RESPONSE in Support by Pacmar Technologies LLC as to Martin Kao re 82 MOTION for Return of… — USA v. Kao (Dkt. 90)

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A reply in support of a motion for return of property under Rule 41(g) of the Federal Rules of Criminal Procedure, filed February 10, 2023 as Document 90 in United States v. Martin Kao, CR. NO. 21-00061 LEK, in the U.S. District Court for the District of Hawaii. It is filed by movant PacMar Technologies LLC f/k/a Martin Defense Group, LLC f/k/a Navatek LLC, and answers the Memorandum in Opposition filed by Defendant Kao. PacMar argues that it bought and paid for the company cellphone and its service plan, that Kao had no reasonable expectation of privacy, and that Kao has no colorable Fifth Amendment claim. It asks that the Motion be granted and an order issued directing return of PacMar's data from the phone. The signature block names David M. Louie and Jesse W. Schiel, with /s/ Jesse W. Schiel.

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KOBAYASHI SUGITA & GODA, LLP 
DAVID M. LOUIE 
 
2162 
JESSE W. SCHIEL 
 
7995 
First Hawaiian Center 
999 Bishop Street, Suite 2600 
Honolulu, Hawaii 96813 
Telephone: (808) 535-5700 
Facsimile: (808) 535-5799 
E-mail: 
dml@ksglaw.com; 
jws@ksglaw.com 
 
Attorneys for Movant 
PACMAR TECHNOLOGIES LLC f/k/a 
MARTIN DEFENSE GROUP, LLC f/k/a 
NAVATEK LLC 
 
IN THE UNITED STATES DISTRICT COURT 
 
FOR THE DISTRICT OF HAWAII 
 
UNITED STATES OF AMERICA, 
 
 
 
Plaintiff, 
 
 
vs. 
 
MARTIN KAO, 
 
 
 
Defendant. 
CR. NO. 21-00061 LEK 
 
REPLY IN SUPPORT OF MOTION 
FOR RETURN OF PROPERTY 
PURSUANT TO RULE 41(G) OF 
THE FEDERAL RULES OF 
CRIMINAL PROCEDURE; 
SUPPLEMENTAL DECLARATION 
OF JAMES TOSHIZO OTA; 
CERTIFICATE OF SERVICE 
 
REPLY IN SUPPORT OF MOTION FOR RETURN OF PROPERTY 
PURSUANT TO RULE 41(G) OF THE FEDERAL RULES OF 
CRIMINAL PROCEDURE 
Defendant Kao’s Memorandum in Opposition [Dkt. No. 89] (“MIO”) is 
fraught with attempts to mischaracterize PacMar’s request for the return of its 
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property which is in the possession of the DOJ, while raising no actual or credible 
objections to the return of such property.1  Defendant Kao raises only hypothetical 
and speculative objections based on these mischaracterizations and attempts to 
mislead the Court on the applicable standards of law relevant to this Motion.  
Contrary to Defendant Kao’s unsupported allegations of fact, PacMar owned the 
cellphone in question and retained the right to monitor and inspect the cellphone at 
any time.  Contrary to Defendant Kao’s misplaced assertions of law, PacMar is 
neither a government entity seeking to investigate the cellphone nor is it requesting 
access to unknown information in the DOJ’s possession.  PacMar is simply seeking 
the return of its own property—that is it.  For the reasons explained in greater detail 
below, Defendant Kao’s arguments fail and the Court should grant the Motion. 
I. 
PacMar Owns Defendant Kao’s Company Cellphone and Defendant 
Kao had No Reasonable Expectation of Privacy for Data on His 
Company Cellphone. 
As admitted to by Defendant Kao in his MIO, PacMar bought and paid for 
both the Company Cellphone and the ongoing service plan with Verizon.  See MIO 
at 13; Exhibit 5 to Motion at 2.  Defendant Kao would have the Court ignore this 
fact, and argues instead that he “had possession and use of the phone.”  MIO at 13.  
However, Defendant Kao had the possession and use of the cellphone because it was 
                                           
1 All references and short titles used herein are the same as those used and identified 
in PacMar’s Motion. 
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issued to him by PacMar, subject to the conditions and restrictions on use set forth 
in PacMar’s Information System Security Policies and Procedures Manual and 
Employee Mobile Device Policy.  See Exhibits 3 and 4 to Motion.  Under these 
policies, PacMar retained a right to “monitor equipment, systems, and network 
traffic at any time . . . .”  Exhibit 3 to Motion at 8.  Defendant Kao therefore had no 
reasonable expectation of privacy for the data on his Company Cellphone, as PacMar 
had, at all times, a right to monitor and inspect such data to ensure proper use of the 
cellphone in furtherance of its business operations and security policies.2  See City 
of Ontario, Cal. v. Quon, 560 U.S. 746 (2010) (“Even if he could assume some level 
of privacy would inhere in his messages, it would not have been reasonable for [the 
employee] to conclude that his messages were in all circumstances immune from 
scrutiny.”); accord Mintz v. Mark Bartelstein & Associates, Inc., 885 F. Supp. 2d 
987, 1000 (C.D. Cal. 2012) (explaining “the Supreme Court found [in Quon] that 
the employee ‘had only a limited expectation’ of privacy in the text messages” but 
not in the other data associated with an employer-owned cellphone).3 
                                           
2 PacMar, as a federal contractor, is in fact under a heightened duty to maintain the 
security of its information and equipment, beyond that of a typical private-sector 
employer.  See Ota Supp. Decl. ¶ 6. 
3 Defendant Kao also suggests that his relinquishment of the cellphone to the DOJ 
was voluntary, see MIO at 13 (“It is believed Mr. Kao cooperated with the US.”), 
further eroding any claims of an expectation of privacy in the cellphone and its data. 
See United States v. Wahchumwah, 710 F.3d 862, 867 (9th Cir. 2013) (“[A] 
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Defendant Kao also argues, without merit or any supporting evidence or 
authority, that the DOJ treated the Company Cellphone as his property when it was 
seized during his arrest.  See MIO at 13.  This is untrue.  PacMar’s communications 
with the DOJ, the DOJ’s Response to this Motion [Dkt. No. 84], and the prior 
conduct of the DOJ in returning PacMar’s other property seized at the time of 
Defendant Kao’s arrest all belie these claims.  See, e.g., Exhibit 9 to Motion 
(suggesting that PacMar file a motion for return of property in order to recover the 
data in question).  Just as the DOJ returned PacMar’s servers to it following the arrest 
of Defendant Kao, see Supplemental Declaration of James Toshizo Ota (“Ota Supp. 
Decl.”) ¶ 5, which server included all of its employees’ data and correspondences 
stored on it, so now is PacMar simply seeking the DOJ’s return of its Company 
Cellphone.4  PacMar’s servers and company cellphones are both company property 
and, as it did with PacMar’s server, the DOJ is prepared to return the Company 
Cellphone data to PacMar.5 
                                           
defendant generally has no privacy interest in that which he voluntarily reveals to a 
government agent.”). 
4 PacMar would be entitled to the return of the physical cellphone and all of its 
contents if not for the DOJ’s stated position that the cellphone is being kept for use 
as evidence in further potential criminal matters. 
5 PacMar’s policies treat all company-issued equipment, including computers, 
servers, accounts, and cellphones in the same way.  See Exhibit 3 to Motion at 7 
(“Martin Defense Group sensitive information stored on electronic and computing 
devices whether owned or leased by Martin Defense Group, a User, or a third party, 
remains the sole property of Martin Defense Group.”). 
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II. 
Defendant Kao Has No Colorable Claim to Fifth Amendment Privilege 
or Other Constitutional Protections. 
Defendant Kao states in his MIO that he is unable to testify as to any claims 
of privacy he may have over the data on the Company Cellphone (which, as 
explained above, he does not have) due to self-incrimination protections under the 
Fifth Amendment and similar state-level protections.  It must be noted, however, 
that the DOJ already has in its possession the Company Cellphone and all data stored 
therein.  As such, there is no possible threat of self-incrimination for any data stored 
on his Company Cellphone.  Any incriminating evidence is already subject to use 
by the DOJ in the multiple criminal charges Defendant Kao is facing.  Moreover, 
because Defendant Kao had no reasonable expectation of privacy on a company-
issued device, see Discussion, supra § I, no testimony is required on his part as to 
“his history relating to cellphone use at the company; his recollection regarding the 
documents produced by Pacmar; his history relating to cell phone and the phone 
number; the reasons for any text message; his personal and business contacts; and 
other matters that may implicate the privilege against self-incrimination.”  MIO at 
8. 
Defendant Kao also attempts to force inapplicable standards into the Court’s 
analysis, stating “Cellphone data is typically obtained only through a search 
warrant.”  MIO at 12.  PacMar is not a governmental entity, and therefore does not 
require a warrant to recover data and information on its own property, much less the 
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ability to obtain one.  Defendant Kao’s cited caselaw makes this point clear: “Our 
answer to the question of what police must do before searching a cell phone seized 
incident to an arrest is accordingly simple—get a warrant.”  MIO at 12 (emphasis 
added) (quoting Riley v. California, 573 U.S. 373, 403 (2014)). 
Nor is PacMar’s request for the return of its own property akin to a FOIA 
request as Defendant Kao argues in his MIO at 9–10.  Contrary to Defendant Kao’s 
baseless statements, PacMar is indeed “seeking records on itself,” insofar as the data 
stored on the Company Cellphone is PacMar’s own property and was, at all times, 
subject to PacMar’s monitoring, inspection, and requests for return.  See Exhibit 3 
to Motion at 8 (“For security and network maintenance purposes, Designated IT 
Personnel will monitor equipment, systems, and network traffic at any time, per 
Martin Defense Group’s Monitoring and Systems/Communications Protection 
Policy.”). 
Defendant Kao further argues that PacMar’s suggestion that the data be turned 
over via a Cellebrite report somehow converts the data from PacMar’s property into 
the “product of a criminal investigation.”  MIO at 11.  Again, despite Defendant 
Kao’s mischaracterization of PacMar’s request for return of property (as is proper 
under Rule 41(g), see Motion at 6–7 (citing United States v. Comprehensive Drug 
Testing, Inc., 621 F.3d 1162, 1172 (9th Cir. 2010), overruled on other grounds in 
Demaree v. Pederson, 887 F.3d 870 (9th Cir. 2018) (per curiam)), the data itself is 
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PacMar’s property, and not the product of the DOJ’s investigation into Defendant 
Kao’s criminal conduct.  The reference to a Cellebrite report was made only on the 
understanding that the data is portable in that form for return to PacMar by the DOJ. 
III. 
Defendant Kao Raises No Meaningful Objections to the Return of the 
Company Cellphone to PacMar. 
Beyond effectively ignoring the fact that PacMar bought, paid for, and owns 
the Company Cellphone and has a right to a return of the data stored therein, and his 
attempts to inject inapplicable caselaw into his arguments, Defendant Kao raises 
only vague assertions that the evidence presented by PacMar is somehow deficient.  
Defendant Kao does not raise any specific objections and does not directly dispute 
that the Company Cellphone is owned by PacMar.  Instead, Defendant Kao 
selectively quotes irrelevant portions of the PacMar (then Navatek) Employee 
Handbook in a transparent effort to distract the Court from the applicable clauses.  
The relevant language from the Employee Handbook is quoted in PacMar’s Motion 
and is entirely ignored in Defendant Kao’s Opposition.  See Motion at 3 (quoting 
Exhibit 1 to Motion at §§ C-22 and -23). 
Defendant Kao cannot credibly argue that he was not aware of the policies, 
conditions, and restrictions on the use of the Company Cellphone, and certainly not 
as to the applicable company policies from 2018 and on, see Discussion, supra § I, 
when he was the President and CEO of PacMar (then MDG).  See Exhibits 3 and 4 
to Motion.  Defendant Kao was not just a typical employee who may or may not 
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have been aware of company policies.  Indeed, he was the principal executive officer 
of the Company, in charge of supervising and overseeing the development, 
implementation of, and compliance with said policies.  See Ota Supp. Decl. ¶ 7.  
Defendant Kao’s attempts to misdirect the Court’s analysis ring hollow and should 
be rejected. 
IV. 
Conclusion 
For the foregoing reasons, as well as any further adduced at the hearing on 
this matter, the Motion should be granted and an order issued directing the return of 
PacMar’s data from Defendant Kao’s Company Cellphone. 
DATED: Honolulu, Hawaii, February 10, 2023. 
/s/ Jesse W. Schiel 
DAVID M. LOUIE 
JESSE W. SCHIEL 
 
Attorneys for Movant 
PACMAR TECHNOLOGIES LLC 
f/k/a MARTIN DEFENSE GROUP, 
LLC f/k/a NAVATEK LLC 
Case 1:21-cr-00061-LEK     Document 90     Filed 02/10/23     Page 8 of 8  PageID.524

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