UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA MARTIN A. ARMSTRONG Appellant ee No 09 - 1260 SECURITIES EXCHANGE COMMISSTON Appellee SUPPLEMENT TO THE BRIEF ON APPEAL DUE TO RECENT CASES REGARDING A CHANGE IN LAW Martin A. Armstrong #12518-050 FCI Fort Dix Camp PO Box 2000 Dated: _November 29th, 2010 Fort Dix, NJ 08640 FILED PURSUANT TO HOUSTON V LACK 487 US 266 (1988)SUPPLEMENT TO THE BRIEF SUBMITTED DUE TO DEVELOPMENTS IN THE CHANGE IN LA IN THE WAKE OF THE MORRISON DECISTON I, Martin A. Armstrong pro se, (herein “Armstrong"), hereby respectfully nove to supplement the previous submitted brief in light of further development regarding the international application of United States law to overseas actions in Light of Morrison v National Australian Bank, 561 US ~ , 130 SCt 2869, 177 Led? 535, 2010 US Lexis 5257 (June 24, 2010). ‘The Securities and Exchange Commission (herein "SEC") relied upon a criminal plea to only Conspiracy to commit Securities, Commodities, and Wire Fraud. ‘The SEC will no doubt try to claim that the validity of such a plea cannot be now challenged. This appeal is a facial attack upon the abuse to extend United States law outside the United States and is thus jurisdictional. When "attacks are juris~ dictional in nature [they] survive a valid guilty plea." US v Seay, 2010 US App LEXIS 18738, *1°(9/8/10); citing: US v Morgan, 230 F3d 1067, 1071 (8th Cir 2000), "[T]his Circuit and others have indicated that a guilty plea does not preclude a defendant from claiming that the statute under which he pleaded is unconstitutional.” Sodders v Parratt, 693 F2d 811, 812 (8th Cir 1982), relied upon by Seay, 2010 US App LEXIS at 18738, *1} (collecting circuits decisions). Furthermore, the Supreme Court held this distinction very clear that this is a claim that does not rest on some procedural error where some rule can be cited to defeat a constitutional right. This is a claim that the government “may not constitutionally prosecute" Armstrong, Menna_v New York, 423 US 61, 62 n.2,(1975)(per curiam). ‘The SEC cannot rely upon any rule to defeat this appeal. "[NJo rule of court can enlarge or restrict the jurisdiction of the court, nor can it abrogate or modify the substantive law." Washington So Nay Co v Baltimore & PSB & Co, 263 US 629, 635 (1924), Any rule the SEC cites to defeat this appeal is frivolous for no rule can “contravene[] the statute for the Constitution for it would have] no force." Alaska 1Packers Asso v Pillsbury, 301 US 174, 177 (1937), No constitutional command may be "defeated under the name of local practice." Davis v Wechsler, 263 US 22, 24 (1923). "A rule of practice must not be allowed for any technical reason to prevail over a constitutional right.” Agnello v US, 269 US 20, 34-35 (1925), Above all, any claim that somehow this court lacks any jurisdiction whatsoever to hear a constitutional claim is without merit for no rule may ever “work injustice, nor deprive the accused of any substantial right." Kirby v US, 174 US 47, 64 (1899), "[T]here can be no rule making or legislation which would abrogate" a constitutional right, Miranda v Arizona, 384 US 436, 490 (1966). ‘Any claim that somehow any jurisdiction would lie in New York, not in this Circuit, is absurd when challenging the constitutionality of the very power claimed to prosecute, for this goes directly to a STRUCTURAL RIGHT under Article III, The Supreme Court has recently established clear reasoning that those rights enumerated directly within the Constitution, rather than the later Bill of Rights, are STRUCTURAL and cannot be mitigated, circumvented, nor legislated away by éven Congress such as the Suspension Clause regarding habeas corpus, Boumediene v Bush, 548 US ~ (2008). If the SEC went to Hawaii, obtained a judgment, Armstrong was never there in Hawaii, they cannot rely upon such a judgment that even lacked VENUE. That is precisely what has taken place in the case at bar. For during the criminal plea, the district court noticed this problem and expressly asked what took place in New York. The only thing Armstrong could think of was he traded futures on a New York exchange, but that trading was unrelated to the claimed offense for'it was proprietary and was not the property of any noteholder. (see brief at 5). Consequently, this issue is that nothing took place in the United States. Any solicitation was in Japan and the very plea the SEC relied upon made that perfectly clear: ARMSTRONG: Among the things that were represented to investors by my agents in Japan on my behalf and with my knowledge when the investments were solicited ... (SDNY 99-Cr-997)(Tr; 8/17/06, p20, L7-14)‘The Morrison decision has made it crystal clear that there had to have been a solicitation in the United States or listed American securities to which NEITHER are present. Rule §10(b)(5) and section §10(b) of the security act applies: “only ... [1] the purchase or sale of a security listed on an American stock exchange, and [2] the purchase or sale of any other security in the United States." Morrison, 130 Sct at 2888 Directly within the civil cases, it was there also admittéd by the government that even the CFIC stated their allegation were concerned “after the notes were solicited in Japan: So our focus is on what happened to the money after it got to the United States." (SDNY 99-Civ-9667; 9669)(Tr; 10/14/99, p33, L6-14), As the Morrison decision has filtered into the American Jurisprudence, it has made it very clear that it applies to AUL statutes, for the Morrison Court has made it perfectly clear that its prior holding that confines American legislation to the territory of the United States have been ignored. "Congress generally legislated with domestic concerns in mind." Small v US, 544 US 385 (2005). "IT]t is a longstanding principle of American law 'that legislation of Congress, unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United States." BBOG v Arabian American Oil Co, 499 US 244, 248 (1991); Smith v US, 507 US 197, n.5 (1993). “Morrison states that §10(b) applies to securities transactions in the United States or Transactions involving securities listed on an American Exchange." SEC v Credit Bankcorp, Ltd., 99-Civ-11395 (9/28/2010). Previously, if Americans had even purchased foreign securities on a foreign exchange, courts were applying US law. ‘This was absurd, for if @ foreign investor bought a stock of the New York Stock Exchange and another country makes a law declaring it is a crime in some way, then the foreign investor could trump US law by prosecuting the American broker in his country. This has now also been overruled relying on Morrison for an American now purchasing a European stock in London cannot export US law to that transaction togein an advantage, Cornwell v Credit Suisse Group, No: 08-Civ~3758, 2010 US Dist LEXIS 76543, 210 3069597 (SDNY July 27, 2010). In effect, the SEC is abusing its power to invade Japan and overrule their entire domestic right to regulate their own territory by charging Armstrong for owning a Japanese broker-dealer, engaging in regulated business in Japan where each and every note required individual Japanese approval by the Ministry of Finance ("MOF"), This would be no different than Japon invading the United States and charging Goldman Sachs for selling mortgage back securities to another Anerican firm in New York and claim it somehow offends their law in Tokyo. This action in the case at bar must be struck down by this Court for it will lead not merely to unconstitutional results, but complete international chaos. Any counrty could now charge Americans in their home states alleging what they did in New York offended their economies and caused a CONTAGION that bankrupted their people such as in Ireland. This will lead to a complete breakdown in international law unless this Court strikes this judgment down resoundingly under Morrison. Furthermore, it is now clear that with the record showing that both in the criminal plea and the civil.actions ALL solicitation took place in Japan through private meetings in Japan by the broker-dealer, for Armstrong did not even plead to making the solicitations personally since he did not speak Japanese and the company employed over 200 people. This is why the government had Armstrong state it was "wy agents in Japan on my behalf and with my knowledge when the investments were solicited." (SDNY 99-Cr-997)(Tr; 8/17/06, p20, L7-14). Where all the activity related to the sale of a security takes place offshore, it is clear there is no Jurisdiction under §10(b) of the Securities Exchange Act, In re Banco Stander Sec~ Optimal Litigation, 2010 WL 3036990 at *5-7 (SD Fla July 20, 2010). The scope and application of Morrison in confining ALL legislation to the USA domestic territory, was applied by Judge Rakoff of the SDNY in dismissing the attempt to apply RICO outside the USA holding that the enterprise must be inside the USAunder Morrison pursuant to his holding in Eligio Cedeno et al v Intech Group, Inc, 2010 US Dist LEXIS 88026 August 25, 2010). The SEC has relied upon the criminal plea to purely a CONSPIRACY. Such a crime is NOT extraditeable for it is not a crime in the vast majority of civilized countries. Even Justice Holmes once warned that if the day ever came when conspiracy was charged for every crime, it would be an abuse of that statute. A challenge to jurisdiction is not relitigating the merits, Kasap v Folger Nolan Fleming & Douglas, 166 F3d 1243 (DC Cir 1999). Conspiracy does not and CANNOT apply to acts in Japan in any event any nore than the Securities Act under Morrison, The plain language of 18 USC §371 has no extraterritorial application and cannot do so overturning the las of other nations. 18-USC $371 IE two or more persons conspire either to commit any offense against the United States, or to defraud the United States, or any agency thereof in any manner or for any purpose, and one or more of such persons do any act to effect the object of the conspiracy, each shall be fined under this title or imprisoned not more than five years, or both. The act for conspiracy MUST take place in America with a second person. Here, Armstrong stated any solicitation was by "my agents" in Japan. The SEC is trying to create a murder case claiming a bullet is bought in America although used in Japan. As in RICO, there MUST be an enterprise in USA, there MUST be two person in USA committing the act of conspiracy. That does not exist in the case at bar. The wire fraud mentioned in the Morrison decision made it clear that the acts took place in the United States to buy the product for Canada. In the instant case, the notes were sold in Japan. The Japanese yen was given to the Japanese broker-dealer completing the transactions, who then converted the yen to dollars and wired the funds to Philadelphia where the PROPRIRTARY accounts resided, not even New York, Again, there was no solicitation in the United States and not even a phone call to 4 noteholder from the United States since all solicitations were in Japan as stated in the plea by Armstrong's agents at private meetings. Even the criminal complaint stated the noteswere unsecured and the majority of the notes were simply book entries and never even issued, They were in "street name" at the broker-dealer in Japan confirming that the transactions were complete in Japan, SSc Criminal Complaint. As for the commodity fraud, there is NO contract ever issued soliciting any investment in conmodity futures trading in the United States. The government has conceded that the only contracts were the notes, 5c Criminal Complaint. Tt is black letter law that there can be NO CONSTRUCTIVE CRIMES not even civilly charged under the Commodity Exchange Act. There MUST be a direct solicitation to invest in commodities, Tatum v Legg Nason Wood Walker, Inc, 83 F34 121, 122-123 (Sth Cir 1996) (collecting cases). The can be no crime of Commodities Fraud by soliciting to borrow yen at fixed rates of interest or to purchase pre-existing portfolios of “Japanese stocks. The criminal plea even had Armstrong state "I conducted that trading [in] ... accounts I opened and which were maintained at Republic New York Securities based in New York City." (SDNY 99-Cr-997)(Tr; 8/17/07, p19~20). There was no such contracts to open commodity trading accounts and this allegation was purely a constructive crime. ‘The commodity exchange Act is interpreted the sane as the Securities Exchange Act and there must be a solicitation "in connection with" trading futures, Kearney y Prudential-Bache Securities, 701 FSupp 416, 424 (SDNY 1988). The noteholder MUST have been a party to trading futures to meet the "in connection with" requirement of 7 USC 86d(a), Crumere v Smith Barbey Harris Ypham Co, 624 FSupp 751, 755 (SDNY 1985)(holding any misrepresentations alleged must he related to that which is being traded). This is a principle further elaborated by the Supreme Court holding that the misrepresentation but directly lead to the "loss causation" Dura Pharm. Inc v Broudo, 544 US 336 (2005), When even the majority of the notes remained as book entries at the Japanese broker-dealer in Japan and were not actually issued to the claimed noteholder, the lack of any contracts to invest in any commodity Futures 6or listed American securities, and that NO solicitation took place in the United States and no note COULD HAVE BERN issued sua sponte anywhere in the world for the Japanese government restricted such issuing of notes with individual approval by MOF, there can be no crime in the United States in light of Morrison or any valid plea upon which the SEC can hang their hat. CONCLUSION Armstrong respectfully submits that Morrison is conclusive in this matter. There is no crime, nor could. there ever have been such a crime, and thus this Court should strike down all judgments for this is a structural issue under Article IIT that cannot be played with or shifted around bouncing from court to court to buy time and maintain the prejudice against Armstrong. The SEC has stripped Armstrong of counsel forcing him to remain pro se. They have insisted that he remain in prison for 12 years on a statutory maximum offense of 5 years, all to prevent him from accessing discovery ond getting hold of documents that are clearly now Brady v Maryland, 373 US 83 (1963) material to demonstrate the NOF approvals, that the SEC had the receiver issue the notes to the book-entries AFTER the case began, and entered a Memorandum of Agreement directing a court officer to imprison Armstrong indefinitely on a bogus contempt where there was NO secured title to any assets belonging té any third party denying and circumventing Armstrong's STRUCTURAL right to trial by jury secured :by Article III, Sixth, and Seventh Amendment, Grupo Mexicano v Alliance Bond, Fund, 517 US 308 (1999), The SEC knew that its pretended claims of "disgorgenent™ did not exist in 1789 and that there was ONLY one equitable remedy, RESTITUTION. They knew that once RESTITUTION was codified as a criminal penalty, they could NOT in any way use equity to strip Armstrong of his liberty claiming civil contempt when the Supreme Court made it clear "such an action [for disgorgement] is a remedy only for restitution — a more limited for, of penalty than a civil fin Tall _v US, 481 US 412, 424 (1987), all post-indictment circumventing his right to trial by jury and 7thereby obstructing the administration of justice in the criminal proceeding further eliminating the Federal Rules of Criminal Procedure and any force that they had. They also eliminated the entire adversarial. system of justice that was codified as 18 USC §3481 demanding Armstrong be thrown in contempt to testify and produce evidence that was directly pending in the criminal proceeding. The SEC set out to repeal the enitre constitution and successfully accomplished that goal as evidenced in the case at bar. ‘The Constitution was NEGATIVE and was to restrain the government, Harris v McRae; 448 US'297 (1980). They have turned it on its head, and shifted the entire burden to prove Armstrong has any rights whatsoever. ‘The SEC is fully aware of its actions. Tt has kept Armstrong in prison not merely denying him access to discovery by placing it on computer CD-ROMS knowing the Bureau of Prison refuses to allow Armstrong to print out any discovery to present to this Court obstructing once again the Administration of Justice and the First Amendment right to petition the courts. However, it is also aware that Armstrong has been ill and the Bureau of Prison has refused medical attention. Armstrong is being turned into a criple with his muscles being attackéd and he has been going blind since April fighting with the prison to get medical attention. Finally, on November 17th, 2010, an outside doctor Patel came in and was very concerned that the pressure in Armstrong eyes is dangerous, suggesting he must have eye surgery, and could have glaucoma. For months Armstrong has desperately tried to get bail and medial attention to noavail. This false imprisonment by the SEC is turning into a death sentence by deliberate indifference and in retaliation for Armstrong efforts to be heard for once in court before the whole eyes of the world to see just how Americans are being treated by the SEC.