MEMORANDUM in Opposition by Martin Kao to Restitution Requested by PacMar Technologies — USA v. Kao (Dkt. 172)

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A memorandum in opposition to restitution, filed April 15, 2025 as Document 172 in United States v. Martin Kao, CR. NO. 21-00061 LEK, in the U.S. District Court for the District of Hawaii, with Exhibits A and B and a certificate of service. Kao, through attorney Randall K. Hironaka, opposes PacMar's request for restitution. The memorandum argues that PacMar is not entitled to restitution under 18 U.S.C. § 3663A under Lagos v. United States, and that PacMar was already awarded the same attorney's fees in arbitration, so collateral estoppel applies. It says the restitution requested by the government on behalf of PacMar appears to be $858,933.41, and asks the Court to deny the request in its entirety.

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MIYOSHI & HIRONAKA, LLLC 
Attorneys at Law 
 
RANDALL K. HIRONAKA 
7444 
City Financial Tower 
201 Merchant Street, Suite 2240 
Honolulu, Hawaiʻi  96813 
Telephone: (808) 888-2595 
E-Mail:  randy@808-law.com 
 
Attorneys for Defendant 
MARTIN KAO 
 
 
IN THE UNITED STATES DISTRICT COURT 
 
FOR THE DISTRICT OF HAWAII 
 
UNITED STATES OF AMERICA 
 
 
vs. 
 
MARTIN KAO, 
 
 
 
Defendant. 
 
CR. NO.  21-00061 LEK 
 
MEMORANDUM IN 
OPPOSITION TO RESTITUTION; 
EXHIBITS “A” AND “B”; 
CERTIFICATE OF SERVICE 
 
 
MEMORANDUM IN OPPOSITION TO RESTITUTION 
 
 
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MEMORANDUM IN OPPOSITION TO RESTITUTION 
 
Comes now Martin Kao, by and through his attorney, Randall K. Hironaka, 
and hereby submits the instant memorandum in opposition to Pacmar’s request for 
restitution in the above-captioned matter. 
DATED:   Honolulu, Hawaiʻi, April 15, 2025. 
 
Respectfully submitted, 
 
MIYOSHI & HIRONAKA, LLLC 
Attorneys at Law 
 
 
By: 
/s/ Randall K. Hironaka  
 
 
RANDALL K. HIRONAKA 
 
Attorney for Defendant 
MARTIN KAO 
 
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MEMORANDUM IN OPPOSITION 
 
 
I. 
INTRODUCTION 
 
Mr. Kao opposes PacMar’s request for restitution. There are two main issues 
herein. First, PacMar is not entitled to restitution pursuant to the Mandatory Victim 
Restitution Act1 (“MVRA”) and Lagos v. United States, 138 S.Ct. 1684 (2018). 
Second, even if PacMar is entitled to restitution pursuant to the MVRA, it is 
collaterally estopped from receiving it because it has already been awarded. 
 
II. 
RELEVANT FACTS 
 
On May 6, 2021, Mr. Kao was charged in an eight-count indictment in the 
instant matter. PSR at ¶ 1. He was arrested on September 30, 2020. PSR at ¶ 7. Mr. 
Kao pleaded guilty as charged on September 7, 2022. PSR at ¶ 10. 
Arbitration hearings pursuant to a lawsuit between what is essentially now 
known as PacMar and Mr. Kao occurred over several days during September to 
October 2021. PacMar prevailed and a Final Award was issued, dated November 
23, 2021. See Exhibit “A.” In addition to various damages, PacMar was awarded 
the same attorney’s fees being requested herein, albeit at an amount adjusted by the 
arbitrator for reasonableness. Exhibit “A” at 88-99. 
 
1 
18 U.S.C. § 3663A 
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On April 2, 2025, in an email to counsel for Mr. Kao, the United States 
indicated that, “for purposes of your opposition, you can assume that the 
government adopts the views of PacMar in its February 21, 2025 letter and 
supporting documents (which I previously forwarded to you) and the USPO (as 
stated in the PSR and in [the probation officer’s] August 15, 2024 email attached 
as Exhibit 1 to the PacMar letter).” See Exhibit “B” (PacMar’s February 21, 2025 
letter to AUSA Nolan; USPO’s August 15, 2024 email to PacMar’s counsel; 
invoices from Goodsill Anderson Quinn & Stifel; legal fees, November 8, 2020 
engagement letter and invoices from Buckley LLP; legal fees and invoices from 
Starn O’Toole Marcus & Fisher). In short, the total amount of restitution requested 
by the government on behalf of PacMar appears to be $858,933.41. Exhibit “B” at 
2. 
 
III. 
PURSUANT TO LAGOS V. UNITED STATES, PACMAR IS NOT 
ENTITLED TO RESTITUTION UNDER 18 U.S.C. § 3663A 
 
 
Mr. Kao agrees with the US Probation and Pretrial Services Office’s 
(“PPSO”) assessment that: 
As an initial matter, private investigations, including outside 
attorney’s fees, are not compensable under the MVRA. The [PPSO] 
submits that PacMar’s request for legal fees may be beyond the scope 
of the instant federal investigation. 
 
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PSR at ¶ 66 (citing Lagos v. United States, 138 S.Ct. 1684, 1690 (2018)). In her 
August 15, 2024 email to PacMar’s counsel, the USPO clearly related the 
following: 
In summary, the PPSO is unable to determine the exact restitution 
amount PacMar is entitled to with regard to the $868,090.91 it 
incurred in legal fees paid to respond to and assist the government’s 
case involving the instant offense. 
 
See Exhibit “B” at 5. 
PacMar’s response to the PPSO’s concern was nothing more than 
conclusory statements contained in its February 21, 2025 letter to the AUSA: 
Here, the $868,090.91 in legal fees and costs incurred by PacMar 
were all incurred in responding to subpoenas and requests for 
documents and records by the government in the Criminal Case. 
Exhibit “B” at 2. 
 
As mentioned, only amounts incurred in responding to the Hawaii 
grand jury subpoenas are included in the $845,638.65 figure. Exhibit 
“B” at 3. 
 
Unsurprisingly, in the final PSR, the PPSO concluded as follows: 
Although PacMar highlighted various billed entries to distinguish 
what it believes is compensable, the PPSO is not in a position to 
determine which entries are acceptable, pursuant to Lagos. 
 
PSR at ¶ 66. Ultimately, the PPSO stated: 
The PPSO believes that the government is in the best position to 
determine which fees were incurred as part of the government 
investigation and prosecution in order to be compensable as 
restitution. Should the issue of restitution remain unresolved at 
sentencing, the Court may schedule a restitution hearing for a final 
determination[.] 
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PSR at ¶ 69. Furthermore: 
In summary, the PPSO is unable to determine the exact restitution 
amount PacMar is entitled to with regard to the $868,090.91 it 
incurred in legal fees paid to respond to and assist the government’s 
case involving the instant offense. 
 
PSR at ¶ 72. 
First, Mr. Kao agrees with the PPSO’s initial concern that PacMar’s 
restitution request is not compensable under the Mandatory Victim Restitution Act 
(“MVRA”), pursuant to Lagos. See PSR at ¶ 66. As such, PacMar’s request should 
be denied in its entirety. 
Alternatively, Mr. Kao also agrees with the PPSO’s conclusion that it (and 
therefore, the Court) is unable to determine the exact restitution PacMar might be 
entitled to as a result of “incurring legal fees paid to respond to and assist the 
government’s case involving the instant offense.” As PacMar and the United States 
have not met their burden of proof with respect to the requested restitution, Mr. 
Kao again argues that PacMar’s request should be denied in its entirety. 
 
IV. 
EVEN IF THIS HONORABLE COURT FINDS THAT PACMAR IS 
ENTITLED TO THE REQUESTED RESTITUTION, IT HAS ALREADY 
BEEN AWARDED THE SAME ATTORNEY’S FEES IT IS 
REQUESTING HEREIN AND IS THUS COLLATERALLY ESTOPPED 
FROM RECEIVING IT AS RESTITUTION 
 
 
In United States v. Edwards, 595 F.3d 1004 (2010), the Ninth Circuit 
explained that: 
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[C]ollateral estoppel applies only where it is established that (1) the 
issue necessarily decided at the previous proceeding is identical to the 
one which is sought to be relitigated; (2) the first proceeding ended 
with a final judgment on the merits; and (3) the party against whom 
collateral estoppel is asserted was a party or in privity with a party at 
the first proceeding. 
 
Edwards at 1012 (citing Hydranautics v. FilmTec Corp., 204 F.3d 880, 885 (9th 
Cir.2000) (internal quotations omitted). The Ninth Circuit also stated that “[t]he 
party asserting preclusion bears the burden of showing with clarity and certainty 
what was determined by the prior judgment.” Offshore Sportswear, Inc. v. Vuarnet 
Int’l, B.V., 114 F.3d 848, 850 (9th Cir.1997). 
Here, Mr. Kao argues that collateral estoppel applies to prevent the district 
court from ordering restitution. Specifically, the issue necessarily decided at the 
previous proceeding is identical to the one sought to be relitigated. Because the 
arbitration resolved the issue of attorney’s fees compensation to his “victims,” 
including PacMar, relitigation of that issue via a restitution award in this 
subsequent criminal proceeding is thus prohibited. 
The simple fact is that the issue of PacMar’s (arguably) compensable 
attorney’s fees has not only been litigated, it has already been awarded. Principles 
of collateral estoppel should be applied by this Court in denying PacMar’s request 
for restitution in its entirety. 
// 
// 
 
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V. 
CONCLUSION 
 
For the foregoing reasons and authority cited, Mr. Kao respectfully requests 
that this Honorable Court deny Pacmar’s request for restitution in its entirety. 
DATED:   Honolulu, Hawaiʻi, April 15, 2025. 
 
Respectfully submitted, 
 
MIYOSHI & HIRONAKA, LLLC 
Attorneys at Law 
 
 
By: 
/s/ Randall K. Hironaka  
 
 
RANDALL K. HIRONAKA 
 
Attorney for Defendant 
MARTIN KAO 
Case 1:21-cr-00061-LEK     Document 172     Filed 04/15/25     Page 8 of 8  PageID.1511

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