSMEIER and and the copyrighted works were never made publically available for. purchase by AP Holdings. I i c. On or about May 2, 2013, STEELE and HANSMEIER caused ML. to sign an af?davit ?under penalty of perjury,? later ?led in AF Holdings v. Joe Navasca, 12-cv-2396 (N.D. Ca1.), falsely and misleadingly claiming that M.L. ?manage[d] various adult content related companies, including AF Holdings when in fact HANSMEIER and STEELE controlled AF Holdings. The defendants further caused M.L. to falsely and misleadingly represent that?as representative of AF Holdings?he previously signed documents certifying that he reviewed Alternative Dispute Resolution policies with the name ?Salt Marsh? when, in fact, ML. neither reviewed any such policies nor signed the certi?cations as ?Salt Marsh.? (1. On or about May 28, 2013, STEELE signed an af?davit ?under penalty of perjury,? later ?led in AF Holdings v. John Does, 12-cv-1445-49 (D. Minn), wherein he falsely and misleadingly stated that he merely introduced A.C. to ML. and that thereafter his ?hnderstanding? was that AC. ?participated in a limited number of transactions in 2011 with companies," when in fact STEELE used AC. and names to disguise his control over AF Holdings and Ingenuity 13, and at all relevant times controlled those companies. 32 CASE Document 1 Filed 12/14/16 Page 33 of 36 US. v. Paul Hansmeier et al. e. On or about August 26, 2013, the defendants caused ML. to sign an af?davit ?under penalty of perjury,? later ?led in AF Holdings v. John Does, 12-cv-1445? 49 (D. Minn), wherein ML. falsely and misleadingly represented that the membership - interests in AF Holdings are held in a trust named ?SaltMarsh,? whose sole bene?ciaries are unborn children, and that M.L. was AF Holdings? managing member. In fact, AF Holdings was controlled by STEELE and HANSMEIER, and ML. merely served as a nominee to conceal the defendant?s interest in AF Holdings. f. - On or about August 27, 2013, STEELE and HANSMEIER caused M.L. to sign a notarized declaration ?under penalty of perjury,? later ?led in AF Holdings v. Joe Navasca, 12-cv-2396 (N .D. Cal.), falsely and misleadingly declaring: M.L. formed AF Holdings in mid-2011; (ii) that he was ?the only manager? that AF Holdings, LLC ever had; that ?[n]either John Steele, nor Paul Hansmeier ever served as a director, of?cer, manager, or employee of AF Holdings or otherwise possessed managerial authority or an ownership interest in AF Holdings?; (iv) that ?[t]he only role that Steele, and Hansmeier have played with respect to AF Holdings, LLC is that of its attorney.? In fact, STEELE and HANSMEIER created AF Holdings and were at all relevant times i the defacto owners of and controlled AF Holdings. In the same declaration, STEELE and HAN SMEIER caused M.L. to falsely and misleadingly declare that he started AF Holdings because he ?believed that [he] could purchase copyrights for little-to-nothing, retain attorneys to ward off the piracy and then resell the copyrights for a profit?; (ii) that ?[t]he 33 CASE Document 1 Filed 12/14/16 Page 34 of 36 US. v. Paul Hansmeier et al. 1 copyrights Holdings] held would be worth signi?cant sums if even a reasonable percentage of the people who stole the content instead purchased it?; and that litigation was simply ?a necessary evil,? when in fact, the copyrights owned by AF Holdings were obtained for the sole purpose of litigation and the c0pyrighted works were never made publically available for purchase by AF Holdings. g. On or about August 28, 2013, HANSMEIER signed a declaration V?V?under penalty of perjury,? later ?led in AF Holdings v. .loe Navasca, 12-cv?2396 (ND. Cat), falsely and misleadingly claiming that have never'served as a director, of?cer, manager, or employee of AF Holdings or otherwise possessed managerial authority over or an ownership interest in AF Holdings? when in fact HANSMEIER and STEELE owned and controlled AF Holdings. In the same declaration, HANSMEIBR falsely and misleadingly claimed that have never created a Pirate Bay account in my life and categorically deny ever uploading and/or downloading any BitTorrent ?les of any past client of mine, including AF Holdings? when in fact HANSMEIER and STEELE caused P.H. to upload their purported clients? pornographic movies to BitTorrent ?le?sharing websites. h: On or about September 30,. 2013?, STEELE falsely and misleadingly testi?ed under oath at a hearing in AF Holdings v. John Does, 12?cv?1445-49 (D. Minn.) that M.L. was the ?controlling member? of AF Holdings, and that A.C. had spoken to. and given permission to M.L. for AF Holdings to use name on a copyright transfer 34 CASE Document 1 Filed 12/14/16 Page 35 of 36 US. v. Paul Hansmeier et document. STEELE ?thher testi?ed, falsely and misleadingly, that he had ?no ownership interest, never had, in Prenda Law. I didn?t set up a company, bogus or otherwise, AF Holdings.? In fact, STEELE and HANSMEIER exerted control over AF Holdings and Prenda Law, and M.L. was a pawn used by STEELE and HANSMEIER to conceal their involvement in the scheme. During this hearing, HANSMEIER (acting as an attorney for AF Holdings) aslced questions of STEELE and thereby suborned the perjury set forth above. - - i. On or about January 28, 2014, STEELE caused M.L. to falsely and - misleadingly testify under oath in a hearing in Ali-Holdings v. Rajesh Patel, 12-cv-262 (N that he was the ?trustee? and ?owner? of AF Holdings, and that STEELE and HANSMEIER did not own any part of AF Holdings. M.L. further falsely and misleadingly described B.G. and PD. as primarily responsible for Prenda Law?s copyright litigation, and falsely downplayed STEELE and role in AF Holdings and in the related copyright litigation. . All in violation of Title 18, United States Code, Section ?371 . FORFEITURE ALLEGATIONS i 46. Counts 1-17 of this Indictment are hereby realleged and incorporated as if fully set forth herein by reference, for the purpose of alleging forfeitures pursuant to Title 18, United States Code, Sections 981(a)(l)(Cl and 982(a)(1), and Title 28, United States Code, Section 2461(0). 35 CASE Document 1 Filed 12/14/16 Page 36 of 36 US. v. Paul Hansmeier et al. 47. As the result of the offenses alleged in Counts 1-16 of this Indictment, the defendants shall forfeit to the United States pursuant to Title 18, United. States Code, Section in conjunction with Title 28, United States Code, Section 2461(c), any preperty, real or personal, which constitutes or is derived from proceeds traceable to the violations alleged in Counts 1-16 of this Indictment. 48. As a result of the offenses alleged in Count 17 of this Indictment, the defendants shall forfeit to the United States pursuant to Title United States Code, Section 982(a)(1), all property, real orpersonal, involved in the violations allegedin Count 17 of this Indictment, or any property traceable to such property. 49. I If any of the above-described forfeitable preperty is unavailable for forfeiture, the United States intends to seek the forfeiture of substitute preperty as provided for in Title 21, United States Code, Section 853(p), as incorporated by Title 28, United States Code, Section 2461(0), and by Title 18, United States Code, Section 982(b)(l). A TRUE BILL UNITED STATES ATTORNEY FOREPERSON 36