DS9 Document EFTA00801365

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 IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT, IN AND FOR PALM BEACH COUNTY, FLORIDA Case No. 502009CA040800XXXXMB JEFFREY EPSTEIN, Plaintiff/Counter-Defendant, vs. SCOTT ROTHSTEIN, individually; BRADLEY EDWARDS, individually, Defendants/Counter-Plaintiffs. TRANSCRIPT OF PROCEEDINGS DATE TAKEN: Wednesday, February 28th, 2018 TIME: 9:54 a.m. - 11:06 a.m. PLACE 205 N. Dixie Highway, Room 10D West Palm Beach, Florida BEFORE: Donald Hafele, Presiding Judge This cause came on to be heard at the time and place aforesaid, when and where the following proceedings were reported by: Sonja D. Hall Palm Beach Reporting Service, Inc. 1665 Palm Beach Lakes Boulevard, Suite 1001 West Palm Beach, FL 33401 PALM BEACH REPORTING SERVICE, INC. EFTA00801365 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 APPEARANCES: For Plaintiff/Counter-Defendant: LINK & ROCKENBACH, P.A. 1555 Palm Beach Lakes Boulevard, Suite 301 West Palm Beach, FL 33401 By KARA BERARD ROCKENBACH, ESQUIRE For Defendant/Counter-Plaintiff: SEARCY, DENNEY, SCAROLA, BARNHART & SHIPLEY, P.A. 2139 Palm Beach Lakes Boulevard West Palm Beach, FL 33409 By DAVID P. VITALE JR., ESQUIRE PALM BEACH REPORTING SERVICE, INC. EFTA00801366 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 THE COURT: I haven't seen this before today. How come this wasn't provided to me, all the materials here? MS. ROCKENBACH: I believe it was hand- delivered to Your Honor. I have to check with my office, Your Honor. But I know that a hand-delivery of today's UMC and tomorrow's UMC was delivered to your chambers. MR. VITALE: We received the email copy. THE COURT: Okay. You have to wait, if you'll like to stick around. I don't have time to read it right now and this will make a moment. MS. ROCKENBACH: It's a very significant issue, so take your time. THE COURT: It's 11 pages. I can't read it now. I will have some time later. MS. ROCKENBACH: Thanks, Your Honor. THE COURT: You're more than welcome. (A recess was had 8:55 a.m. - 10:10 a.m.) THE COURT: I have had a chance to read the Plaintiff/Counter-Defendant Epstein's Motion for Protective order and in Limine of PALM BEACH REPORTING SERVICE, INC. EFTA00801367 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 Unrelated Settlement. Just as a preface to the arguments, I think I largely dealt with this as a result of my three-page order dated 5 January of this year where I ruled -- and I have no real plans to deviate from that ruling -- and indicated at that time, in a footnote that I handwrote, because of competing orders that were offered, that I reviewed the hearing transcript at that juncture and found that Epstein shall produce to Edwards the following: The number of claims settled by Epstein regarding individuals who were alleged to be victims of sexual misconduct by Epstein from December 6th, 2007 to December 6th, 2009; the gross settlement amount by Epstein to individuals who are alleged to be victims of sexual misconduct by Epstein from December 6th, 2007 to December 6th, 2009; the number of claims settled by Epstein regarding individuals who were alleged to be victims of sexual misconduct by Epstein from December 7th, 2009 to present; the gross settlement amount paid by Epstein to individuals alleged to be PALM BEACH REPORTING SERVICE, INC. EFTA00801368 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 victims of sexual misconduct by Epstein from December 7th, 2009 to the present. I further ruled that "The number of claims and amounts shall be produced as confidential, for attorneys' and clients' eyes only, and shall not, directly or indirectly, be disclosed to anyone else or used outside of this litigation. "If a party intends to quote, disclose, rely on or use in this litigation information or documents that have been deemed 'Confidential, for attorney's and clients' eyes only,' whether in papers filed with the Court or verbally, in connection with a motion, hearing, deposition or trial, before any such information is quoted, disclosed, relied upon or used, the party must file a motion to have the information or documents deemed to be no longer confidential, must file the information or documents under seal in accordance with Administrative Code 2.303-9/09 and have the proposed quote, disclosure, reliance or use of such information or documents heard and approved by the Court." PALM BEACH REPORTING SERVICE, INC. EFTA00801369 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 I deferred ruling on the admissibility of the number of claims and the gross settlement amount pursuant to this order and the admissibility of the combined settlement amounts of Edwards' three clients for whom Edwards was prosecuting civil cases against Epstein at the time Epstein filed the December 7th, 2009 lawsuit against Edwards. "No production of the underlying settlement agreements with each of Edwards' three clients or with any other alleged victim is required by this order. The Court defers ruling on whether there will be further disclosure of any breakdown of the settlement amounts paid by Epstein." Then, "Epstein shall file a new motion addressing separately the admissibility of the aggregate settlement amounts paid by Edwards'..." strike that. "... paid to Edwards' three clients and the gross settlement amounts disclosed pursuant to this order. "The motion should also address Epstein's position as to the production of PALM BEACH REPORTING SERVICE, INC. EFTA00801370 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 any settlement agreements underlying any settlements paid by Epstein and outline the confidentiality provisions governing those agreements. "To the extent that disclosure of any such provision is subject to confidentiality, disclosure shall be made under seal in accordance with ..." that same administrative order. So this is essentially a follow-up to that. MS. ROCKENBACH: Thank you, Your Honor. Yes. And I appreciate -- MR. VITALE: May I have just one clarification, Your Honor? Were you able to review the response in opposition? THE COURT: I did. MR. VITALE: Thank you, sir. THE COURT: Sure. MS. ROCKENBACH: Thank you, Your Honor. And I appreciate Your Honor reading the January 5th discovery order. Also, two things have occurred since the January 5th order. One, this Court PALM BEACH REPORTING SERVICE, INC. EFTA00801371 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 ruled -- I believe it was last week, with my co-counsel Scott Link present -- that the number of individuals before 2009 and the number of individuals after 2009 are admissible, just the number of claimants, not the amounts. That was the ruling. And there was some discussion about whether amounts were in, not in, there was a request for us to stipulate. And I am sure that my co-counsel was concerned about his appellate counsel being upset about the preservation issue. So we respect what this Court ruled with regard to that particular ruling on the number of claimants pre-2009 and the number of claimants post 2009. We respected and maintained our objection. The reason that Your Honor made that ruling was that Edwards argued to this Court that it was necessary to prove to the jury Edwards' motivation for filing a lawsuit against -- Epstein's motivation for filing a lawsuit against Mr. Edwards. And so that was what prompted Your Honor's ruling. The second transaction or occurrence PALM BEACH REPORTING SERVICE, INC. EFTA00801372 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 since the January 5th order was right before this hearing, Mr. Vitale -- and I thank him for this -- advised me that Mr. Edwards will not be seeking admissibility of the amounts of the other tort claimants, meaning other than Edwards' three. MR. VITALE: If I could clarify that. Sorry. The statement that I made was regarding the relief that was being sought in this motion in limine, which was the individual amounts. The individual names we are no longer -- I am not opposing that relief in my opposition. As to the gross number of the dollar value pre-December 7th, 2009 and post December 7th, 2009, that's the subject of a second motion to lift confidentiality designations. THE COURT: As a corollary to my rulings -- and if I haven't made that clear yet, I will -- now, I have no intention of unsealing the confidentiality provisions of claims that were not handled by Mr. Edwards. The only thing that I believe is PALM BEACH REPORTING SERVICE, INC. EFTA00801373 10 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 appropriately admissible as to the malicious prosecution claims, and how this type of case differs from the norm when we are talking about comparators, and that is, that in most of the cases that have been cited by Mr. Epstein, in his moving papers that I have been given today, the introduction of those similar types of settlements have typically been barred, either by the trial courts or by the appellate courts, because they are interrelated to the claim at issue. Meaning, while they are -- they are the subject of a claim at the issue, better stated. Meaning that, in most situations, everyone's case is different. And to try to use comparison settlements in those types of settings, i.e., where one individual may have resolved a case under similar circumstances with the same defendant, it's really, in most situations, irrelevant to the actual claim made by the plaintiff at bar, because of the significant differences, in most situations, in one party's damages and another. PALM BEACH REPORTING SERVICE, INC. EFTA00801374 11 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 The reason for the Court's general ruling, that I have made and willing to expound upon today, as to allowing the gross settlement amounts, both before and after the filing of the lawsuit by Mr. Epstein against the Rothstein firm and Mr. Edwards and III., individually, reflects, at least from a relevancy standpoint, i.e., does it touch on a fact at issue, is the legal elements that Mr. Edwards must prove in his malicious prosecution claim, and one is proximate cause; and then as a corollary to that, malice. So that has always been the idea behind the Court's global ruling that will not disturb, because of the Court's sensitivity, in large part understanding the issue well, but also, as directed by the appellate courts, that settlement offers that contain confidentiality clauses must be respected, and there may also be a Florida constitutional argument regarding the impairment of contracts, if the Court was to disturb that confidentiality provision. So the Court is sensitive and respectful to PALM BEACH REPORTING SERVICE, INC. EFTA00801375 12 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 those confidentiality provisions. The ruling, though, is that the number of claims that Mr. Epstein settled for the exposure that he had after in the aggregate, which were later converted then into actual settlement of dollars, that aggregate, I continue to maintain, would be admissible and is relevant to Mr. Epstein's motive. And again, the time of this filing is critical to the Court's analysis. I have made that clear on numerous occasions. This was all going on at or near the time that the Rothstein firm imploded; that Mr. Rothstein and many members of the firm were implicated in this Ponzi scheme, which was the largest in the State of Florida; which Mr. Rothstein is now going hard time; from my anecdotal observations, quite deservedly so; and there was a chaotic condition at that office as a result of the raids that were being done to confiscate -- not confiscate. Poor word. -- to secure every piece of evidence that the respective government agencies were seeking against Mr. Rothstein, and perhaps all of the PALM BEACH REPORTING SERVICE, INC. EFTA00801376 13 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 tentacles that Rothstein had as a result of this massive Ponzi scheme, that went to the very heart of the whole idea of personal injury claims, and the factoring of these claims and things of that nature. And so while Mr. Epstein has every right to state his position as to why he filed the lawsuit, as I have also mentioned on several occasions, Mr. Edwards has the conterminant obligations to be able to use whatever evidence that is relevant in order to show what is a significant burden here, and one that has been suggested by courts of this jurisdiction and others to be often a very difficult one. And that is, in large part, the probable cause. And again, as a corollary, the malice, that may have existed to what is, at least, some relevant proof of that -- or those elements. But in large part, the financial exposure, the potential embarrassment and publicity that Mr. Epstein was facing, to some degree, as far as the publicity and the embarrassment, that Mr. Edwards was also facing. PALM BEACH REPORTING SERVICE, INC. EFTA00801377 14 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 The theory being, as espoused by Mr. Edwards in his malicious prosecution claim, that Mr. Epstein was striking while the iron was hot. And that when somebody is down, when somebody is potentially suffering, when someone is weakened -- whether it be he himself believed he was implicated or not, this was massive. This was publicized. This was known throughout the country, Rothstein's antics after this all broke, going to Morocco, I believe, on a plane, and having to be talked back into the country by his wife, as I recollect. Having handled those cases, the state claims -- my division before I moved to juvenile -- I saw firsthand what transpired, and had a significant interest in knowing all of the facts and circumstances, because I was handling this case at the time. I remember handling Mr. Edwards' withdrawal from -- I guess, withdrawal from the Rothstein firm, and coming in indicating he was filing a notice of appearance on either himself or his own firm or joining another outfit. I can't remember. I do PALM BEACH REPORTING SERVICE, INC. EFTA00801378 15 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 remember that time period very strikingly. So, I think that's where we are. I am more than willing to hear further argument as far as whittling down or more carefully structuring the Court's decision here. But globally, that's where I am, for the reasons I just stated, which has been stated in the past. Ms. Rockenbach. MS. ROCKENBACH: Thank you, Your Honor. I think I just lost my motion, but I don't want to reargue anything that the Court has ruled. THE COURT: It is an 11-page motion, so if I left anything out or if I have not touched on things that need to be further touched on, you know you have full carte blanche to let me know, because of the respect that I have for you and for plaintiff -- defense counsel -- counter-plaintiff's counsel, you are never encroaching upon the Court's patience when it comes to trying to get this right, which is all I am trying to do. MS. ROCKENBACH: Thank you. I PALM BEACH REPORTING SERVICE, INC. EFTA00801379 16 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 appreciate that, Your Honor. And I also respect this Court's ruling. You did previously rule that the number of claimants were coming in before 2009 and after 2009. THE COURT: But I saw that there was a caveat there regarding more so discovery than it was specific to admissibility. Today I am being asked to determine admissibility, and that's why I expounded, rather lengthily, on that issue. MS. ROCKENBACH: That's correct. And the January 5th order it was the discovery issue. Last week Your Honor did rule at a UMC hearing with Mr. Scarola and Mr. Link, who were present -- we weren't -- Mr. Vitale and I were not -- and your ruling, as I understand it, although we don't have the paper, was that the number of claimants before 2009 and the number of claimants after would be admissible. THE COURT: And the aggregate amounts of the settlements. MS. ROCKENBACH: And so today's motion PALM BEACH REPORTING SERVICE, INC. EFTA00801380 17 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 is in part some overlap of that with regard to respecting the Court's ruling, but also making sure that -- and preserving the objection to any of it coming in based on relevance and probative value and the prejudicial impact to this jury -- there is an additional layer of prejudice, but it's the 90.403 of misleading the jury. THE COURT: Let me answer a couple of those questions now -- MS. ROCKENBACH: Sure. THE COURT: -- because I made some notes while I was reading the materials here. To quell any concerns, you wrote here -- forgive me. I sometimes get confused. Whomever wrote the well-written motion here -- MS. ROCKENBACH: Then it was me. THE COURT: It was actually signed by Mr. Link. It does have your name and Ms. Many, M-A-N-Y -- her name as well, so any of the three of you did a good job -- combined effort. MS. ROCKENBACH: Thank you. THE COURT: But it says, quote, this PALM BEACH REPORTING SERVICE, INC. EFTA00801381 18 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 Court has made it clear that Edwards may try to prove the elements of malice by allowing Edwards to discuss generally the number of pending claims that existed in December 2009 and the financial exposure those claims represented, end quote. I would editorialize this by indicating that to prove the elements of probable cause and as a corollary, malice. But other than that, it's relatively accurate. It then goes on to state, quote, settlement amounts of Edwards' three tort claimants have zero relevance to Edwards' burden of proof, and evidence of any other tort claimants' settlements obviously even less. Rather, they are being sought to tarnish the jury's view of Epstein and inflame the jury against Epstein. In other words, Epstein is damned if the amounts are disclosed or not. They will either be so high as admission of great guilt, or too low as further alleged abuse of the civil tort claimants, end quote. So what I have wrote here is that I PALM BEACH REPORTING SERVICE, INC. EFTA00801382 19 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 made it clear to Mr. Scarola and Mr. Vitale -- and I will continue to make it clear -- that there will be no pejorative, there will be no extraneous or other inappropriate comments. When I use the word inappropriate, what I mean by that is not that I have ever heard either of them make inappropriate comments, at least since the Court has harnessed Mr. Scarola relative to some of the words -- descriptions he has leveled at Mr. Epstein -- but those have stopped after I made that pretty clear. But the contemplation is to solely utilize the amounts of the settlements in the three cases at issue. And remember, it has to also be emphasized, as Mr. Vitale, in his response, indicated, that III. was a defendant in the case -- in the Epstein case that was brought against Rothstein, Edwards and III. Her party status is important and has to be explained. But irrespective of that, the reason for the Court's admission of this evidence at this juncture -- we have to talk, PALM BEACH REPORTING SERVICE, INC. EFTA00801383 20 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 perhaps, more about how we are going to deal with the gross settlement amounts that Mr. Epstein faced, either exposure or by virtue of the actual numbers paid, the cases where Mr. Edwards was not counsel. The argument is going to be, as I understand it from Mr. Scarola's prior arguments, is that Mr. Epstein, essentially, attempted to chill the bar members, if you will, the attorneys who were bringing these cases, and that Mr. Edwards was, if not actually involved in those cases, was a source or a resource for these cases, and also was, from my recollection, involved in the prosecution of the federal claim that was pending and still is pending pertaining to the Victims' Rights Act. How much that's going to impact upon the Court's analysis here, I'm not sure. But the decision that the Court made regarding the global settlement amounts paid still tends to prove or disprove a material fact, and, that is, the probable cause and corollary malice that will have to be proven up. And again, the burden is significant on PALM BEACH REPORTING SERVICE, INC. EFTA00801384 21 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 the part of the counter-plaintiff Edwards. So this Court will go to great pains in, one, not allowing any type of pejorative comments to be made against Mr. Epstein; two, to ensure that the jury understands, if necessary, the rationale for the Court's admission of this information; and three, that we are not going to go into any detail whatsoever as to the nature of any claims Mr. Edwards was not lead counsel. It is solely to show the exposure that Mr. Epstein faced going forward. It will only be admissible to show the timing of the suit that was brought by Epstein against Edwards, to explain the reasons why, from the counter-plaintiff's side, Edwards' side, why he believed that this suit by Epstein was brought at that critical juncture. And, of course, as to the three claimants: III., Jane Doe and -- the third person that escapes my mind right now -- MR. VITALE: E.W. THE COURT: E.W. Thank you. -- the past exposure -- the past PALM BEACH REPORTING SERVICE, INC. EFTA00801385 22 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 payments that he made, so as to give the jury some idea of Mr. Epstein's mindset. Again, I have to look at this case from both sides. You have the unique perspectives, from your respective sides, to be advocates for your clients. I have to find what I believe to be the most appropriate level playing field so that both sides are adequately able to prove their respective cases. And that's the whole basis for these rulings. So the way I would suggest that this may be incorrect, what I read here from your papers, is why I wanted to clarify or, at least, explain more fully the core reasons for the Court's determination of admissibility. Now, let me ask Mr. Vitale a question. And if you don't know, that's fine as well. As far as III., E.W. and Jane Doe are concerned, have you spoken to them as to whether or not they are willing to waive their side of the confidentiality aspect? MR. VITALE: As to the amount of the settlement payments only? No, I have not. PALM BEACH REPORTING SERVICE, INC. EFTA00801386 23 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 I do not believe Mr. Edwards has. But if that's important to the Court's determination as to whether we can introduce the settlement payments made specifically to III., E.W. and Jane Doe, and also the timing of those payments, we can go ahead and do that. Because, as my response makes clear, in the initial complaint by Mr. Epstein he pleads and alleges that these were weak and minimal-value claims, being used solely to fund a Ponzi scheme, and then he settles them for amounts that have already been -- Your Honor is aware of -- after he knows the Ponzi scheme is over. THE COURT: Pardon me for interrupting. And that's a reason, again, just so the record is clear, for the Court's decision on admissibility, was that specific allegation in Mr. Epstein's initial complaint that gave rise to the malicious prosecution claim by Mr. Edwards, that he identified the three claims held by III., E.W. and Jane Doe, those clients being represented by Mr. Edwards, as weak in nature. And that, PALM BEACH REPORTING SERVICE, INC. EFTA00801387 24 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 again, goes to the timing, in large part, of the action brought by Mr. Epstein against Rothstein, Edwards and III. I appreciate you raising that. Right now -- again, the individual claims that I think are probably going to need to be further scrutinize, but I don't want to leave any loose ends out. So I think that because of the nature of the allegations made by Mr. Epstein against Edwards in the claim initially brought that gave rise to the malicious prosecution action now being tried, that those individual claims will likely be admissible. Again, weighing the confidentiality aspect with the need for that information to be potentially utilized by Edwards in proving up his case against Mr. Epstein. Again, there are references in the actual documents that confidentiality can be overcome. And one is -- I believe it says by rule or by law or something like that. MS. ROCKENBACH: That's correct, Your Honor. It's page three of my motion, "Except to the extent required by law or PALM BEACH REPORTING SERVICE, INC. EFTA00801388 25 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 rule; or in response to a validly issued subpoena from a government or regulatory agency." Goes on to say that the settlement agreement or terms thereof, shall be used or disclosed in any court, arbitration or other legal proceedings, except to enforce the provisions of this settlement agreement. THE COURT: And my position is, certainly, it would have been better had it specifically stated order of the court. But the genesis, if you will, or the underpins of the Court's ruling, is clearly one that is subsumed under section one of the exception. And that is, quote, to the extent required by the law or rule, end quote. By virtue of Mr. Epstein bringing this suit against Rothstein, Edwards and III ., the confidentiality aspect of the individual settlements to which III. was a party, E.W. and Jane Doe also being represented by Edwards at the critical time of this analysis, in my respectful view, would be required by law so as to legally permit PALM BEACH REPORTING SERVICE, INC. EFTA00801389 26 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 Mr. Edwards to be able to fundamentally prove up his case for malicious prosecution. As Mr. Vitale amply points out, Mr. Epstein was the initiator of all of this. This would not have occurred had Mr. Epstein not brought that case in the first place, and then abruptly dismissed it at the eve of summary judgment hearing. So again -- I am not saying that with any judgmental aspect or intent. It's simply pointing out the fact that we wouldn't be here without Mr. Epstein initiating those claims. And so to the extent required by law, to me, a reasonable reading of that sanction would be that now that Mr. Epstein has started the fire, has dismissed his case in chief, has now -- MS. ROCKENBACH: Against Mr. Edwards. THE COURT: Correct. -- has now given rise to the Edwards malicious prosecution claim as a direct, obviously, response to the dismissal of the case in chief against Edwards, to the extent required by law, seems to me to be quite PALM BEACH REPORTING SERVICE, INC. EFTA00801390 27 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 self-evident. And, that is, that these three claims, that were otherwise confidential, is now needed under the law for Mr. Edwards to be able to, in part, prove up his malicious prosecution claims that the six -- I believe it's six elements that are required, most probably here, probable cause and corollary malice. MR. VITALE: Your Honor, I would just point out for the record that in one of Mr. Epstein's interrogatories he requested a breakdown of all the payments made as a result of these settlements, which essentially asks for a copy of the closing statement. In responding to that we obviously need to assert attorney-client and work product privilege. But we were required to disclosed these total settlement amounts already in discovery initiated by Mr. Epstein. I think that's important for the record. THE COURT: Thank you. I didn't know that. I appreciate -- If I did, I didn't remember. Thank you. PALM BEACH REPORTING SERVICE, INC. EFTA00801391 28 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 MS. ROCKENBACH: Your Honor, just to, perhaps close our hearing -- and I appreciate the Court's thoughtful ruling, extensive ruling -- you have denied Epstein's motion to motion in limine regarding the admissibility of the three tort claimants and the amounts paid to them. But I haven't -- the tail end of your ruling did not quite address the other tort claimants. I understand that Your Honor said that -- and cautioned Mr. Edwards' counsel that no detail whatsoever of other tort claimant would come in at trial. I presume that you mean lurid details regarding their claims against Mr. Epstein so as to further inflame the jury. THE COURT: Let's not add something that was not said. None of the details regarding those claims will be admissible. The only details that will be admissible, if you will -- if you want to call them details. I don't think that they are. -- is the aggregate amount of the settlements thus showing at least relevant PALM BEACH REPORTING SERVICE, INC. EFTA00801392 29 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 evidence, i.e., tending to prove or disprove a material fact -- strike that. Material fact being probable cause and the malice corollary. And that is what is the best evidence -- and I am not using best evidence in the traditional sense, but as generically -- and that is, what would be the best way to be able to prove -- or a way to prove Mr. Epstein's exposure at the time he filed his lawsuit, then the proof being in the pudding, i.e., the aggregate settlement amounts that were paid out, so as to demonstrate what could be potentially seen as a chilling effect to all who were -- who were prosecuting claims against him. Now, again, I hate to leave loose ends, but I am going to have to hear a little bit more about Mr. Edwards' involvement in these later cases to be able to really get a flavor for how much I am going to let in. The aggregate sounds like a tempting limit -- a tempting limiting starting point. But if it can be reasonably shown to me that Mr. Edwards had no real involvement in anything other than those three claims, then PALM BEACH REPORTING SERVICE, INC. EFTA00801393 30 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 the Court -- as I have mentioned and as you well know, the appellate courts have been much more prolific in writing about the fluidity of motions in limine until the court gets the full flavor at trial. And I don't think any case that I can think of would be more pertinent to that type of analysis than this one, because there is so many things that are going on in the workings of the case. So, while I made a definitive ruling as to the three claimants that Mr. Edwards was representing, and the fact that the individual settlement amounts, because of the reasoning I have already mentioned, would be permissible and would be an exception to the confidentiality agreement, particularly with the expressed permission of those three claimants, I would feel more comfortable if that is immediately obtained. MR. VITALE: Yes, sir. THE COURT: But other than that, I think that the extent required by law, provision of the exception is something that the Court can hang its hat on comfortably, PALM BEACH REPORTING SERVICE, INC. EFTA00801394 31 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 and I have given you the analysis in that respect. But again, I going to continue to reserve on this aggregate amount until I can figure out what Mr. Edwards' involvement was, a better understanding of how, if at all, Mr. Edwards' continuing involvement, if any, what it may have been, vis-a-vis the time periods. Because it is very hard for me -- as you know and you see what goes on in these hearings -- I try my best to remember as much as I can -- I am talking about even the 8:45s when people asking me to recall things that happened a month ago -- I just don't. We went four trials back-to-back. I mean, since the beginning of the year, four jury trials back-to-back. It wasn't until last Tuesday -- my deputy is my witness -- that during business hours I was able to spend more than a half hour in block time in my office, so the rest of time was out here on the bench. It's sometimes hard to remember everything that goes on, obviously. But what it simply is trying to PALM BEACH REPORTING SERVICE, INC. EFTA00801395 32 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 communicate is I do need to have further information in that regard. MS. ROCKENBACH: Regarding the other tort claimants? THE COURT: Correct. MS. ROCKENBACH: And not only, may I suggest to the Court, you need a flavor, as you say it, for Mr. Edwards' role in those cases, but if the basis or predicate for your ruling is what was motivating Mr. Epstein, it would be important to know whether Mr. Epstein knew Mr. Edwards' role. THE COURT: Remind me of when the settlements of the three -- MR. VITALE: July 2010, Your Honor. THE COURT: And that was -- MR. VITALE: Seven months after the filing of this lawsuit, Mr. Epstein's lawsuit. THE COURT: So the exposure would be, then, what would be at issue at the time Mr. Epstein filed his case against Rothstein, Edwards and III. And then the amounts that were paid after, would serve as proof as to the fact that the claims -- at PALM BEACH REPORTING SERVICE, INC. EFTA00801396 33 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 least what will be argued by the counter-plaintiff Edwards was that the claims weren't weak, that Mr. Epstein faced significant exposure, faced significant exposure for those three cases and other cases. MS. ROCKENBACH: It's the other cases, Your Honor, that you are reserving ruling on until you receive more information or -- THE COURT: Yeah. MR. VITALE: May I seek some clarification? THE COURT: I mean, I did say earlier about the chilling effect. But I am not convinced that that would make much of a difference, because Mr. Edwards, III. and Rothstein were the only ones that were sued. He didn't sue -- Mr. Kuvin, I believe, had cases, Mr. Josefsberg. MS. ROCKENBACH: Mr. Scarola. THE COURT: I didn't know Mr. Scarola had cases. But Mr. Scarola. Under the circumstances, I am still not terribly comfortable with talking about the aggregate. PALM BEACH REPORTING SERVICE, INC. EFTA00801397 34 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 Something you needed clarified, Mr. Vitale? MR. VITALE: Yes, sir. When you're saying the aggregate, are you referring to the aggregate number of claims, or are you referring to the aggregate settlement amounts? THE COURT: Both. MR. VITALE: Because we had a hearing last week where you had ruled admissible the aggregate number of claims. At that hearing Mr. Link had suggested that, well, if those are coming in, we are going to want to tell the jury what the aggregate settlement amounts are, because my client is a billionaire and he's -- THE COURT: And I'm sorry. MR. VITALE: He wanted that stipulation and you wouldn't give it. So I just want -- if that issue is still -- if the Court would like further workup on it, I want to make sure I'm clear. THE COURT: Again, goes to the fluidity of these rulings. It's hard for me -- again -- and I PALM BEACH REPORTING SERVICE, INC. EFTA00801398 35 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 don't mean to make excuses, but when you're carrying the loads that we're carrying, without any dedicated support -- we have the nine staff attorneys assigned to the courthouse to cover the needs of 50 judges or so -- it's hard for me to have anything in a condensed format. Everything that I read, I have to read every page, or I try to read every page. I don't have the luxury of having some dedicated clerk who can digest all of this material and provide me the streamline version of what it is. So the problem that I have often is trying to put into place the dates that all of this took place, i.e., the settlements with the three people that Mr. Edwards represented, vis-a-vis, the time that Epstein filed a lawsuit. That often comes as a bit of a confusion point to me, not the cause by anybody, except my own attempt to try to remember this stuff as best I can. So as I'm listening to it today, as I said, I have no doubt -- and I am comfortable with the ruling regarding the PALM BEACH REPORTING SERVICE, INC. EFTA00801399 36 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 exposure that Mr. Epstein faced prior to his filing of the lawsuit in 2009. The proof in the pudding statement that I made earlier regarding the ultimate resolution of those cases by way of settlement, the least of which I believe is $1 million of the three, and juxtaposing that exposure with the ultimate settlement amounts, so as to show from the counterclaim standpoint, evidence of probable cause, or lack thereof, and malice. The struggle that I'm having right now is what would be the nexus between any of these other outstanding claims and the aggregate settlements of those when Mr. Epstein did not sue any of those other lawyers for any reason that I'm aware of. And you both have clarified and confirmed that, to my knowledge. And also, again, just trying to understand both sides' theories here, that the discreet issue that Mr. Epstein was suing on was what was transpiring as a result of Mr. Rothstein's illegal activities and not having anything to do with any of PALM BEACH REPORTING SERVICE, INC. EFTA00801400 37 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 these other lawyers or claimants that I am aware of. So I don't want to really get into that any more today. I think that I am going to reserve, really, until -- and I don't think I want -- I don't really -- let me think about this for a moment. MR. VITALE: We have the hearing coming up, Your Honor, on March 7th (sic), next Wednesday. THE COURT: Thursday. MR. VITALE: We can take it up them. MS. ROCKENBACH: I think we are trying to confirm it. THE COURT: I reserved Thursday, all day. MS. ROCKENBACH: All day. Okay. Thank you very much. THE COURT: Sure. On the one hand I am trying to not have to overburden myself with anything more than needing to be heard on Thursday with this. But if you want to readdress it then, I -- I guess we should, because it likely could come up in opening statement. PALM BEACH REPORTING SERVICE, INC. EFTA00801401 38 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 MS. ROCKENBACH: Yes. THE COURT: So I will hear kind of the revised, boiled-down motion on just that issue alone. MS. ROCKENBACH: Of the other tort claimants. So Your Honor denied my motion as to Mr. Edwards' three, reserved as to the other tort claimants for today? THE COURT: Correct. And that's the latest ruling that the Court has made. I have been able to better put into perspective today the timing of the respective proceedings that transpired back in 2009 and 2010, and have further contemplated this issue of these other claimants. And, again, I'm just not sure that whatever probative value may be gleaned from that information would not be materially outweighed by the prejudice. And that analysis, I think, applies here. So right now my inclination is to look at it again and get a fresh perspective. I am having more and more doubts that PALM BEACH REPORTING SERVICE, INC. EFTA00801402 39 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 that is something that I am really going to allow in. MR. VITALE: Your Honor, may I ask for one clarification? THE COURT: Sure. MR. VITALE: You had mentioned that for the other -- you had mentioned for the other claims against Mr. Epstein that, obviously, we will not go into detail as to the allegations of those claims. But the primary damage claim against Mr. Edwards is that Mr. Epstein spent attorney's fees defending against discovery he deemed to be not relevant to the three claims being brought by III., E.W. and Jane Doe. That damage claim is obviously barred by the litigation privilege. But, assuming it's bought in, Mr. Edwards, in the defense of the discovery, is going to be that it was relevance to a couple issues. It was relevant to the punitive damages claims on behalf of these three individuals, it was relevant to the modus operandi of Mr. Epstein. PALM BEACH REPORTING SERVICE, INC. EFTA00801403 40 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 So if arguments are made that you tried to depose the pilots, but weren't your three clients not on the planes? Well, yes, that's true. But the reason for the depositions of those pilots will go to -- without getting into detail -- will go to the existence of other claims that there were claims that younger, underage women were on planes with Mr. Epstein. THE COURT: Again, Mr. Vitale, think of it from my standpoint in trying to make sure that this case is very much focused on the malicious prosecution action and only the malicious prosecution action. Now, I have indicated that we can't sanitize this case completely. Both sides have agreed with that. But again, I think you are making my argument for me to some degree when I talk about the 90.403 analysis -- MS. ROCKENBACH: Yes. MR. VITALE: Yes, sir. THE COURT: -- when I'm talking about prejudice versus probative. I am looking at that as -- when it deals with other PALM BEACH REPORTING SERVICE, INC. EFTA00801404 41 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 people -- largely corollary and largely collateral. And also, again, a probative versus probative analysis, too. So that's where the Court is focusing right now. Again, I appreciate the additional discussion today, because it helps me to focus on these dates and timing. When it comes to discreet issues like we are talking about, we will figure it out, I think, as we go along and it becomes much more obvious to me as we go through this -- but sometimes it may be even wiser to just get a ruling from the Court, as far as that issue, during the trial. I mean, the Court may be able to make a definitive determination as to whether or not it's relevant. If it is relevant, then how far we will go into it. I will get a better idea of what's going on during the trial, something that relatively small. And I appreciate the fact that you are using it as an example. MR. VITALE: It is in the complaint. And my understanding is it is part of the argument that Mr. Epstein actually suffered PALM BEACH REPORTING SERVICE, INC. EFTA00801405 42 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 damages. THE COURT: And it can be explained, but it doesn't have to be explained to the extent that those other people were claimants. There is really no relevance there. If there were minors that were on the plane and that gave rise to the need to depose the pilots, I think you can leave it at that. I don't think the need that they were claimants makes any difference, except to potentially inflame the jury. The fact that there was need to take those depositions because they were potentially the minors on the plane, first of all, that would have to be likely shown to me, proffered outside the presence of the jury first. And if there was sufficient predicate then to be established, then we may be able to go into it, but in a much more sanitized fashion, and in a way that wouldn't trigger the fact that they may be claimants. I don't really see the connection. The need to take the depositions can be shown without having to PALM BEACH REPORTING SERVICE, INC. EFTA00801406 43 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 get into any of the litigation details. If there were minors on the plane, that could be established by way of a predicate first, then the likelihood is that I will allow it, but in a limited sanitized version, so as to simply show the need to have taken those depositions, not the fact that there was a claimant onboard, especially, as I understand it, she wasn't a client of Mr. Edwards'. MR. VITALE: No, sir. I believe I understand the distinction. THE COURT: So that is where we are going. MS. ROCKENBACH: Thank you, Your Honor. THE COURT: Go ahead and prepare an order that's going to say what I have indicated, and that is that I am -- pursuant to that exception in the confidentiality agreement, I am allowing, with -- likely with or without, but better with, the permission of the three claimants. Because they may have their own feelings about this. And the likelihood that their names may be mentioned, now that they are adults, at some PALM BEACH REPORTING SERVICE, INC. EFTA00801407 44 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 point during the trial, since the media will be here, could sway them otherwise. So I will need to know. But it is not going to deviate from the Court's global ruling that the aggregate amounts of those settlements would still be admissible, even without the admission of the settlement of the then minors. MS. ROCRENBACH: And that's the aggregate of those three? THE COURT: Correct. The aggregate of those three will still be admitted. The individual claims will be admitted as well. But again, I would prefer to have the permission of the three claimants. I think III. is a done deal, though, because she was a defendant in the case. So I am making that ruling with or without her permission. That goes to, again, the alleged weakness of the claims as well as the motivation for -- potential motivation for Mr. Epstein to have filed the suit in the first place and the issues of probable cause and the corollary malice element. PALM BEACH REPORTING SERVICE, INC. EFTA00801408 45 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 The Court is reserving jurisdiction as to the admissibility of the aggregate claims and aggravate settlement amounts of those who were not represented by Mr. Edwards. As to the other evidentiary matters that may come up with regard to the rationale for taking depositions and other expenditure of resources by Mr. Epstein in the litigation regarding the three claimants represented by Mr. Edwards, the Court will handle each on a matter-by-matter basis. However, with the understanding that it is unlikely that the Court will allow testimony that involves other claimants not represented by Mr. Edwards. However, the rationale for such expenditures will be developed at trial in a sanitized fashion. That pretty much takes us through that motion, correct? MS. ROCKENBACH: Thank you, Your Honor. Yes, it does. Thank you so much. We will prepare -- THE COURT: Nice to see you. MS. ROCKENBACH: Nice to see you, too. THE COURT: Also, thanks to our court PALM BEACH REPORTING SERVICE, INC. EFTA00801409 46 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 reporter for staying overtime. Have a pleasant rest of the week. See you soon. - - - (The above proceedings were concluded at 11:06 a.m.) PALM BEACH REPORTING SERVICE, INC. EFTA00801410 47 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 COURT CERTIFICATE STATE OF FLORIDA ) : SS COUNTY OF PALM BEACH ) I, SONJA D. HALL, certify that I was authorized to and did stenographically report the foregoing proceedings and that the transcript is a true record of my stenographic notes. Dated this 28th day of February 2018. SONJA D. HALL PALM BEACH REPORTING SERVICE, INC. EFTA00801411