HOUSE_OVERSIGHT_011408

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townhome, and she said part of it was a loan from Mr. Epstein that had been paid back, and that's going to be years ago, before any of the defamatory allegations arose in this case.

That's my understanding of the factual basis here.

So we can I think deal with that particular issue, you

know, if and when it comes up, but what I'm saying to the

Court -- I mean, the Court and I are on the same pag ela? sale of the townhome, the amount of the sale of the townhome,

you know, what did or didn't happen to the money from the sale

of the townhome, those are all off limits during the liability

phase of the trial.

THE COURT: Well, correct me if I'm wrong. We don't

have any evidence as to what happened to the proceeds of the sale.

MR. PAGLIUCA: We don't.

THE COURT: Oh, okay. MR. PAGLIUCA: There is none.

aid al

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COURT: Okay.

MR. PAGLIUCA: And the notion that this money went

outside of the jurisdiction of the court is pure fiction.

Frankly, unless it went to some country that I'm unfamiliar

with, I think the jurisdiction of this court extends pretty far.

THE COURT: I think that's for another day.

MR. PAGLIUCA: Right.

SOUTHERN DISTRICT REPORTERS, P.C. (212) 805-0300

HOUSE_OVERSIGHT_011408