HKSAR v. SHAWN HANNA

CACC 26/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CRIMINAL APPEAL CASE NO 26 OF 2012

(on appeal from DCCC 918 of 2011)

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DECISION

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1.  This is an application for bail pending appeal. The Applicant Shawn Hanna was charged with an offence of conspiracy to defraud in relation to a company called SOLAZYMEPE Bio Engineering Co Ltd (“SOLAZYMEPE”).

2.  The prosecution case was that SOLAZYMEPE was set up in Hong Kong in 2010.  It was represented as a subsidiary of a United States company, SOLAZYME (“the US company”), and that it was authorised to attract financing from private equity.  Under the proposed scheme, the investors would acquire shares in the US company.  In fact, SOLAZYMEPE had no relationship with the US company, and actors had been hired to play the parts of its officers, as well as government officials and journalists, at a press conference held by SOLAZYMEPE in February 2011. 

3.  Some members of the public were interested and paid money to SOLAZYMEPE.     

4.  SOLAZYMEPE had a number of staff working from an office in Concordia Plaza.  One of these was the Applicant, who apparently was the manager. 

5.  In May 2011, about 3 months after the press conference, the US company sent an email in reply to an enquiry from some of the staff. The email stated that the US company had no relationship with SOLAZYMEPE and that the scheme here was “a scam” (“the US company email”).  By the end of May, most of the staff left.

6.  The Applicant was made aware of the US company email in May 2011 but continued to work at the Concordia Plaza office.  He set up a company called Webs Private Equity (“WPE”) there.  He was a 10% shareholder in WPE.  According to the prosecution, this was a continuation of the same fraud, using WPE as a conduit. Investors in SOLAZYMEPE were to be invited to invest in WPE and thereby to acquire shares in the US company.

7.  In particular the prosecution pointed to the fact that even after the US company email had been drawn to the Applicant’s attention, he continued to arrange another press conference using the corporate identity of SOLAZYMEPE but changing the name to WPE.  There was also an email on the Applicant’s laptop reminding him to hire the same actors to play the roles of officers of the company.       

8.  At trial, a number of witnesses gave evidence, either by way of statement, or orally.  The Applicant was legally represented and did not ask for the deponents to be cross-examined.  He gave evidence to the effect that he had set up WPE as a separate organization from SOLAZYMEPE.  He claimed it was pure coincidence that the WPE press conference was fixed for the same date advertised by SOLAZYMEPE for their press conference.   

9.  On 23 December  2011 Deputy Judge Casewell found the Applicant guilty as charged.  Detailed reasons were given in writing and I will not repeat them here. 

10.  On 10 January 2012 the Applicant was sentenced to a term of imprisonment of 39 months. 

11.  The Applicant was given leave to appeal against conviction and sentence by Hartmann JA on 8 May 2012. The appeal will be heard on 18 October 2012, i.e. in less than 2 months time.

12.  The court has an unfettered discretion in deciding whether to grant bail pending appeal.  It is usually only granted where it appears prima facie that the appeal is likely to be successful.  But where the sentence is short, such that there is a risk that the sentence will have been served by the time the appeal is heard, the court will consider if the appeal is reasonably arguable.  If it is not, then the appeal would be pointless, and there is no reason why bail should be granted pending a pointless appeal however short the sentence.

13.  I have read the Applicant’s grounds of appeal against conviction and heard his submissions to see if he has shown that prima facie his appeal is likely to succeed.

14.  The trial judge, having heard the Applicant in the witness box and considered all the evidence, gave cogent reasons for inferring that the Applicant was involved in the SOLAZYMEPE scheme. 

15.  After the Applicant was shown the US company email by other members of staff of SOLAZYMEPE, and even after the letter purporting to be from the US company which he himself accepted was clearly a forgery, he carried on working at the Concordia Plaza office, instead of distancing himself from it. 

16.  In June 2011 he said in an email that SOLAZYMEPE was “changing our name to [WPE]”, the company in which he had a 10% share and which he was involved in setting up.  The Applicant claims that he merely needed some corporate details as he had none for WPE.  Yet he chose to use the corporate identity of SOLAZYMEPE, a company which (if he was innocent) one would expect him to keep the furthest distance from. 

17.  Further, for the event in July 2011 there were communications in his computer about hiring the same actors to play the roles of the company’s officers as at the February 2011 SOLAZYMEPE press conference. 

18.  In the light of all these matters, I am not persuaded that the Applicant has shown prima facie that his appeal is likely to succeed.  His application is dismissed.