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MEMORANDUM in Opposition by Martin Kao to Restitution Requested by… — PPP Attempt Conspiracy Legal Filings (Dkt. 172)
No. 1:21-cr-00061-LEK · Doc. 172 · Docket on CourtListener
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A Memorandum in Opposition to Restitution filed April 15, 2025 as Document 172 in United States v. Martin Kao, No. 1:21-cr-00061-LEK, in the U.S. District Court for the District of Hawaii, by defense attorney Randall K. Hironaka. The defendant opposes PacMar's request for restitution, which the memorandum states appears to total $858,933.41. It argues first that PacMar's legal fees are not compensable under the Mandatory Victim Restitution Act, 18 U.S.C. § 3663A, and Lagos v. United States, 138 S.Ct. 1684 (2018). It argues in the alternative that PacMar is collaterally estopped because an arbitration Final Award dated November 23, 2021 already awarded it the same attorney's fees, citing United States v. Edwards, 595 F.3d 1004 (2010). The eight-page memorandum lists Exhibits A and B and asks the court to deny the request in its entirety.
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Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 1 of 8 PageID.1504
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 CR. NO. 21-00061 LEK
vs. MEMORANDUM IN
OPPOSITION TO RESTITUTION;
MARTIN KAO, EXHIBITS “A” AND “B”;
CERTIFICATE OF SERVICE
Defendant.
MEMORANDUM IN OPPOSITION TO RESTITUTION
Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 2 of 8 PageID.1505
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
2
Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 3 of 8 PageID.1506
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
3
Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 4 of 8 PageID.1507
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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Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 5 of 8 PageID.1508
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[.]
5
Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 6 of 8 PageID.1509
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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Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 7 of 8 PageID.1510
[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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Case 1:21-cr-00061-LEK Document 172 Filed 04/15/25 Page 8 of 8 PageID.1511
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
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