Case 3:18-cr-04683-GPC Document 349 Filed 03/24/22 PageID.4493 Page 1 of 12
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`MINTZ, LEVIN, COHN, FERRIS,
`GLOVSKYAND POPEO, P.C.
`Randy K. Jones, SBN 141711
`3580 Carmel Mountain Road, Suite 300
`San Diego, CA 92130
`Telephone: (858) 314-1510
`Email: rkjones@mintz.com
`
`Daniel J. Goodrich, BBO 692624 (Pro
`Hac)
`Ryan Dougherty, BBO 703380 (Pro Hac)
`1 Financial Center
`Boston, MA 02111
`djgoodrich@mintz.com
`rtdougherty@mintz.com
`
`Attorneys for Mark Manoogian
`
`WIECHERT, MUNK &
`GOLDSTEIN, PC
`David W. Wiechert, SBN 94607
`Jessica C. Munk, SBN 238832
`27136 Paseo Espada, Suite B1123
`San Juan Capistrano, CA 92675
`Telephone: (949) 361-2822
`Email: dwiechert@aol.com
` jessica@wmgattorneys.com
`
`Attorneys for Jacob Bychak
`
`BIRD, MARELLA, BOXER,
`WOLPERT, NESSIM, DROOKS
`LINCENBERG & RHOW P.C.
`Gary S. Lincenberg, SBN 123058
`Nicole R. Van Dyk, SBN 261646
`Darren L. Patrick, SBN 310727
`Alexis A. Wiseley, SBN 330100
`1875 Century Park East, Floor 23
`Los Angeles, CA 90067
`Telephone: (310) 201-2100
`Email: glincenberg@birdmarella.com
` nvandyk@birdmarella.com
` dpatrick@birdmarella.com
` awiseley@birdmarella.com
`
`Attorneys for Petr Pacas
`
`BIENERT KATZMAN
`LITTRELL WILLIAMS LLP
`Thomas H. Bienert, Jr., SBN 135311
`James D. Riddet, SBN 39826
`Whitney Z. Bernstein, SBN 304917
`Carlos A. Nevarez, SBN 324407
`903 Calle Amanecer, Suite 350
`San Clemente, California 92673
`Telephone: (949) 369-3700
`Email: tbienert@bklwlaw.com
`
` jriddet@bklwlaw.com
`
` wbernstein@bklwlaw.com
` cnevarez@bklwlaw.com
`
`Attorneys for Mohammed Abdul Qayyum
`
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`DEFENDANTS’ MOTION IN LIMINE NO. 3
`
`Case No. 18-CR-4683-GPC
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`

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`Case 3:18-cr-04683-GPC Document 349 Filed 03/24/22 PageID.4494 Page 2 of 12
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`Plaintiff,
`
`UNITED STATES OF AMERICA,
`
`
`
`v.
`
`JACOB BYCHAK, et al.,
`
` Defendants.
`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE SOUTHERN DISTRICT OF CALIFORNIA
`
`Case No. 18-CR-4683-GPC
`Honorable Gonzalo P. Curiel
`
`DEFENDANTS’ MOTION IN
`LIMINE NO. 3:
`
`TO PRECLUDE THE
`GOVERNMENT FROM
`IMPROPERLY RELYING ON THE
`NORTEL TRANSACTION AT
`TRIAL TO PROVE DEFENDANTS’
`STATE OF MIND WHEN
`ACQUIRING IP ADDRESSES
`FROM GETADS
`
`Date: April 7, 2022
`Time: 1:00 p.m.
`Dept.: 2D
`
`
`
`TO ALL PARTIES AND THEIR COUNSEL OF RECORD:
`PLEASE TAKE NOTICE that on April 7, 2022, at 1:00 p.m., or as soon
`thereafter as the matter may be heard in the courtroom of the Honorable Gonzalo P.
`Curiel, United States District Court Judge, located at 221 West Broadway, San
`Diego, California 92101, Courtroom 2D, Defendants Jacob Bychak, Mark
`Manoogian, Mohammed Abdul Qayyum, and Petr Pacas (collectively,
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`1
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`Case No. 18-CR-4683-GPC
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`

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`Dated: March 24, 2022
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`Dated: March 24, 2022
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`“Defendants”) hereby move the Court to preclude the government from arguing at
`trial that because Company A purchased certain internet protocol (“IP”) addresses
`from its vendor, GetAds, between 2011 and 2013 for less than $2 per IP address—
`whereas Microsoft paid $11 per IP address in connection with the Nortel
`Transaction (as hereinafter defined) in 2011—Defendants knew or should have
`known that the purportedly “below-market” GetAds IP addresses had been
`unlawfully obtained, “stolen,” or “hijacked.”
`This Motion In Limine No. 3 is based on Federal Rules of Evidence 104(b),
`403 and 704, this Notice of Motion, the below Memorandum of Points and
`Authorities, the Indictment, and such other and further argument and evidence as
`may be presented to the Court at the hearing on this matter.
`
`Dated: March 24, 2022
`
` BIRD, MARELLA, BOXER, WOLPERT,
`NESSIM, DROOKS, LINCENBERG &
`RHOW, P.C.
` By: s/ Gary S. Lincenberg
`Gary S. Lincenberg
`Nicole Rodriguez Van Dyk
`Darren L. Patrick
`Alexis A. Wiseley
`Attorneys for Petr Pacas
`
`
`
` WIECHERT, MUNK & GOLDSTEIN, PC
` By: s/ Jessica C. Munk
`Jessica C. Munk
`David W. Wiechert
`Attorneys for Jacob Bychak
`
`
`
` BIENERT KATZMAN
`LITTRELL WILLIAMS LLP
` By: s/ Whitney Z. Bernstein
`
`Whitney Z. Bernstein
`Thomas H. Bienert, Jr.
`James D. Riddet
`Carlos A. Nevarez
`Attorneys for Mohammed Abdul Qayyum
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`2
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`Case 3:18-cr-04683-GPC Document 349 Filed 03/24/22 PageID.4496 Page 4 of 12
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`Dated: March 24, 2022
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` MINTZ, LEVIN, COHN, FERRIS,
`GLOVSKY AND POPEO, P.C.
` By: s/ Randy K. Jones
`Randy K. Jones
`Daniel J. Goodrich (Pro Hac)
`Ryan Dougherty (Pro Hac)
`Attorneys for Mark Manoogian
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`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`I.
`
`MEMORANDUM OF POINTS AND AUTHORITIES
`INTRODUCTION
`Defendants Jacob Bychak, Mark Manoogian, Mohammed Abdul Qayyum,
`and Petr Pacas (collectively, “Defendants”) are charged with wire fraud based on
`allegations that they “fraudulently acquired” certain internet protocol (“IP”)
`addresses that Company A purchased from GetAds between 2011 and 2013. (See
`Indictment ¶ 2(c)). In arguing that IP addresses qualify as “property” within the
`meaning of the wire fraud statute, the government has relied on an unrelated, third-
`party transaction in 2011 in which Nortel Networks, Inc.—a debtor in the Delaware
`Bankruptcy Court—sold its rights “in and to” 666,624 legacy IP addresses to
`Microsoft for $7.5 million, or approximately $11 per IP address (the “Nortel
`Transaction”).1
`Defendants anticipate that the government will also seek to use the Nortel
`Transaction at trial as purported state-of-mind evidence related to Defendants’
`acquisition of IP addresses from GetAds. Specifically, the government may seek to
`argue that because Company A purchased IP addresses from GetAds for less than $2
`per IP address—whereas Microsoft paid $11 per IP address in the Nortel
`Transaction—Defendants knew or should have known that their “below-market” IP
`addresses had been unlawfully obtained, “stolen,” or “hijacked.” Indeed, the
`government recently identified Sandra Brown—a Nortel representative at the time
`of the Nortel Transaction—as an anticipated expert witness to “render opinions on
`the value of IP addresses and the factors affecting or influencing value during the
`times relevant to the conspiracy timeframe.” See ECF No. 340.
`The government should be excluded from using the Nortel Transaction—or
`Sandra Brown’s anticipated testimony about it—as purported evidence of
`
`
`1 See In re Nortel Networks Corp., Case No. 09-10138 (Bankr. D. Del. 2010), D.I.
`5315 (Sale Order); D.I. 5252-1 (Amended Purchase Agreement).
`
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`4
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`Defendants’ state of mind for numerous reasons.
`First, for the Nortel Transaction to have any relevance to the Defendants’
`intent, the government would have to establish a large number of predicate facts
`which are now absent from the record. These include: (1) Defendants’ actual
`knowledge of the Nortel Transaction; (2) Defendants’ subjective belief that the
`Nortel Transaction’s $11-per-IP-address price represented the objective “value” of
`the IP addresses that Company A purchased from GetAds; (3) facts demonstrating
`that Microsoft paid “fair value” in the Nortel Transaction; and (4) facts
`demonstrating that the market valued the GetAds IP addresses at a higher price than
`Company A paid. Without evidence of these predicate facts (which the government
`has failed to establish), the Nortel Transaction is irrelevant to the Defendants’ state
`of mind while transacting business with GetAds, and should be excluded under Rule
`104(b) if offered for that purpose.
`Second, the government’s reliance on the Nortel Transaction as evidence of
`criminal intent would be highly prejudicial and confusing, and should therefore
`excluded under Rule 403. The fact that Microsoft is a giant, well-known company
`might cause a juror to infer—without independent evidence—not only that
`Defendants were aware of the Nortel Transaction, but that the $11-per-IP price was
`an objective “market” standard applicable to all buyers and sellers. Further, the
`Nortel Transaction has little to no probative value here. Defendants played no role
`in the Nortel Transaction, nor were they experts in the field of brokering or valuing
`IP addresses. At most, Company A acquired certain IP addresses for the sole
`purpose of conducting its email marketing business.
`II. BACKGROUND
`A. The Wire Fraud Counts in the Indictment Accuse Defendants of
`Scheming to Acquire Inactive IP Addresses
`On October 31, 2018, the government brought felony criminal wire fraud and
`
`CAN-SPAM Act charges against four employees of a large digital advertising
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`5
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`company (“Company A”). The premise of the Indictment is that Defendant
`employees, who were responsible for leasing or purchasing IP addresses on behalf
`of Company A, allegedly “acquired” IP addresses for Company A that were in
`actuality registered to other companies. (Indictment ¶ 2.) One dispute at trial will
`revolve around whether Defendants believed they were purchasing legitimate IP
`addresses from the government’s cooperating witness Daniel Dye and his company,
`GetAds; or whether, as the government alleges, Defendants knew the addresses to
`be “stolen”. Defendants deny the government’s characterization of the events.
`The Government Relies on the Nortel Transaction To Support The
`B.
`Wire Fraud Counts In the Indictment
`The government has relied on the Nortel Transaction in its prior briefing as
`purported evidence that IP addresses are “something of value” and, therefore,
`qualify as “property” within the meaning of the wire fraud statute—which
`Defendants dispute. See, e.g., Government’s 6/26/20 Response In Opposition to
`Defendants’ Motion to Dismiss the Wire Fraud Counts for Fifth Amendment Due
`Process & Sixth Amendment Due Process Violations, ECF No. 176, at 28-29
`(referring to the “$7.5 million sale of 660,000 IPv4 addresses from Nortel to
`Microsoft” as evidence that IP addresses have monetary value).
`Defendants dispute the government’s characterization of the Nortel
`Transaction as evidence that IP addresses are “property.” In fact, the American
`Registry of Internet Numbers (ARIN) intervened in the Nortel bankruptcy case, took
`the position that IP addresses are not property, and insisted on modifications to the
`Microsoft-Nortel purchase agreement and the proposed sale order (both of which the
`bankruptcy court accepted), including crossing out the following sentence: “The
`Internet Numbers are property of the Seller’s bankruptcy estate.” See In re Nortel
`Networks Corp., Case No. 09-10138 (Bankr. D. Del. 2010), D.I. 5252-5 (Blackline
`Sale Order) at p. 8; see also id., D.I. 5252-4 (Blackline Purchase Agreement)
`(conforming changes).
`
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`6
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`

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`C. The Government Identifies Sandra Brown—A Nortel Insider—As
`An Expert Witnesses
`On March 10, 2022, the government filed its First Notice of Expert Witnesses
`and Witnesses with Expertise, which named Sandra Brown—a representative of
`Nortel at the time of the Nortel Transaction—as an anticipated expert witness at
`trial. See ECF No. 340. The disclosure states, in relevant part:
`
`Sandra Brown is the president and founder of IPv4 Market Group
`(https://ipv4marketgroup.com). Since its creation in May 2011, IPv4
`Market Group has been a full-service broker of IPv4 netblocks, and
`specializes in IPv4 transfers from sellers to buyers in ARIN, RIPE, and
`APNIC regions. Prior to creating IPv4 Market Group, Ms. Brown
`worked as the Director of IT Engineering at Nortel Networks
`Corporation (Nortel) from January 2010 through May 2011. In May
`2011 while at Nortel, Ms. Brown orchestrated the very first
`commercial transfer, a $7.5 million sale of 660,000 IPv4 addresses
`from Nortel to Microsoft, which inspired the creation of IPv4 Market
`Group. Since that first commercial sale, Ms. Brown and IPv4 Market
`Group have completed over 700 transfers of blocks of IP addresses.
`[…]
`Ms. Brown will describe a typical transaction to sell, purchase, or
`lease an IP block, as well as the paperwork, time, and resources
`involved from the 2011-time frame to present-day. Ms. Brown will
`discuss the industry’s standards and practices at or near the dates of
`the transfers of the netblocks at issue in this case.
`[…]
`Based on her extensive experience in brokering IPv4s and negotiating
`and consummating the sale, purchase, or lease of IP netblocks, the
`government anticipates she will testify that IP addresses are unique, can
`be sold, and the registered users and/or purchasers of IP addresses can
`have exclusive possession, use, and control. She will further testify that
`a sale of a block of IP addresses conveys the rights, title, and interest of
`the block, and IP addresses have value. Relying on her subject matter
`expertise, and considering the 700 transactions by IPv4 Market
`Group from 2011 to current-day, Brown will render opinions on the
`value of IP addresses and the factors affecting or influencing value
`during the times relevant to the conspiracy timeframe.
`(See id. at pp. 5-6 (emphasis added).)
`III. ARGUMENT
`The government should be precluded from arguing at trial that because
`Company A purchased IP addresses from GetAds for less than $2 each—whereas
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`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`Microsoft paid $11 per IP address in connection with the Nortel Transaction—
`Defendants knew or should have known that the GetAds IP addresses were
`purportedly tainted or had been unlawfully obtained, “stolen,” or “hijacked.”
`First, under Rule 104(b), evidence that is only conditionally relevant cannot
`be admitted into evidence unless the condition for relevancy has been met. See FRE
`104(b) (“When the relevance of evidence depends on whether a fact exists, proof
`must be introduced sufficient to support a finding that the fact does exist. The court
`may admit the proposed evidence on the condition that the proof be introduced
`later”). Here, the conditions for relevancy are many and varied. The government
`would have to prove that Defendants were not only aware of the Nortel Transaction,
`but believed that the $11-per-IP-address price represented fair value. Moreover, the
`government would have to prove that Microsoft actually paid “fair value” in the
`Nortel Transaction, and that the GetAds IP addresses were “worth” the same
`amount. Without evidence of each of these predicate facts, the Nortel Transaction
`would have no relevance to the Defendants’ state of mind while transacting business
`with GetAds.2
`Second, under Rule 403, even evidence with marginal relevance should be
`excluded if its probative value is outweighed by “unfair prejudice, confusing the
`issues, misleading the jury, undue delay, wasting time or needlessly presenting
`cumulative evidence.” FRE 403. The Court “has wide latitude in making Rule 403
`decisions.” United States v. Hitt, 981 F.2d 422, 424 (9th Cir. 1992). The rule
`“recognizes that as the probative value of evidence decreases, the potential increases
`
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`2 To the extent that Ms. Brown’s testimony is offered as an opinion about
`Defendants’ state of mind, it must also be excluded under Rule 704. See FRE
`704(b) (“In a criminal case, an expert witness must not state an opinion about
`whether the defendant did or did not have a mental state or condition that constitutes
`an element of the crime charged or of a defense.”); United States v. Bohonus, 628
`F.2d 1167, 1172 (9th Cir. 1980) (in wire fraud cases, “there is no fraudulent scheme
`without specific intent”).
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`8
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`for it to be substantially outweighed by the dangers identified in the rule.” United
`States v. Rewald, 889 F.2d 836, 853 (9th Cir. 1989).
`Here, the probative value of the Nortel Transaction is vanishingly low and—
`even if the government were able to prove each of the predicate facts for its
`relevancy to Defendants’ state of mind when acquiring IP addresses from GetAds—
`would be unduly prejudicial if offered for that purpose. The Nortel Transaction is a
`single, third-party transaction with no ties to the facts alleged in the Indictment or to
`Company A’s email marketing business. Yet, jurors might falsely impute
`knowledge of this transaction, and a purported understanding of the $11-per-IP price
`as an objective market valuation, simply based on Microsoft’s size, name
`recognition, and overall influence in the tech industry. Furthermore, Company A is
`a California-based email marketing company, not a multinational behemoth like
`Microsoft. Because it operates in a different sector of the economy, and has far
`fewer resources, its commercial activities are not comparable to those of a Fortune
`20 company.
`IV. CONCLUSION
`Defendants’ Motion in Limine No. 3 should be granted.
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`Dated: March 24, 2022
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`Dated: March 24, 2022
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`Respectfully submitted,
` BIRD, MARELLA, BOXER, WOLPERT,
`NESSIM, DROOKS, LINCENBERG &
`RHOW, P.C.
` By: s/ Gary S. Lincenberg
`Gary S. Lincenberg
`Nicole Rodriguez Van Dyk
`Darren L. Patrick
`Alexis A. Wiseley
`Attorneys for Petr Pacas
`
`
`
` WIECHERT, MUNK & GOLDSTEIN, PC
` By: s/ Jessica C. Munk
`Jessica C. Munk
`David W. Wiechert
`Attorneys for Jacob Bychak
`9
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`Dated: March 24, 2022
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`Dated: March 24, 2022
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` BIENERT KATZMAN
`LITTRELL WILLIAMS LLP
` By: s/ Whitney Z. Bernstein
`
`Whitney Z. Bernstein
`Thomas H. Bienert, Jr.
`James D. Riddet
`Carlos A. Nevarez
`Attorneys for Mohammed Abdul Qayyum
`
`
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` MINTZ, LEVIN, COHN, FERRIS,
`GLOVSKY AND POPEO, P.C.
` By: s/ Randy K. Jones
`Randy K. Jones
`Daniel J. Goodrich (Pro Hac)
`Ryan Dougherty (Pro Hac)
`Attorneys for Mark Manoogian
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`10
`DEFENDANTS’ MOTION IN LIMINE NO. 3
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`CERTIFICATION OF AUTHORIZATION TO SIGN SIGNATURE
`The undersigned counsel of record for Defendant Petr Pacas certifies that the
`content of this document is acceptable to each of the Defendants’ counsel whose
`electronic signature appears thereon, and that I have obtained their authorization to
`sign this document on their behalf.
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`s/ Darren L. Patrick
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`Darren L. Patrick
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`DEFENDANTS’ MOTION IN LIMINE NO. 3
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