Bank Julius Baer & Co. Ltd. et al v. Wikileaks et al

Filing 6

Brief re 5 Ex Parte MOTION for Preliminary Injunction and TRO and OSC (Part 1) filed byBank Julius Baer & Co. Ltd., Julius Baer Bank and Trust Co. LTD.. (Attachments: # 1 Supplement Part 2 of Memorandum of Points & Authorities, # 2 Supplement Part 3 of Memorandum of Points & Authorities, # 3 Supplement Part 4 of Memorandum of Points & Authorities, # 4 Supplement Part 5 of Memorandum of Points & Authorities)(Related document(s) 5 ) (Briggs, William) (Filed on 2/8/2008)

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Bank Julius Baer & Co. Ltd. et al v. Wikileaks et al Doc. 6 1 2 3 4 5 6 7 8 9 10 11 12 MARTIN D. SINGER, ESQ. (BAR NO. 78166) WILLIAM J. BRIGGS, II, ESQ. (BAR NO. 144717) EVAN N. SPIEGEL, ESQ. (BAR NO. 198071) LAVELY & SINGER PROFESSIONAL CORPORATION 2049 Century Park East, Suite 2400 Los Angeles, California 90067-2906 Telephone: (310) 556-3501 Facsimile: (310) 556-3615 E-mail: wbriggs@lavelysinger.com E-mail: espiegel@lavelysinger.com Attorneys for Plaintiffs BANK JULIUS BAER & CO. LTD and JULIUS BAER BANK AND TRUST CO. LTD UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION ) ) ) ) ) ) Plaintiffs, ) ) v. ) WIKILEAKS, an entity of unknown ) form, WIKILEAKS.ORG, an entity ) of unknown form; DYNADOT, ) LLC, a California limited liability ) corporation, and DOES 1 through ) 10, inclusive, ) ) Defendants. ) ) ) CASE NO. CV08-0824 JSW [Hon. Jeffrey S. White; CRTM 2] PLAINTIFFS' MEMORANDUM OF POINTS & AUTHORITIES IN SUPPORT OF APPLICATION FOR TRO AND OSC RE PRELIMINARY INJUNCTION; DECLARATIONS OF CHRISTOPH HIESTAND AND EVAN SPIEGEL IN SUPPORT THEREOF [Filed Concurrently With: Ex Parte Application for TRO and OSC re Preliminary Injunction; Memorandum of Points & Authorities in Support of Application for TRO and OSC re Preliminary Injunction; Ex Parte Administrative Motion to File Under Seal Selected Evidence Exhibits; Notice of Lodgement; [Proposed] Order to Seal Selected Exhibits; Request for Judicial Notice; [Proposed] TRO and OSC Re Preliminary Injunction]; and [Proposed] Order Granting Preliminary Injunction] DATE: Submission TIME: Submission CTRM: 2, 17th FL /// CV08-0824 JSW BANK JULIUS BAER & CO. LTD, a Swiss entity; and JULIUS 13 BAER BANK AND TRUST CO. LTD, a Cayman Islands entity, 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4405-2\Ple\APPL-P&A TRO-INJ 020808 i PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ Dockets.Justia.com 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 4405-2\Ple\APPL-P&A TRO-INJ 020808 TABLE OF CONTENTS Page No. MEMORANDUM OF POINTS & AUTHORITIES . . . . . . . . . . . . . . . . . 1 I. INTRODUCTION A. B. II. .................................. 1 ............................. 3 . . . 11 Summary of Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Factual Background PLAINTIFFS ARE ENTITLED TO A TEMPORARY RESTRAINING ORDER AND PRELIMINARY INJUNCTION a. Plaintiffs Have Established a Strong Probability of Success on the Merits, the Possibility of Irreparable Injury and the Balance of Hardships Tips in Overwhelmingly in Their Favor . . . . . . . . . . . . . . . . . . . . . 12 i. Plaintiffs' Unfair Competition Claims Justify Injunctive Relief to Prohibit Defendants' Further Use, Display and/or Dissemination of the JB Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 (a) (b) (c) 2. Federal & California Law Each Protect the JB Property . . . . . . . . . . . . . . . . . . 13 Cayman Islands & Swiss Banking and Privacy Laws Each Protect the JB Property . . . . . . . . . . . 14 Defendants' Conduct is Unlawful and Warrants Injunctive Relief . . . . . . . . . . . . . . . . 15 Plaintiffs' Likelihood of Success on the Merits of their Conversion and Tort Claims Supports The Imposition of Injunctive Relief . . . . . . . . . . . . . . . . . . 16 B. III. IV. Plaintiffs Have Suffered And Will Continue To Suffer Irreparable Harm Should An Injunction Not Issue . . . . . . . . . . 18 PLAINTIFFS SHOULD BE REQUIRED TO POST ONLY A MINIMAL BOND IN LIGHT OF DEFENDANTS' CONDUCT . . 20 CONCLUSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 CV08-0824 JSW ii PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ 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 TABLE OF AUTHORITIES FEDERAL CASES Page No. AT&T Communications of Cal. v. Pacific Bell, 1996 WL 940836, 11 (N.D. Cal 1996) . . . . . . . . . . . . . . . . . . . . . . . . 19 BP Chemicals Ltd. v. Formosa Chemical & Fibre Corp., 229 F.3d 254 (3rd Cir. 2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Caterpillar, Inc. v. Nationwide Equip., 877 F. Supp 611 (M.D. Fla. 1994) . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Ferguson v. Tabah, 288 F.2d 665 (2d Cir. 1961) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 GoTo.com, Inc. v. The Walt Disney Co., 202 F.3d 1199 (9th Cir. 2000) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Iconix, Inc. v. Tokuda, 457 F.Supp.2d 969 (N.D. Cal. 2006) . . . . . . . . . . . . . . . . . . . . . . . 11, 18 International Controls Corp. v. Vesco, 490 F.2d 1334 (2d Cir 1974) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Isuzu Motors, Ltd. v. Consumers Union of U.S., Inc., 12 F.Supp.2d 1035 (C.D. Cal. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . 12 Michaels v. Internet Ent. Group, Inc., 5 F.Supp.2d 823 (C.D. Cal. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Micro Star v. Formgen, Inc., 154 F.3d 1107 (9th Cir. 1998) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Ocean Garden, Inc. v. Marktrade Co., Inc., 953 F.2d 500 (9th Cir. 1991) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Perfect 10, Inc. v. Cybernet Ventures, Inc., 213 F. Supp. 2d 1146 (C.D. Cal. 2002) . . . . . . . . . . . . . . . . . . . . . . . . 19 Peripheral Devices Corp. II v. Ververs, 1995 U.S. Dist Lexis 11389, 27-28 . . . . . . . . . . . . . . . . . . . . . . . . . . 19 Sierra On-Line, Inc. v. Phoenix Software, Inc., 739 F.2d 1415 (9th Cir. 1984) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134 (9th Cir. 1997) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 /// iii PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ 4405-2\Ple\APPL-P&A TRO-INJ 020808 CV08-0824 JSW 1 2 3 4 5 6 FEDERAL CASES (CONT.) Page No. Stuhlbarg Int'l Sales Co. v. John D. Brush & Co., Inc., 240 F.3d 832 (9th Cir. 2001) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11, 18 Topanga Press, Inc. v. City of LA, 989 F.2d 1524 (9th Cir. 1993) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Urbain v. Knapp Brothers Mft'g Co., 217 F.2d 810 (6th Cir. 1954), 7 cert. denied, 349 U.S. 930, 75 S.Ct. 772 (1955) . . . . . . . . . . . . . . . . . . 21 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 STATE CASES Barquis v. Merchants Collection Ass'n, 7 C.3d 94, 101 Cal.Rptr. 745 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 Barthelmess v. Cavalier, 2 Cal.App.2d 477, 38 P.2d 484 (1934) . . . . . . . . . . . . . . . . . . . . . . . . 17 Britt v. Sup. Ct., 20 Cal.3d 844, 143 Cal.Rptr. 695 (1978) . . . . . . . . . . . . . . . . . . . . . . . 13 Burrows v. Sup. Ct., 13 Cal.3d 238, 118 Cal.Rptr. 166 (1974) . . . . . . . . . . . . . . . . . . . . . . . 13 Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co., 20 Cal.4th 163, 83 Cal.Rptr.2d 548 (1999) . . . . . . . . . . . . . . . . . . . 12, 13 Culp v. Signal Van & Storage Co., 142 Cal.App.2d Supp. 859, 298 P.2d 162 (1956) . . . . . . . . . . . . . . . . . . 17 Farmers Ins. Exch. v. Sup.Crt., 2 Cal.4th 377, 6 Cal.Rptr.2d 487 (1992) . . . . . . . . . . . . . . . . . . . . . . . 13 Gladstone v. Hillel, 203 Cal. App. 3d 977, 250 Cal. Rptr. 372 (1988) . . . . . . . . . . . . . . . 16, 19 Heckmann v. Ahmanson, 168 Cal.App.3d 119, 214 Cal.Rptr. 177 (1985) . . . . . . . . . . . . . . . . . . . 19 Kasky v. Nike, Inc., 27 Cal.4th 939, 119 Cal.Rptr.2d 296 (2002) . . . . . . . . . . . . . . . . . . . . . 12 People v. E.W.A.P., Inc., 106 Cal.App.3d 315, 165 Cal.Rptr. 73 (1980) /// iv PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ . . . . . . . . . . . . . . . . . 12, 13 4405-2\Ple\APPL-P&A TRO-INJ 020808 CV08-0824 JSW 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 4405-2\Ple\APPL-P&A TRO-INJ 020808 STATE CASES (CONT.) Page No. Pines v. Tomson, 160 Cal.App.3d 370, 206 Cal.Rptr. 866 (1984) . . . . . . . . . . . . . . . . . . . 12 Spates v. Dameron Hospital Assn., 114 Cal.App.4th 208, 7 Cal.Rptr.3d 597 (2003) . . . . . . . . . . . . . . . . . . 17 Swim v. Wilson, 90 Cal. 126, 27 P. 33 (1891) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Valley Bank of Nevada v. Sup. Ct., 15 Cal. 3d. 652, 542 P.2d 977 (1975) . . . . . . . . . . . . . . . . . . . . . . . 13, 14 Woodsend v. Chatom, 191 Cal. 72, 214 P. 965 (1923) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 FEDERAL STATUTES / RULES 12 U.S.C. 3401 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Fed. R.Civ.Proc., Rule 44.1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5, 14 Fed. R.Civ.Proc., Rule 65(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 STATE STATUTES / LAW California Constitution Art. I, 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 Cal. Business & Professions Code 17200 et. seq. . . . . . . . . . . . . . . 12, 13 OTHER AUTHORITIES/SOURCES The Cayman Islands' Confidential Relationships (Preservation), Law 16 of 1976, 1995 Revision . . . . . . . . . . . . . . . . . . . . . . . . . 5, 14, 15 Swiss Federal Law on Banks and Savings Banks, of November 8, 1934, language of December 27, 2006, adopted by The Federal Assembly of the Swiss Confederation, Article 47 . . . 5, 14, 15 CV08-0824 JSW v PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ 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 MEMORANDUM OF POINTS & AUTHORITIES I. INTRODUCTION A. Summary of Argument Plaintiffs Bank Julius Baer & Co. Ltd ("BJB") and Julius Baer Bank and Trust Co. Ltd ("JBBT") (collectively, "Julius Baer" and/or "Plaintiffs"), seek a temporary restraining order ("TRO") and a preliminary injunction to prevent the continued wrongful, unlawful and damaging publication and dissemination of stolen confidential bank documents and account records, belonging to Plaintiffs, on defendants' "uncensorable" and "untraceable mass document leaking" website Wikileaks.org. Such documents are protected and prohibited from being published under applicable consumer banking and privacy protection laws, including applicable Swiss and Cayman Islands laws, as well as federal and California Constitutional privacy rights and unfair business practices laws. Defendants WIKILEAKS and WIKILEAKS.ORG, and their owners, operators and agents (collectively herein, "Wikileaks"), through their website operated at their domain name wikileaks.org (the "website"), have the sole purpose of providing a site for the "simple and straightforward means for anonymous and untraceable leaking of documents," regardless of legality or authenticity. See the accompanying Spiegel declaration ("Spiegel Decl.") 4-6, Exhs. "A". Wikileaks attempts to operate under a veil of anonymity, or as they term it "transparency," and, at the same time, its owners, operators and agents post and disseminate the personal details and even bank account records of others. (Id., 4, 8, Exh. "B"). In this matter, Wikileaks solicits the submission or upload of unlawfully obtained confidential documents. It then publically disseminates the records, including stolen legally protected bank files, records and account information related to Plaintiffs' bank and certain of its bank customers (the "JB Property"). (Spiegel Decl. 5-7, 9-10, Exh. "A"; See also, the accompanying Hiestand declaration 1 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 ("Hiestand Decl.") 5-7, 26). Wikileaks not only solicits and receives submissions of unlawfully obtained documents, its operators thereafter summarize and describe the contents of such documents, re-publish information contained therein, and otherwise exploit the stolen documents for their own unfair and unlawful business practices. (Spiegel Decl., 5-7, 9). Wikileaks' conduct makes it complicit with its submitters of leaked and stolen documents. Plaintiffs are the sole owners of all right, title and interest in the JB Property. (Hiestand Decl. 4-6, 12-13, 26). Wikileaks' conversion, use, display and dissemination of the JB Property on the Website is unauthorized and unlawful. For example, Plaintiffs did not give Wikileaks permission to publish, display or disseminate the JB Property. In fact, Wikileaks display and dissemination violates the rights of Plaintiffs, as well as numerous third-parties, and applicable Swiss and Cayman Islands banking and consumer protection laws. Wikileaks' dissemination of this information also violates California Constitutional privacy rights. As discussed below, Plaintiffs have established a likelihood of success on the merits as to their claims. And, absent issuance of an injunction to prevent the further dissemination of private and highly confidential bank records and account information, Plaintiffs will suffer irreparable injury. hardships tip decidedly in Plaintiffs' favor. The Court should therefore grant Plaintiffs' Application and issue a TRO and Order to Show Cause ("OSC") Re Preliminary Injunction. B. Factual Background Wikileaks and Defendants Defendants WIKILEAKS and WIKILEAKS.ORG are each anonymous fictitious business names and/or aliases. Wikileaks, through one or more yet unidentified Doe individuals or agents, are the owners, operators and/or registrants of the world wide web website operating under and at the domain name wikileaks.org (the "Website"). (Spiegel Decl., 4, 8, Exhs. "A", "B"). 2 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. Further, the balance of 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 The Wikileaks Website is operated by its owners and agents for the express stated purpose of providing "uncensorable," "simple and straightforward means for anonymous" and "untraceable mass document leaking," regardless of legality or authenticity, and without regard for the rights of any aggrieved parties. (Spiegel Decl., 4-6, Exh. "A"). Wikileaks solicits and receives submissions of documents; it posts the leaked documents; and it thereafter posts summaries of the documents and comments on the information. Wikileaks actively participates in the post of the documents and information which appear and are available for download on their Website. (Attached as Exhibit "A" to the Spiegel Declaration are true and correct copies of printouts and/or screen-shots of the "Home" pages, "About" pages, "Legal" pages, "Contact" and "Submissions" pages of the Website, upon which Wikileaks solicits, encourages and facilitates the breach of consumer protection laws, banking privacy laws, written confidentiality agreements and the unlawful dissemination of protected records.) Wikileaks' "Contact" page also shows that it has a submission address for submission and receipt of "leaked" documents in California. (Spiegel Decl., 6, Exh. "A"). The domain name wikileaks.org (the "Domain Name") was registered through and is currently administered through an account with defendant DYNADOT, LLC ("Dynadot"), and has its DNS services provided by Dynadot. Dynadot has, for a fee and profit, provided a private anonymous who-is registration service to the registrants of the Domain Name which allow Wikileaks' owners and operators to anonymously operate unlawfully. By virtue of the terms of the anonymous who-is registration service, Dynadot acts as the agent and administrative contact for the registrant of the Domain Name. Dynadot's domain name server ("DNS") services allow the wikileaks.org domain name to resolve to and display the Website operated at wikileaks.org. (Id., 8). (Attached as Exhibit "B" to the Spiegel Decl. are true and correct copies of the official "who-is" domain registration records for the <wikileaks.org> Domain Name, evidencing that it is registered with Dynadot, 3 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 under an anonymous registration service intended to hide the true identity and location of the domain's owners and operators.) Plaintiffs Bank Julius Baer & Co. Ltd ("BJB") is one of the leading private banks in Switzerland. BJB forms part and is one of the core companies of Julius Baer Group ("JBG"), the parent company of which is Julius Baer Holding Ltd. ("JBH"), whose shares are listed at the SWX Swiss Exchange. The Julius Baer Group's global presence comprises more than 30 locations in Europe, North America, Latin America and Asia, including Zurich (head office), Los Angeles, New York and Grand Cayman. (Hiestand Decl., 2). Julius Baer Bank and Trust Co. Ltd ("JBBT") is, as is BJB, a member of the JBG and a direct subsidiary of JBH, and carries out, amongst other things, private banking and trust services. JBBT operates at Grand Cayman. (Id.). JBBT, as was BJB, is the former direct employer of disgruntled ex-employee Rudolf Elmer ("Elmer"). Elmer unlawfully took the client bank records and data at issue in violation of Swiss and Cayman Islands banking and privacy protection laws. And, Elmer violated his written confidentiality agreement with respect to disclosure of these records. (Id., 4, 8-10, Exh. "A"). Written Employment Contract & Privacy Laws Under the terms of an employment agreement dated September 1, 1987, BJB employed Elmer as an internal auditor in its Zurich office. Between February 1994 through August 2002, Elmer went to work in the Cayman Islands at JBBT as an "expatriate," based on employment contracts with JBH and BJB. In September 2002, Elmer entered into a subsequent employment and confidentiality agreement ("the Agreement"). That Agreement provided that Elmer was employed directly by JBBT as Senior Vice President and Chief Operating Officer. (Id., 8-9). (A true and correct copy of the Agreement, which is incorporated by reference herein, is attached to the Hiestand Decl. as Exhibit "A".) The Agreement states, in paragraph 11, that: "[Elmer] shall not at any time ... disclose to any person any information 4 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 as to the practice, business, dealings or affairs of the Employer or any of the Employer's customers or clients ...." (Hiestand Decl., 9, Exh. "A"). All data and records of the Julius Baer banks were and are protected not only under employee confidentiality agreements, but also under a number of different banking and consumer privacy laws. Those laws include Swiss law and the Cayman Islands law the location from which the JB Property was stolen. (Id., 10). The Cayman Islands' Confidential Relationships (Preservation) Law ("CI-CRP Law"), paragraph 3, provides, inter alia, that the law "has application to all confidential information with respect to business of a professional nature which arises in or is brought to the Islands and to all persons coming into possession of such information." (Hiestand Decl., 11, Exh. "B").1 Given the "expatriate" status of Elmer while working on the Cayman Islands under Swiss-law based employment contracts, respective banking privacy laws of Switzerland are relevant and applicable in this case as well. Article 47 of the Swiss Federal Law on Banks and Savings Banks ("Swiss FLBSB Law"), which protects confidentiality of all Swiss banking records and data, and provides, inter alia, that: "whoever divulges a secret entrusted to him in his capacity as officer, employee ... of a bank, ... or has become aware thereof in this capacity, whoever tries to induce others to violate professional secrecy, shall be punished by imprisonment ..." (Hiestand Decl., 12, Exh. "C"). Plaintiffs have requested that, pursuant to FRCP 44.1 (through Plaintiffs' contemporaneously filed Request for Judicial Notice), the Court take judicial notice Paragraph 2 of the CI-CRP Law defines the following terms as: (i) ""confidential information" includes information concerning any property which the recipient thereof is not, otherwise than in the normal course of business, authorised by the principal to divulge"; (ii) ""business of a professional nature" includes the relationship between a professional person and a principal, however the latter may be described"; (iii) ""professional person" includes ... a bank ... and every person subordinate to or in the employ or control of such person for the purpose of professional activities"; and (iv) ""property" includes every ... interest or claim direct or indirect, legal or equitable, ... in any money, moneys worth, ... movable or immovable, rights and securities and all documents and things evidencing or relating thereto". 5 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 1 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 of the applicable Swiss and Cayman Islands privacy laws. Elmer was dismissed by JBBT in December 2002 on grounds of misconduct. (Hiestand Decl., 13). After his employment with JBBT had been terminated, it was discovered that Elmer had, without authorization, copied and stored confidential information and documents about some of JBBT's clients on his home and office computers, which were recovered. (Id., 13). There was no legitimate reason for such confidential banking and client information to have been stored on Elmer's computers. (Id.). Elmer subsequently demanded and tried to extort a substantial severance package which, of course, JBBT refused to pay. In his correspondence, Elmer threatened to mount a public campaign against JBBT and JBJ unless his extortion demands were met. (Id.). Leak to Swiss Newspaper Plaintiff BJB was contacted in June 2005 by a Swiss newspaper, CASH, which had been provided with a CD-rom containing a large number of JBBT's confidential documents that had evidently been stolen and unlawfully provided to the newspaper. (Id., 14). The newspaper then published an article about BJB, which stated, amongst other things, that: "An anonymous person sends complete data files about well-to-do customers from around the world. Customer information from the Baer Group was transmitted anonymously to the CASH editors. Customers seeking greater discretion protection, of all people, were affected. Their total holdings are in the billions. ... The contents, ... absolutely not for general consumption: 169 megabytes of files with customer and business information from a money institution, whose world fame is built on secrecy. The data files come from the office of the Julius Baer Group on the Cayman Islands. ...." A true and correct copy of the article and an English translation of it are attached to the Hiestand Decl. as Exhibit "D". The story in CASH was then picked up by various other newspapers in a variety of locations. Neither CASH nor any of the other publications actually published any of Plaintiffs' bank records or its clients' confidential information or identifications the Wikileaks defendants are the only ones to do so (as set forth 6 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 below). (Hiestand Decl., 14-15). A Swiss newspaper called Die Weltwoche published an article on June 23, 2005, in which the initials of the person who had leaked the confidential information were described as being "RE"; and who was also described as having formerly worked for JBBT. (Id.). Investigations by the Authorities Only a very limited number of people, of which Elmer was one, would have had access to the data and documents. Once this and other information came to light, BJB filed a criminal complaint against Elmer with the public prosecutor in Zurich, Switzerland. (Id., 16). A subsequent police search of Elmer's properties unequivocally uncovered further confidential bank-client data and documents in Elmer's possession. Investigations have implicated Elmer as responsible for the leaked confidential bank-client data. (Id.). Elmer was arrested and detained for approximately one month by the Swiss authorities before he was released pending an on-going criminal investigation and proceedings. (Id., 16-17). Elmer is the subject of multi-national criminal investigations related to not only the above referenced theft of confidential records, but also related to his attempted extortion and a campaign of threats and terrorist threats against Plaintiffs and certain of its employees (e.g., death and bomb threats, including reference to "9/11", and threatening letters containing "white powder" sent to the premises of the Plaintiffs in New York and Zurich). (Id., 17-19). As one of many such possible examples, BJB's Deputy Group General Counsel received an e-mail, on August 7, 2007, stating, in part: "it is about time to let you know my hunter is after you. You are number one on my list ... It is not the first job the hunter did and execution is his strength. ... Thank you for being so kind to me but now we need to get rid of you. Regards the Hunter". (Hiestand Decl., 18, Exh. "E"). As an example of the multiple terrorist threats, a letter sent September 7, 2007 to BJB's Zurich bank branch, stated: 7 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 "There will be an explosion the Bank today, Friday, at 11.00PM which will remind everyone on [sic] the September 11th!" (Hiestand Decl., 19, Exh. "F"). In or about November 2006, Elmer filed a criminal complaint against BJB and several employees on the basis that it/they had allegedly been stalking him (by use of a security expert who traced the various tortious and illegal conduct to Elmer). Elmer's claim was entirely without merit, and subsequently dismissed as such by the relevant authorities on December 11, 2007. (Id., 20). The respective decision, which according to its distribution list was sent by the authorities only to Elmer, was subsequently published on Wikileaks.org (in a folder "Bank Julius Baer v. Rudolf Elmer") as well. (Id.). Publication of Documents on Wikileaks Between November and December 2007, Elmer provided several documents relating to BJB and JBBT to the Wikileaks Website. These contained various untrue allegations about the Plaintiffs but did not contain any of Plaintiffs' confidential information. (Hiestand Decl., 21). In or about mid-December 2007, Elmer provided a letter to Wikileaks, which they posted onto the Wikileaks.org Website and commented on and summarized, containing the judicial denial notice issued to Elmer from Swiss authorities. Plaintiffs do not contend that the posting of the document was wrongful or that said document should be removed. However, the posts made it apparent that Elmer was a former employee of Plaintiffs, was bound by a confidentiality agreement and various banking privacy laws of Switzerland and the Cayman Islands, and was the person responsible for providing information about the Julius Baer bank to the owners/operators of the Wikileaks Website. (Id., 22). Subsequently, commencing on or about January 13, 2008, Elmer began posting hundreds of documents containing stolen or wrongfully obtained and disclosed confidential banking records belonging to Plaintiffs, including altered 8 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 and/or forged or semi-forged "leaked" documents. (Hiestand Decl., 24-25; Spiegel Decl., 9). A number of the documents have been altered to falsely appear to have been created after 2002 and/or have been re-named in a manner which is intended to make the documents and folders appear to contain records of nefarious or unethical transactions. (Id.). Elmer and the Wikileaks defendants have posted onto the Website, summarized, repeated, translated and/or re-posted and continue to display or make available approximately 694 different documents and folders which contain confidential bank records and client data. (Hiestand Decl., 26; Spiegel Decl., 9-10, Exhs. "C", "D"). The JB Property, as disclosed on the Website, references protected consumer bank files, records, data and account information related to or purported to relate to certain of JBBT's bank customers. All of the files are protected by law, owned by JBBT and/or BJB and have never been authorized to be disclosed to the public. Plaintiffs would not have disclosed, nor knowingly made, the confidential JB Property available to the public. (Hiestand Decl., 6-12, 26). The "JB Property" includes and is defined herein as any and all documents and information originating from BJB's and/or JBBT's banks and affiliated bank branches; which contains private client bank records and/or identifies client names, data, account records and/or bank account numbers; whether or not such documents and information are authentic, semi-altered, semi-fraudulent or forged; and which appears to have originated from or could reasonably be known to be or considered to constitute or have originated from data and documents stolen or misappropriated from one or more of Plaintiff's bank branches and/or computers. Attached to the Hiestand Decl., 5, as Exhibit "C" is an index listing (as titled by Wikileaks and/or Elmer, but semi-redacted) of the JB Property made available by Wikileaks through its Website. A copy printouts showing lists of every document and folder of the JB Property, along with a copy of selected representative samples of the many thousands of pages of the JB Property made available by Wikileaks on its Website 9 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 have been concurrently hereto lodged with the Court in conjunction with a Motion to File Under Seal. (Spiegel Decl. 10). Plaintiffs have not requested nor demanded removal or reference to any articles related to the existence of the dispute with Elmer and/or any of his contentions and/or any public discussion on the various civil and criminal proceedings related to Elmer. Plaintiffs merely seek removal and protection of the specific stolen confidential bank documents or, at minimum, all of the identifying client data and account numbers. (Hiestand Decl., 27; Spiegel Decl., 11-13). Wikileaks is fully knowledgeable of the nature of the unlawfully obtained and protected consumer banking records. Despite notice to Wikileaks' counsel of (i) the nature of the unlawfully leaked documents and (ii) that the source of the documents is bound by a written confidentiality agreement and various banking privacy laws; and reasonable requests that the identifying information be removed; Wikileaks has refused to remove the posted stolen documents, as well as any of the identifying client/customer data. In fact, after a good-faith effort to resolve the matter by a call to and discussion with Wikileaks' counsel, Wikileaks thereafter posted misstatements of the conversation and all of opposing counsel's contact information on the Website, and at the same time, removed the contact information for its own counsel. (Spiegel Decl., 13-14). Wikileaks has apparently reposted the unlawfully leaked documents and information in an apparent effort to keep the posts at the fore-front of its Website and to unlawfully exploit the information. (Id., 15). Wikileaks has sought to capitalize on and further exploit its own unfair and unlawful practices and conduct to increase their Website's notoriety and traffic. The disgruntled ex-bank employee responsible for the leaks continues to provide documents to Wikileaks, and has indicated, as of February 4, 2008, that additional documents are to be released in the coming weeks. (Id., 15, Exh. "E"). The publication, dissemination and exploitation of stolen legally protected bank files related to Plaintiffs' bank customers has resulted in harm to Plaintiffs' 10 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 reputations, its customers' confidence in the bank and its customer banking relationships, among other damages. (Hiestand Decl., 28). Such publication, dissemination and exploitation is in breach of the relevant banking and privacy laws of Switzerland and the Cayman Islands, as well as California Constitutional privacy rights. (Id., 29). II. PLAINTIFFS ARE ENTITLED TO A TEMPORARY RESTRAINING ORDER AND PRELIMINARY INJUNCTION In the Ninth Circuit, "when a party is seeking a preliminary injunction, he or she must show either (1) a combination of probable success on the merits and the possibility of irreparable injury, or (2) that serious questions are raised and the balance of hardships tips in favor of the moving party. These standards `are not separate tests but the outer reaches of a single continuum.'" Iconix, Inc. v. Tokuda, 457 F.Supp.2d 969, 975 (N.D. Cal. 2006), quoting Stuhlbarg Int'l Sales Co. v. John D. Brush & Co., Inc., 240 F.3d 832, 839-40 (9th Cir. 2001) (citation omitted). "These two formulations represent two points on a sliding scale in which the required degree of irreparable harm increases as the probability of success decreases." Id. "Under the sliding scale theory, a party seeking an injunction `need not demonstrate that he will succeed on the merits, but must show that his cause presents serious questions of law worthy of litigation.'" Iconix, Inc., at 975, quoting Topanga Press, Inc. v. City of LA, 989 F.2d 1524, 1528 (9th Cir. 1993). Additionally, serious questions are "substantial, difficult, and doubtful, as to make them fair ground for litigation and thus for more deliberative investigation." Id. Application of these principles to the present facts establishes that injunctive relief is necessary and appropriate in light of Plaintiffs' probable success on the merits and the obvious irreparable injury if relief is not granted, thereby tipping the balance of hardships strongly in Plaintiffs' favor. Here, numerous separate and 11 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 independent grounds warrant issuance of the injunctive relief requested, including the following: A. Plaintiffs Have Established a Strong Probability of Success on the Merits, the Possibility of Irreparable Injury and the Balance of Hardships Tips in Overwhelmingly in Their Favor. 1. Plaintiffs' Unfair Competition Claims Justify Injunctive Relief to Prohibit Defendants' Further Unlawful Use, Display and/or Dissemination of the JB Property. California's unfair competition and business practices law, Business & Professions Code 17200 et. seq. ("UCL"), defines unfair competition to include "any unlawful, unfair or fraudulent business act or practice." Section 17200 prohibits a variety of different types of wrongful conduct, including any "unlawful business act or practice" and/or any "unfair business act or practice." There is no requirement that the activity or conduct sought to be enjoined be commercial any act or practice which is unlawful or unfair is applicable. Barquis v. Merchants Collection Ass'n, 7 C.3d 94, 111, 101 Cal.Rptr. 745, 757; See also, Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134, 1147 (9th Cir. 1997); Isuzu Motors, Ltd. v. Consumers Union of U.S., Inc., 12 F.Supp.2d 1035, 1048 (C.D. Cal. 1998) (allegedly defamatory statements made by a non-profit "consumers union" are covered even though it is completely noncommercial); Pines v. Tomson, 160 Cal.App.3d 370, 386, 206 Cal.Rptr. 866, 875-76 (1984) (non-profit religious group's activities covered); and see People v. E.W.A.P., Inc., 106 Cal.App.3d 315, 320-321, 165 Cal.Rptr. 73, 75-76 (enterprise engaged entirely in criminal conduct is nevertheless a "business" for purposes of 17200). An unlawful business act or practice includes a violation of any other law. In effect, the "unlawful" prong of 17200 makes a violation of the underlying "borrowed" law a per se violation of 17200. Kasky v. Nike, Inc., 27 Cal.4th 939, 950, 119 Cal.Rptr.2d 296 (2002); Cel-Tech Communications, Inc. v. Los Angeles 12 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 Cellular Telephone Co., 20 Cal.4th 163, 180, 83 Cal.Rptr.2d 548, 561 (1999). Virtually any law or regulation state, federal, foreign, statutory or common law can serve as predicate for a 17200 "unlawful" violation. People v. E.W.A.P., Inc., supra, 106 Cal.App.3d at 319, 165 Cal.Rptr. at 75. As the California Supreme Court has stated, 17200 "borrows" violations of any other law and treats them as unlawful business practices independently actionable under 17200. Farmers Ins. Exch. v. Sup.Crt., 2 Cal.4th 377, 383, 6 Cal.Rptr.2d 487, 491 (1992). The JB Property is protected by federal law, the California Constitution, and the banking and privacy laws of the Cayman Islands and Switzerland, where the bank records and documents at issue were originally unlawfully obtained and the associated accounts are located. (a) Federal & California Law Each Protect the JB Property Privacy is a value so fundamental to American society that it is protected by both the United Stated Constitution (implicitly) and the California Constitution (explicitly). See Cal. Const. Art. I, 1. (identifying privacy as among the people's "inalienable rights"). The constitutional provisions create a zone of privacy that protects against unwarranted disclosure of private information. See Britt v. Sup. Ct., 20 Cal.3d 844, 855-856, 143 Cal.Rptr. 695 (1978). Congress has further codified a "Right to Financial Privacy" pertaining to individual's bank records through enacting Title 12, Chapter 35 of the United States Code. The act specifically recognizes the confidential nature of records relating to every financial institutions' relationship with its customers, including "all information known to have been derived therefrom." 12 USCA 3401(2). California's Supreme Court has specifically and long recognized that individuals have a protected right of privacy in their bank records. See, Valley Bank of Nevada v. Sup. Ct., 15 Cal. 3d. 652,656-657, 542 P.2d 977 (1975); Burrows v. Sup. Ct., 13 Cal.3d 238, 118 Cal.Rptr. 166 (1974). Indeed, California's Supreme Court has prohibited the disclosure of individuals' bank records by a third-party 13 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 without a court weighing multiple factors, including, but not limited to, the purpose of the information sought, the effect of the disclosure on the parties, the nature of the objections urged by the party resisting disclosure, and the ability of the court to make an alternative order as may be just under the circumstances. Valley Bank of Nevada, supra, 15 Cal.3d at 656-657. Wikileaks' unwarranted disclosure of the private bank information which comprises the JB Property constitutes unlawful business practices by violation of the above referenced California Constitutional and federal privacy rights law. (b) Cayman Islands & Swiss Banking and Privacy Laws Each Protect the JB Property Plaintiffs' privacy rights in their bank records and information are also codified in the jurisdictions where the records originated and the bank accounts are located. Plaintiffs have requested that, pursuant to FRCP 44.1 (through Plaintiffs' contemporaneously filed Request for Judicial Notice), the Court take judicial notice of the applicable Swiss and Cayman Islands banking and privacy laws. The Cayman Islands Confidential Relationships (Preservation) Law protects confidentiality of all Cayman Island banking records and data, and broadly provides, inter alia, that it "has application to all confidential information with respect to business of a professional nature ... and to all persons coming into possession of such information at any time thereafter whether they be within the jurisdiction or thereout." CI-CRP Law 3(1). (Hiestand Decl., 11, Exh. "B") Similarly, Article 47 of the Swiss Federal Law on Banks and Savings Banks protects the confidentiality of all Swiss banking records and data, and provides, inter alia, that "whoever divulges a secret entrusted to him in his capacity as officer [or] employee ... of a bank, ... or has become aware thereof in this capacity, and whoever tries to induce others to violate professional secrecy, shall be punished by imprisonment ..." (Hiestand Decl. 12, Exh. "C). /// 14 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 Elmer was a bank employee who was entrusted with confidential and secret bank and client information. Elmer is bound by a confidentiality agreement which provides that the documents and information which comprise the JB Property are confidential and not to be disclosed.2 Both the CI-CRP Law and Swiss FLBSB specifically apply to Elmer, as well as anyone who induces him to disclose confidential bank information, whether they come into possession of such information at any time, within the Cayman Islands or anywhere else in the world. Wikileaks induced Elmer to "violate professional secrecy" and to "leak" the "confidential information" which he obtained as a bank officer and employee. Wikileaks has acted in complicity with Elmer in the dissemination of the JB Property; and their conduct constitutes unfair and unlawful business practices by violations of both the Swiss and Cayman Islands privacy laws. (c) Defendants' Conduct is Unlawful and Warrants Injunctive Relief Plaintiffs contend that the solicitation of upload and posting of leaked confidential consumer bank records and account information, wrongfully obtained from a Cayman Islands and/or Swiss bank, and the subsequent use, posting, display and/or dissemination of the documents and information, was and is wrongful, tortious and unlawful under U.S., California, Cayman Islands and Swiss laws. (Hiestand Decl. 6-7, 29; Spiegel Decl. 7, 9-10). Wikileaks' sole purpose or practice is to facilitate the "mass leaking" of documents. (Spiegel Decl. 4-6, Exh. "A"). Wikileaks actively solicits and encourages submission of stolen or unlawfully released documents. Wikileaks has conspired with, implicitly or expressly, and acted in concert with Elmer, who acted on Wikileaks' solicitation to provide it with the stolen confidential records for public 2 Elmer's Agreement provides that he "shall not at any time during his employment ... or at any time after his employment has terminated disclose to 27 any person any information as the business ... or affairs of [the bank] or any of [its] customers ... or as to any other matters which may come to his knowledge 28 by reason of his employment." (Hiestand Decl., Exh. "A"). 26 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 15 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 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 dissemination. There is no difference between the unauthorized and unlawful posting and dissemination of client bank records and account information and/or of medical files and information and/or of social security numbers or any other id-theft information, all of which are prohibited by law. If Wikileaks' unlawful conduct cannot be enjoined, than all privacy rights and laws will be undermined and effectively made meaningless. Plaintiffs respectfully request this Court to protect their property and privacy rights, and that of their clients and all persons everywhere, by enjoining Defendants from continuing to use, post, display and/or disseminate the JB Property and any information contained therein. Plaintiffs' entitlement to injunctive relief is bolstered by the fact that it would be extremely difficult or impossible to measure and determine the amount of damages to its reputation and business should the JB Property be further disseminated to potentially unlimited numbers of people throughout the world wide web. Here, the overwhelming evidence establishes that Defendants' conduct constitutes unfair and unlawful business practices as violations of Plaintiffs' rights established under the applicable Swiss and Cayman Islands privacy laws, as well as California Constitutional and federal privacy rights. Accordingly, Plaintiffs respectfully requested that the Court issue the requested TRO and OSC re preliminary injunction to preclude any further or additional use, reference, display or dissemination of the JB Property. 2. Plaintiffs' Likelihood of Success on the Merits of their Conversion and Tort Claims Supports The Imposition of Injunctive Relief. Injunctive relief is also appropriate based Plaintiffs' conversion and tort claims. It is widely recognized that courts have the power to enjoin a wide range of common law and statutory torts or threatened torts, including conversion. See Gladstone v. Hillel, 203 Cal. App. 3d 977, 988-89, 250 Cal. Rptr. 372 (1988) (citations omitted). One who wrongfully acquires property of another holds the 16 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 property as an involuntary constructive trustee. Id., at 989. In Gladstone, the court affirmed an injunction against further conversion based on copyright infringement, stating that the tortfeasors: "owe[d] to the person they had wronged a duty to avoid further harm to his interest resulting from their wrongful act. This duty requires that they take steps to ... refrain from using ... the property they had converted. A breach of this duty would constitute a separate tort which a court of equity could appropriately enjoin." Id., at 989. The court in Gladstone specifically held that the same principles are "directly applicable to the tort of conversion" and a "breach of this duty would constitute a separate tort which a court of equity could appropriately enjoin." Id. Conversion is the wrongful exercise of dominion over the property of another. The elements of a conversion are (i) the plaintiffs' ownership or right to possession of the property at the time of the conversion; (ii) the defendants' conversion by a wrongful act or disposition of property rights; and (iii) damages. It is only necessary to show an assumption of control or ownership over the plaintiffs' property, or that the alleged converter has applied the property to its own use. Spates v. Dameron Hospital Assn., 114 Cal.App.4th 208, 7 Cal.Rptr.3d 597 (2003). The law is well established that the rightful owner of property cannot lose title through conversion by a third-party. See, Swim v. Wilson, 90 Cal. 126, 128-131, 27 P. 33 (1891); Culp v. Signal Van & Storage Co., 142 Cal.App.2d Supp. 859, 861, 298 P.2d 162 (1956) (purchaser from one with no title is guilty of conversion). Further, no one can transfer better title than he has. (Id.). Therefore, any individual or entity that acquires possession of previously converted property stands in the same position as the original third-party converter. (Id.). Title continues in the rightful owner of property. Swim, supra, 90 Cal. at 128-131; Woodsend v. Chatom, 191 Cal. 72, 79, 214 P. 965 (1923); Barthelmess v. Cavalier, 2 Cal.App.2d 477, 38 P.2d 484 (1934); Culp, supra, at 861 (one who, even acting in good-faith, purchases 17 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 or acquires property from one having no title thereto or right to transfer such property is guilty of conversion as against true owner). As discussed above, Wikileaks has for its own use and benefit displayed on their Website and posted, re-posted, summarized and used derivative portions thereof of the JB Property, to which Defendants have no right, title or interest (Hiestand Decl. 6, 26). Moreover, Defendants obtained possession of these materials improperly and unlawfully, actively soliciting and encouraging the submission to them of "leaked" confidential bank records. (Spiegel Decl. 4-6). Accordingly, and in light of the circumstances described herein and in order to maintain the status quo, injunctive relief should issue prohibiting Defendants from any further use, display, post and/or dissemination of any of the stolen and converted confidential proprietary JB Property. B. Plaintiffs Have Suffered And Will Continue To Suffer Irreparable Harm Should An Injunction Not Issue. The second factor of the "continuum" test set forth in Iconix, Inc. and Stuhlbarg Int'l Sales Co. and considered by the courts for the issuance of an injunction (as set forth above under Section III), is the "existence of serious questions governing the merits and that the balance of hardships tips in its favor." Iconix, supra, 457 F.Supp.2d at 975 (citations omitted). The factor that "serious questions" be raised has been interpreted as requiring a showing that a "fair chance of success on the merits" exists. Sierra On-Line, Inc. v. Phoenix Software, Inc., 739 F.2d 1415, 1422 (9th Cir. 1984). In addition, the factor of "the balance of hardships," requires merely a showing that the hardship would tip in favor of the moving party. Id; Michaels v. Internet Ent. Group, Inc., 5 F.Supp.2d 823, 838 (C.D. Cal. 1998); Iconix, supra, at 975 ("Under the sliding scale theory, a party seeking an injunction `need not demonstrate that he will succeed on the merits, but must show that his cause presents serious questions of law worthy of litigation.'"). /// 18 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 Plaintiffs have demonstrated that they are likely to prevail on the merits of both their conversion claims and their unfair competition and business practices claims for violations of Swiss, Cayman Islands and California and federal privacy laws. Plaintiffs have further demonstrated that they have suffered and will continue to suffer irreparable harm at the hands of the Defendants. Here, money damages would not adequately compensate Plaintiffs for continued and future anticipated violations by Wikileaks because it would be difficult, if not impossible, to quantify the damage to Plaintiffs' reputations and to prove the loss of specific clients and business opportunities resulting from the Defendants' continued, further and future dissemination of the JB Property. AT&T Communications of Cal. v. Pacific Bell, 1996 WL 940836, 11 (N.D. Cal 1996) (preliminary injunction issued, based in part, on loss of control of plaintiff's trade secrets, which is itself an irreparable harm) citing Peripheral Devices Corp. II v. Ververs, 1995 U.S. Dist Lexis 11389, 27-28 ("once information loses its confidentiality, there is no amount of money or effort that will make it confidential again"). See also, Perfect 10, Inc. v. Cybernet Ventures, Inc., 213 F. Supp. 2d 1146, 1190 (C.D. Cal. 2002) ("In copyright and unfair competition cases, irreparable harm is presumed once a sufficient likelihood of success is raised") citing Micro Star v. Formgen, Inc., 154 F.3d 1107, 1109 (9th Cir. 1998); Heckmann v. Ahmanson, 168 Cal.App.3d 119, 214 Cal.Rptr. 177 (1985) (injunction against disposing of property is proper if disposal would render the final judgment ineffectual); Gladstone v. Hillel, supra, 203 Cal. App. 3d at 988-89 (citations omitted) (tortfeasors owe the person they have wronged a duty to avoid further harm through exploitation of converted property); BP Chemicals Ltd. v. Formosa Chemical & Fibre Corp., 229 F.3d 254, 263 (3rd Cir. 2000) (injuries to reputation are difficult to calculate, and thus money damages are an inadequate remedy; injury to goodwill is irreparable). In addition, the factor of "the balance of hardships" clearly tips in Plaintiffs' favor. If an injunction is immediately granted, Defendants will merely be required 19 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 to do what they are already legally obligated to do -- not use, display or disseminate the confidential bank records which comprise the JB Property. To be prohibited from engaging in wrongdoing is not a hardship. See, Caterpillar, Inc. v. Nationwide Equip., 877 F. Supp 611, 617 (M.D. Fla. 1994) (in trademark context, "Defendants will suffer no harm from being restrained from doing that which is illegal"). On the other hand, the continued dissemination of the JB Property continues to and further harms Plaintiffs' reputations and businesses, its customers' confidence in the bank, its customer banking relationships and could potentially undermine the banks' ability to effectively operate, among other harms. With every day, Defendants continue to display and further disseminate private information found within the JB Property and attempt to further capitalize on and exploit their unlawful conduct to increase their Website's traffic, furthering the irreparable harm suffered by Plaintiffs. The print-outs of the "history" pages of the posts related to the JB Property show that Wikileaks is responsible for the posts, and engaged in numerous edits and revisions to the posts. (Spiegel Decl. 9, 15, Exhs. "C" and "E"). A long comment post dated February 4, 2008, apparently from Elmer writing in the third-person, states that: "Elmer might be inveigled into supporting or even executing a terrible act of destruction of human lifes [sic] as other did in Zurich (Tschanun case 7 deaths, Kantonalbank Zurich three deaths etc.)"; and "It is believed that there are many other cases [documents] to surface in the next few weeks." (emphasis added). The statements are clear that, absent injunctive relief, additional JB Property will be posted, furthering the irreparable harm suffered by Plaintiffs. (Id., 15, Exh. E). Further, Defendants' intentional conduct of creating a "means for anonymous and untraceable leaking of documents," regardless of legality, renders injunctive /// /// 20 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 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 relief all the more appropriate.3 See, Ocean Garden, Inc. v. Marktrade Co., Inc., 953 F.2d 500, 508 (9th Cir. 1991) (balance of hardships favors plaintiff where there is "substantial evidence" of defendant's "bad faith," by intentional infringement). Here, Defendants' possession of, use and dissemination of hundreds of stolen confidential bank records and documents, which belong to Plaintiffs, in violation of the applicable Swiss and Cayman Islands privacy laws and the California Constitutional right to privacy, has resulted in irreparable harm to Plaintiffs. The injunctive relief requested is therefore necessary and appropriate. III. PLAINTIFFS SHOULD BE REQUIRED TO POST NO, OR ONLY A MINIMAL, BOND IN LIGHT OF DEFENDANTS' CONDUCT In construing the language of Federal Rule of Civil Procedure, Rule 65(c), the courts have stated that, "especially in view of the phrase `as the court deems proper' the district court may dispense with security" where the district court determines that the risk of harm is remote, or that the circumstances otherwise warrant it, or that there has been no proof of likelihood of harm to the party enjoined. The Court has the discretion to require only a nominal bond, or even no bond at all. See, e.g., International Controls Corp. v. Vesco, 490 F.2d 1334, 1356 (2d Cir 1974) (approving district court's fixing bond amount at zero in the absence of evidence regarding likelihood of harm) citing Ferguson v. Tabah, 288 F.2d 665, 675 (2d Cir. 1961); Urbain v. Knapp Brothers Mft'g Co., 217 F.2d 810 (6th Cir. 1954), cert. denied, 349 U.S. 930, 75 S.Ct. 772 (1955). See also, GoTo.com, Inc. v. The Walt Disney Co., 202 F.3d 1199 (9th Cir. 2000) ($25,000 bond required to enjoin use of defendant's logo and commercial website which infringed on pay-forplacement search engine website's logo). 3 It also makes it necessary to issue injunctive relief requiring Dynadot to remove the DNS records to prevent the website from displaying the JB Property until such time as the Wikileaks defendants stop hiding behind anonymity and comply 28 with the law and the Court's order. 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 21 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ. 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 Based on the above, including that injunctive relief will not cause any economic or other harm to Defendants, it is respectfully requested that the Court require that Plaintiffs post no bond, or, at most, only a nominal bond in connection with the requested injunctive relief. IV. CONCLUSION Based on the foregoing, Plaintiffs respectfully request that this Court issue a Temporary Restraining Order and Order to Show Cause Re Preliminary Injunction in the form set forth in the [Proposed] Temporary Restraining Order and Order to Show Cause re Preliminary Injunction submitted herewith, and for such other alternative and further relief as the Court may deem to be just and appropriate. Respectfully submitted, DATED: February 7, 2008 LAVELY & SINGER PROFESSIONAL CORPORATION MARTIN D. SINGER WILLIAM J. BRIGGS, II EVAN N. SPIEGEL /s/ William J. Briggs, II By:________________________________ WILLIAM J. BRIGGS, II Attorneys for Plaintiffs BANK JULIUS BAER & CO. LTD and JULIUS BAER BANK AND TRUST CO. LTD 4405-2\Ple\APPL-P&A TRO-INJ 0208008 CV08-0824 JSW 22 PLAINTIFFS' P's & A's RE APPL. FOR TRO & PRELIM. INJ.

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