Asia Economic Institute et al v. Xcentric Ventures LLC et al

Filing 125

DECLARATION of Daniel F. Blackert in support of MOTION for Reconsideration re Order,, 94 118 filed by Plaintiffs Asia Economic Institute, Iliana Llaneras, Raymond Mobrez. (Attachments: # 1 Exhibit 1 (Declaration of Kent Hutcherson, Esq.), # 2 Exhibit 2 (May 15, 2010 Settlement Agreement), # 3 Exhibit 3 (July 28, 2010 takedown letter), # 4 Exhibit 4 (Agust 3, 2010 email), # 5 Exhibit 5 (August 6, 2010 Ripoff Report), # 6 Exhibit 6 (July 14, 2010 Declaration of David Gingras), # 7 Exhibit 7 (Attachment to July 14, 2010 Gingras Declaration))(Blackert, Daniel)

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Asia Economic Institute et al v. Xcentric Ventures LLC et al Doc. 125 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DANIEL F. BLACKERT, ESQ., CSB No. 255021 LISA J. BORODKIN, ESQ. CSB No. 196412 Asia Economic Institute, LLC 11766 Wilshire Blvd., Suite 260 Los Angeles, CA 90025 Telephone (310) 806-3000 Facsimile (310) 826-4448 Attorney for Plaintiffs, Asia Economic Institute, LLC, Raymond Mobrez, and Iliana Llaneras UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA ) ) ) ) ) ) Plaintiffs, ) ) vs. ) ) XCENTRIC VENTURES, LLC, an ) Arizona LLC, d/b/a as BADBUSINESS ) BUREAU and/or ) BADBUSINESSBUREAU.COM ) and/or RIP OFF REPORT and/or ) RIPOFFREPORT.COM; BAD ) BUSINESS BUREAU, LLC, organized ) ) and existing under the laws of St. ) Kitts/Nevis, West Indies; EDWARD MAGEDSON an individual, and DOES ) ) 1 through 100, inclusive, ASIA ECONOMIC INSTITUTE, LLC, a California LLC; RAYMOND MOBREZ an individual; and ILIANA LLANERAS, an individual, Defendants. Case No.: 2:10-cv-01360-SVW-PJW The Honorable Stephen V. Wilson DECLARATION OF DANIEL F. BLACKERT IN SUPPORT OF PLAINTIFFS' MOTION FOR RECONSIDERATION OF ORDER OF JULY 19, 2010 GRANTING PARTIAL SUMMARY JUDGMENT ON PLAINTIFFS RICO CLAIMS PREDICATED ON EXTORTION AND FOR RECONSIDERATION OF ORDER DENYING RELIEF UNDER RULE 56(F) Date: Time: Ctrm: September 20, 2010 1:30 p.m. 6 Declaration of DFB- 1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I, Daniel F. Blackert, declare under penalty of perjury as follows: 1. My name is Daniel Blackert. I am a United States Citizen, a resident of the State of California, am over 18 years of age, and if called to testify in Court or other proceeding I could and would give the following testimony which is based upon my own personal knowledge unless otherwise stated. 2. I am an attorney, licensed to practice law in the State of California. I am an active member and in good standing with the State of California. I am also admitted to practice in the United States District Court for the Central District of California. 3. I have been employed by Asia Economic Institute LLC as their attorney for this matter since December 2009. My Co-Counsel in this case is Lisa J. Borodkin. I have been involved in the litigation since its inception. I have possession of Plaintiffs' files with respect to this case, and I am personally familiar with the contents thereof. 4. On July 20, 2010, my co-counsel Ms. Lisa Borodkin, Plaintiff Mr. Mobrez and I traveled to Jaburg & Wilk in Phoenix, Arizona for the following purposes: (a) to take the deposition of Defendant Edward Magedson and attempt to resolve the case informally, pursuant to what we thought at the time was a voluntary agreement between the parties, and also (b) give Defendants an opportunity to provide their version of new evidence that seemed to lend further support to Plaintiffs' RICO/wire fraud claim. 5. When we arrived at the Law Offices of Jaburg & Wilk we were informed by Defendants' counsel that the deposition would not go forward. We agreed to contact Magistrate Walsh by telephone in order to resolve this issue. Magistrate Walsh Ordered that the deposition would not go forward. 6. Having already flown to Phoenix, we agreed with Defense Counsel to engage in discussions regarding the theory of our RICO/wire fraud claim for a Declaration of DFB- 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 potential amended complaint. We had previously provided Defendants with an outline in laymen's terms of the theory of wire fraud in order to encourage resolution. On July 20, 2010, we also showed Defendants a number of Rip-Off Reports about parties that had previously been in litigation against Defendants, showing that the Rip-Off Reports about these settling parties appeared to have been altered significantly following settlement. They contained favorable text about the subjects at the beginning of the Rip-off Reports or contained disclaimers regarding the contents of the Rip-off Reports, which appeared to have been added following dismissals of the actions. We sought to understand from Defendants' counsel the circumstances under which such alterations would be made. 7. Defense Counsel, David Gingras, Maria Crimi Speth and Adam Kunz and their client, Ed Magedson, engaged in these discussions with us. Defendants' counsel also stated that in every voluntary settlement, including in cases involving the example Rip-off Reports that had been substantially altered or disclaimed, the settling parties had paid money to Defendants in the form of legal fees, even in cases where the Court Order of dismissal had ordered each side to bear their own costs and fees. 8. While in discussion, Plaintiffs' attorneys also showed Defendants' attorneys email communications between Kenton Hutcherson and Defendants' attorneys Maria C. Speth and David S. Gingras. Plaintiffs' Attorneys showed Ms. Speth the emails to give Defendants a full opportunity to explain their side of the story, as the emails appeared on their faces to show that the assertion that Rip-off Reports are never removed is not, in fact, true. True and correct copies of the emails were subsequently attached to the Declaration of Kenton J. Hutcherson as an exhibit to Plaintiffs' First Amended Complaint, and attached hereto as Exhibit "1." Declaration of DFB- 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 9. The emails discussed notice of breach and demand to cure a provision of a settlement agreement entered into on May 15, 2009 by and between Defendants and QED Media Group, LLC and Robert Russo. A copy of what has been represented as the May 15, 2009 settlement agreement by and between the above parties is attached to Plaintiffs' First Amended Complaint as an exhibit and is attached hereto as Exhibit "2." 10. The May 15, 2009 settlement agreement provides that Defendants will not permit future Rip-off Reports regarding QED Media Group, LLC and Robert Russo to be posted if they could not be verified as coming from actual customers. 11. According to the emails in Exhibit 1, in the months of October and December of 2009, false Rip-off Reports regarding QED Media Group, LLC and Robert Russo were posted without verification. Upon notification of the breach, Defendants eventually deactivated or took down the Rip-off Reports at issue. 12. According to the emails, Hutcherson requested a cure of this breach of the May 15, 2009 settlement agreement. Defendants subsequently removed reports concerning QED Media Group, LLC and Robert Russo on two occasions, October 29, 2009 and December 28, 2009. For example, in an October 29, 2009 email to Mr. Hutcherson from Ms. Speth, she states: "Ripoff Report has decided to completely remove report number 10675. It was deactivated yesterday." Exhibit 1 at 8 (Hutcherson Dec., Ex. B) (emphasis added). In another email dated December 28, 2009 Ms. Speth informs Mr. Hutcherson of the following: "The Report has been taken down." Exhibit 1 at 12 (Hutcherson Dec., Ex. C) (emphasis added). Declaration of DFB- 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 13. When Plaintiffs' Counsel asked Defendants' Counsel, Ms. Speth, about these emails, she confirmed that Defendants had, in fact, removed two (2) reports concerning QED Media Group, LLC and Robert Russo on October 29, 2009 and December 28, 2009 subsequent to notification by Mr. Hutcherson. Her comments admitted that the emails were genuine. She also spontaneously volunteered that Mr. Russo had owed them a large five or six figure sum of money per the settlement agreement and that he had defaulted on that portion of the money. 14. Again, during these July 20, 2010 discussions Plaintiffs' Counsel was threatened with a future lawsuit(s) in the State of Arizona, even though this action had not favorably terminated. 15. At the conclusion of this July 20, 2010, meeting Mr. Magedson had a discussion with Mr. Mobrez outside of the presence of the attorneys. At the end of the discussion, Mr. Magedson stormed out of the small conference room in which they had been meeting a rage and pointed at Ms. Borodkin and yelled at her, stating that she would be "on the cover of his next book." When Ms. Borodkin questioned Mr. Magedson about his statement he replied that she knew what he meant and that the subject of the book would focus on the world's worst attorneys. Next, Mr. Magedson pointed his finger at me (uncomfortably close to my face) and stormed out of the room. 16. I would also like to note that during the course of our discussions with Mr. Magedson he made some very offensive, odd, and reprehensible comments about me, which were not relevant to the case, and seemingly were meant to demean my personal appearance. I found his comments to be odd and hurtful. Out of respect for everyone present and this Court, I did not respond. 17. Defendants' counsel has previously threatened Plaintiffs' counsel on several occasions, always coupled with a demand that Plaintiffs' counsel cause Plaintiffs to settle this case and pay all of Defendants' purported Declaration of DFB- 5 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 attorneys' fees. Defendants' General Counsel, David Gingras, has made several types of threats to Plaintiffs' counsel personally in demanding attorneys' fees. On May 10, 2010, Mr. Gingras stated to Ms. Borodkin and me, "I hope you've enjoying practicing law in California," coupled with a demand that Plaintiffs' pay Defendants $25,000 in purported attorneys' fees to resolve this case. 18. On June 8, 2010, Mr. Gingras made a graphic, vivid threat to Ms. Borodkin and myself, again coupled with a demand that we cause Plaintiffs to settle this action and pay all of Defnedants' attorneys fees in excess of $25,000. Following the deposition of Mr. Magedson on June 8, 2010, in a temporary conference room at Jaburg & Wilk, while Mr. Magedson and the court reporter and videographer had left the room, Mr. Gingras said to Ms. Borodkin and me: "Our business model is as follows: We want to have Ripoff Report like a castle. And we want to have stakes outside the castle. And for anyone who challenges Ripoff Report, we want to have their heads on those stakes for everyone to see." I vividly remember the words spoken by Mr. Gingras because I found the imagery of "heads on stakes" deeply disturbing. 19. On July 28, 2010, Mr. Hutcherson forwarded Plaintiffs' attorneys a demand letter/takedown notice he had received from Defendants' attorneys. A true and correct copy of the July 28, 2010 letter from Maria Speth to Mr. Hutcherson is attached hereto as Exhibit "3." The letter, inter alia, falsely claims that the effect of the Communications Decency Act cannot be challenged in any court, and demands that Mr. Hutcherson file a declaration in this action adding additional facts, and demands that Mr. Hutcherson refrain from taking certain future employment adverse to Defendants. 20. On August 3, 2010, Attorney Hutcherson forwarded an email to Plaintiffs' Counsel wherein Defendants accused Mr. Hutcherson of making false statements regarding the aforementioned May 15, 2009 settlement agreement Declaration of DFB- 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 and claiming that his factual declaration was an "abusive litigation practice," even though Mr. Hutcherson is only a fact witness in this case. A true and correct copy of the August 3, 2010 email forwarded to Plaintiffs' Counsel is attached hereto as Exhibit "4". 21. In Exhibit "4," Defense Counsel also informed Mr. Hutcherson that they were creating a new section on Defendants' website entitled "The Hall of Shame" and that Mr. Hutcherson would be featured in this section of ROR's website. The email more disturbingly stated the following: "Ripoff Report will not agree to any settlement in any case in which Mr. Hutcherson is involved." 22. On August 6, 2010, Defendants posted a Rip-Off Report about Mr. Hutcherson that is substantially the same as the proposed text in the "Hall of Shame" threatened against Mr. Hutcherson in Exhibit 4. A true and correct copy of Rip-off Report Number 629379 is attached hereto as Exhibit "5." The Ripoff Report about Mr. Hutcherson states that it is submitted by "Ripoff Report" itself, and claims full authorship by Defendants, as it is written with the pronouns "us" and "we." 23. Attached hereto as Exhibits "6" and "7" are true and correct copies of a redacted declaration provided from Defendants' attorney, Mr. Gingras and one of the relevant attachments (redacted) thereto on July 14, 2010. Pursuant to 28 U.S.C., Section 1746, I declare under penalty of perjury under the Laws of the United States of America that the foregoing is true and correct. EXECUTED ON: August 23, 2010 at Los Angeles, California. /s/Daniel F. Blackert 25 26 27 28 Daniel F. Blackert, Esq. Declaration of DFB- 7

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