DS9 Document EFTA01081024

1 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 JEFFREY EPSTEIN, Plaintiff, vs. IN THE CIRCUIT COURT OF THE FIFTEENTH JUDICIAL CIRCUIT, IN AND FOR PALM BEACH COUNTY, FLORIDA CASE NO.: 502009 CA 040800XXXMBAG SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and L.M., individually Defendants. / HEARING BEFORE: THE HONORABLE DAVID F. CROW DATE TAKEN: Wednesday, September 28, 2011 TIME: 8:15 a.m. - 8:45 a.m. PLACE: Palm Beach County Courthouse 205 North Dixie Highway West Palm Beach, Florida 33401 REPORTED BY: BARBARA L. KENT, RMR, RPR, FPR, CSR-MI Court Reporter and Notary Public ORANGE REPORTING EFTA01081024 2 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 APPEARANCES JOSEPH L. ACKERMAN, JR., ESQUIRE CHRISTOPHER E. KNIGHT, ESQUIRE OF: Fowler, White, Burnett, P.A. APPEARING ON BEHALF OF THE PLAINTIFF, JACK SCAROLA, ESQUIRE OF: Searcy, Denney, Scarola, Barnhart & Shipley APPEARING ON BEHALF OF BRADLEY J. EDWARDS. ALSO PRESENT: Bradley J. Edwards. ORANGE REPORTING EFTA01081025 3 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 PROCEEDINGS * * * * THE COURT: Okay. Have a seat, please. We're here on Epstein versus Rothstein, and it's the Motion to Dismiss. I guess, the second point, as well as your new Motion for Punitive Damages. I have read the motions. I have read all the cases you guys provided to me, and I have read them, too, when they were submitted to me earlier, at least most of them. So I think we should deal with the Motion to Dismiss, first. So, I guess, that is your motion. Mr. Scarola. MR. SCAROLA: Thank you, Your Honor. With the Court's permission, may I address the Court from counsel table? THE COURT: That's fine, yes. Certainly. MR. SCAROLA: Thank you very much. Your Honor, what I think will be most helpful is, if we went through the second amended complaint and addressed what that complaint does or does not do in some detail. Obviously, the introduction, which is ORANGE REPORTING EFTA01081026 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 unnumbered, and does not constitute any of the allegations against Mr. Edwards, is nothing more than a press release incorporated into a pleading, for purposes of cloaking it in litigation, in unity. I think we can effectively ignore it. The first five numbered paragraphs are, basically, jurisdictional, and then paragraphs six, seven, eight, nine, ten, 11, 12, 13, 14, all the way through paragraph 22, are paragraphs that describe in substantial detail the uncontested misconduct of Scott Rothstein, and his involvement in a Ponzi scheme. Paragraph 21 alleges that Mr. Edwards was aware that RRA's offices were monitored and recorded various discussions. Obviously, that is immaterial to any claim of abusive process. And paragraph 22 talks about the level of communications going on within the firm, relating to the prosecution of what clearly was, and continued to be, an extremely important case within the firm. The substantive allegations on which I suggest we must focus, to the extent there's any substance in them at all, begin at paragraph 23. And that paragraph says that, that there were a lot ORANGE REPORTING EFTA01081027 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 of e-mails that went back and forth with regard to the prosecution of this -- these major pending cases within the law firm. There is nothing about that exchange of e-mails that would suggest Mr. Edwards' knowledge of, or involvement in an Ponzi scheme. Paragraph 24 describes a variety of events that clearly have, from Mr. Edwards' perspective, an entirely innocent explanation, and dove-tie him into that Ponzi scheme. But as we're going to see, even if Mr. Edwards were tied into the Ponzi scheme, that's got nothing to do with any damage suffered by the plaintiff, Mr. Epstein. Paragraph 25 says that, given the interdependence of so many RRA lawyers, investigators, and other staff, the wide communications that necessarily accompanied the involvement of so many people, Edwards knew or should have known, there was a Ponzi scheme going on. Well, that clearly is a conclusion that is based upon the pyramiding of a variety of inferences, and is not a reasonable conclusion, based upon the preceding allegations about nothing more than an exchange of e-mails and meetings going ORANGE REPORTING EFTA01081028 6 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 on, none of which, Edwards is alleged to have been involved in, in terms of the -- the attempt to sell investments. Then we get to paragraphs 26, 27, and 28, and we're back to Mr. Rothstein, again. And now we have the abusive process claim against Mr. Edwards. In paragraph 30, we learned that on September 11, 2008, Mr. Edwards filed a state court action on behalf of a client seeking damages. Now, we know that those were legitimate claims. There's no allegation anywhere in this complaint that they were anything other than well-founded legitimate claims. 30 B says that there was a federal court complaint that was filed against somebody with a different name, that because it was filed against somebody with a different name, Mr. Epstein never learned about it. Because not only was it filed against somebody with a different name, it was never served, according to the allegations in the complaint on Mr. Epstein. Now, clearly, there can be no abuse of process, and no damages arising out of a complaint against someone else with a different name that is never served on this plaintiff. ORANGE REPORTING EFTA01081029 7 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 Then we have allegations in 30 C, that state what Mr. Epstein believes about the federal complaint; and he believes that it was filed to show to prospective Ponzi scheme investors. Well, again, assuming those -- assuming that belief to be accurate, and a belief is not an allegation of fact, except as to the subjective understanding of Mr. Epstein. It doesn't say, this is what did occur, it says that's what Mr. Epstein believed occurred. Even assuming that to be the case, the filing of a federal court action to show to somebody else, to defraud someone else, clearly cannot produce damages to Mr. Epstein. And, in fact, when we get to the damage allegations, the only allegation of damages are, that Mr. Epstein was obliged to pay attorney's fees to defend against state court actions taken in the prosecution of the filed and served state court claim. So there can be no causal connection between what is alleged in paragraph 30 C, and any damages to Mr. Epstein. Now, the same is true when we get to paragraph 32. Edwards also made illegal, improper, and perverted use of civil process in order to bolster the case to investors by using it to ORANGE REPORTING EFTA01081030 8 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 conduct unreasonable and unnecessary discovery, making unfounded allegations, and we're going to get to that. That clearly can't be the federal court case, because the federal court case is never served. So we must be talking about the state court case, and paragraph 31 makes reference to the state court case. Then, we take a look at what it is that Mr. Edwards is alleged to have done, that constituted abuse of process. And we go to subparagraphs one through ten, about actions alleged to have been taken directly in the state court action during the course of the prosecution of the state court action, that are alleged to have caused Mr. Epstein to spend money on attorney's fees to defend against those actions alleged to have been directly involved in the prosecution of the state court claim. Now, there is an allegation in paragraph 33 that Mr. Edwards had ulterior motives. Significantly, there is no allegation that these "ulterior" motives were the sole motives involved in all of the actions described in paragraph 32. And these ulterior motives are maintaining a Ponzi scheme, of which Mr. Epstein was never, and could ORANGE REPORTING EFTA01081031 9 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 not have been a victim, because he didn't know about it. So, that's got no relevance, and it's not alleged that it was the sole motive. And then there are two other very curious motives alleged; obtaining funds for the continued investigation and prosecution of the Epstein actions, and obtaining operating revenues so that RRA could continue to operate. Now, I don't know how the plaintiff's law firm business is conducted, but there isn't any law firm that I'm aware of, that doesn't engage in the practice of law for purposes of obtaining funds to investigate and prosecute other cases; or to obtain operating revenue so that the firm could continue to operate. I don't know how that constitutes some form of improper motive, that you are in business to make a profit, and to continue to be able to fund other cases to make profits. So those allegations, even if they were allegations that those were the sole motives, are not allegations of some malicious and improper motivation. That's where the allegations of wrongdoing end, and then paragraph 34 is the -- is the damage paragraph, as a result of Mr. Edwards doing all of ORANGE REPORTING EFTA01081032 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 things to prosecute his legitimate claims. It is alleged that the plaintiff suffered damages by incurring additional and unnecessary attorney's fees. There are four cases that are entirely dispositive of this third attempt to try to fabricate some justification for the extortion attempt that Mr. Epstein began back in 2009, and continues to pursue today. The first of those is, SI Investments versus Payless Flea Market, it appears at tab 18 in the notebook that Your Honor was provided by the defendants. You might just make THE COURT: Okay. Because I didn't see any cases, other than the litigation for those cases cited in your motion. MR. SCAROLA: Your Honor, the Motion to Dismiss incorporates the legal authorities that are described in detail in the Motion to Assert a Claim for Punitive Damages, and all of these cases are cited by both parties. So, SI Investments stands for the following propositions, and these are quotes. Plaintiff must prove that the process was used for an immediate purpose other than that for which it was designed. ORANGE REPORTING EFTA01081033 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 Where the process was used to accomplish the result for which it was intended, regardless of an incidental or concurrent motive of spite or ulterior purpose, there is no abusive process. That's the case the defendants themselves are relying upon. So if you have two motives, one's a good one, because what you want to do is, you want to recover damages against Mr. Epstein for his serial abuse of young children. if you have -- THE COURT: Well, isn't the -- isn't the distinction, or as I understand it, correct me if I'm wrong, but the -- while the initial process may be for profit purpose, the issue on abuse of process is something occurring subsequent. Even though it may be filed for legitimate purpose, the abuse process occurs, as compared to malicious prosecution when it's filed for an improper purpose; right? MR. SCAROLA: In order for an abusive process claim. THE COURT: Right. MR. SCAROLA: To be based upon an initial filing. THE COURT: Right. ORANGE REPORTING EFTA01081034 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. SCAROLA: It must be demonstrated that the sole purpose was an improper purpose. And the case law is, that subsequent use of process where there is a concurrent legitimate purpose, does not constitute an abuse of process. That's the Fourth DCA, 2010 recent law, that clearly describes the scope of an abuse of process claim and the elements involved. THE COURT: Well, it also says, the mere filing of a complaint having process served is not enough to show abusive process. The plaintiff must prove improper use of the process after it issues. MR. SCAROLA: Yes, sir, that's correct. THE COURT: Okay. MR. SCAROLA: Okay. And that's what they attempt to do, when they lay out in paragraph 32, all of these alleged improper uses of the litigation. THE COURT: Where -- where -- I mean, I don't mean to cut you off, but I mean you're running short of time here, and, you know, if we started right on time -- but I do have to give them an opportunity. You said this is the dispositive -- SI Investments is diapositive. I thought you were ORANGE REPORTING EFTA01081035 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 going to talk about damages, but is there something about damages in here? MR. SCAROLA: There are. Your Honor, there are four cases, which together, I suggest are dispositive. THE COURT: Give me the names of them, because I want to read them. MR. SCAROLA: Yes, sir. The next case, and I will hand Your Honor a copy of these others. THE COURT: Are they all in the book here? MR. SCAROLA: They are. Two of them are in the book, I think the third one is, as well. THE COURT: Okay. MR. SCAROLA: Tab number four Levin-Middlebrook is tab number 18. THE COURT: Gotcha. I've read that 1,000 times. MR. SCAROLA: Yes, sir, I'm sure you have. And -- THE COURT: You can give it to me, again, though. MR. SCAROLA: I will be happy to do that. THE COURT: Yeah. This deals with litigation privilege. ORANGE REPORTING EFTA01081036 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. SCAROLA: Yes, sir. It does deal with litigation privilege. Echevarria also deals with the litigation privilege, and Delmonico stands for the proposition that the issues with regard for privilege, are issues of law for the court to determine. And I've provided Your Honor with highlighted copies, I'm providing opposing counsel with highlighted copies, as well. THE COURT: Okay. MR. SCAROLA: The basic point here is, Your Honor, that the litigation privilege is an absolute privilege. Once it is established that the actions occur within the course and scope of the litigation, the privilege applies absolutely as a matter of public policy. The basis of those decisions is, that if there's misconduct in the course of the litigation, if you're taking improper discovery, if you're filing improper motions, there are remedies that are available to the court through the court's inherent power to control its own litigation, through the contempt powers of the court, through Florida Statute 57.105, and through the filing of bar grievances, and it will cripple the system, if ORANGE REPORTING EFTA01081037 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 litigants are obliged to respond to separate litigation, just because somebody is alleged, you notice the deposition that shouldn't have been noticed, you filed a motion that shouldn't have been filed. THE COURT: Are you saying it's a matter of law, there can be no abuse of process by an attorney, then? MR. SCAROLA: No, sir. I'm not saying as a matter of law there can be no abuse of process by an attorney. THE COURT: Just the -- MR. SCAROLA: Because if there -- because the test is, it must be related to the litigation. So, if I were to issue a subpoena to my next-door neighbor in a pending case, just because I want to inconvenience him and bring him down to the courthouse, knowing that he just moved to Florida two weeks ago, and this case involves an automobile accident that occurred three years ago, that he couldn't absolutely know anything about, that would be an abuse of process. THE COURT: Here's my question. MR. SCAROLA: Yes. THE COURT: Whether or not that litigation -- ORANGE REPORTING EFTA01081038 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 and generally speaking, a privilege is an affirmative defense. Whether or not something is, or is not within the process, or within the lawsuit, and falls within the immunity, is certainly something that the judge will have to decide rather than the jury. But it may be dependent on specific facts under specific circumstances, may it not? MR. SCAROLA: It may be. THE COURT: Okay. But you're saying, as a matter of law -- I'm sorry. MR. SCAROLA: I am sorry. I didn't mean to interrupt the Court. THE COURT: I guess what you're saying, it's a matter of law, these allegations are such that I can determine from the law looking at the pleadings themselves, that it falls within the privilege? MR. SCAROLA: First, absolute privilege, as distinguished from qualified privilege. Qualified privilege is -- almost always involves questions of fact, but this is an absolute privilege. And secondly, you can determine from the face of the complaint, that this was related to the litigation itself. ORANGE REPORTING EFTA01081039 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 THE COURT: Okay. MR. SCAROLA: You can see that on the face of the complaint. THE COURT: Okay. MR. SCAROLA: So that's the basis of -- of this dismissal argument, and the -- the allegations of the nature of the damages that were incurred, as well. The nature of the damages are, I had to incur attorney's fees in the context of this litigation. THE COURT: Yes, sir. MR. ACKERMAN: Your Honor, it's our position that the corrected second amended complaint satisfies on its four corners, every element of the tort of abuse of process. We have alleged a misuse of the judicial system through a legal, improper, perverted use of process. We have set those examples out. We have alleged in the complaint, that they were for ulterior purposes, not intended by the law, after the action was, that resulted in damages. We can clearly show that, by looking at paragraph 30 A-C, when the LM case is filed in state court against Mr. Epstein, and it is pending for some time, that this 234-page, 156-count ORANGE REPORTING EFTA01081040 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 complaint is filed in Federal Court seeking in excess of $23 million in damages, and it was against Mr. Epstein. We can prove that. And was intended there, we believe, with highly charged allegations, to assist Mr. Rothstein in attracting investors to invest in the Epstein cases. Mr. Epstein's damages include filing motions to dismiss that. That occurred approximately nine months later. So, on that -- on its face, that is a process that is issued after LM, involving the LM case. We then proceeded to list 32 separate instances of abuse of process, and not all of them are in the state cases, a couple are in the federal cases. Paragraph 33 alleges the motives, and we believe that Mr. Edwards was attempting to assist Mr. Rothstein, which is why all the allegations of Mr. Rothstein's conduct with Mr. Edwards' cases, that Mr. Scarola clearly wants to dismiss as unrelated, are appropriate. Because the Court can see on the face of the complaint that there is a link. Mr. Edwards' investigators, Mr. Edwards' cases are ultimately involved with Mr. Rothstein, with the Ponzi scheme. ORANGE REPORTING EFTA01081041 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 We've also alleged in paragraph 24, and I believe if the Court looks at the 15 e-mails in camera, the Court will see that link; and what Mr. Scarola wants to clearly dismiss as e-mails on a case, is on the day that there is contact with Mr. Rothstein and the investors, Mr. Rothstein extends an e-mail, which we've alleged, to the investors, who subsequently invest in the Epstein cases, which is the purpose we've alleged, not recovering money on a cause of action, that state, here are the causes of action we have against Mr. Epstein. And based on the privileged log information that we've received, you can see Mr. Rothstein asking Mr. Adler, and Mr. Edwards in August, and then again in October, what are the causes of action against Mr. Epstein? On the day that he communicates -- the day that Mr. Rothstein communicates with the investors, there's a series of e-mails that involve Mr. Adler, that involve Mr. Edwards, that involve investigators and other people, contrary to what Mr. Edwards has testified to, that show a clear link that they are providing the information that Mr. Rothstein asked for -- on the causes of action against Mr. Epstein, that he ORANGE REPORTING EFTA01081042 2" 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 subsequently gives to the investors. Now, it is our position that links Mr. Edwards to Mr. Rothstein's scheme. And that therein, provides the necessary element that we can prove that the actions that were taken, that we've alleged to be an abuse of process, aren't protected by any privilege, and were in furtherance of that scheme, as alleged. We've also alleged special damages. The law is very clear, that if a person has to defend themself against the conduct of another party, that they are allowed to come in in separate litigation and claim those damages as special damages. Those have been specifically pled. And right now everything that Mr. Scarola is arguing, are issues of fact that need to be properly pled as affirmative defenses. THE COURT: Let me understand the damages here. The damages are not the defending the lawsuit, because nowhere in here do you contend that the lawsuits are frivolous or not supported by facts. MR. ACKERMAN: No, the damages -- THE COURT: Let me finish. MR. ACKERMAN: I apologize, Your Honor. ORANGE REPORTING EFTA01081043 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 COURT: I think you know where I am going. MR. ACKERMAN: Yes, sir. THE COURT: But there were things done in those lawsuits that were outside of -- or that were an abuse of process, that he had to respond to, or otherwise defend, that he would not have defended but for the alleged abuse of process. MR. ACKERMAN: Correct. THE COURT: Is that the gist of it? MR. ACKERMAN: Yes, sir. THE COURT: Okay. So not defending the underlying lawsuit. MR. ACKERMAN: No. It's defending the specific acts that we have said were outside what was permitted in the lawsuit, that Mr. Edwards did, that we believe we can link to assisting Mr. Rothstein in the Ponzi scheme. THE COURT: Okay. Because the reason I ask that is, because I've read the complaint in detail, and nowhere in there -- because you're alleging an attorney's abuse of defense, but nowhere in there, did you allege that the actions were not not frivolous, or something like that, that you had to defend them. ORANGE REPORTING EFTA01081044 ^9 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. ACKERMAN: I think we did allege that, Your Honor. We alleged that -- THE COURT: That -- the entire, the actions themselves were -- MR. SCAROLA: I think you missed the question. MR. ACKERMAN: I missed the question, Your Honor. THE COURT: Okay. MR. ACKERMAN: I'm alleging that the attorney's fees were incurred, and are claimed defending the inappropriate -- THE COURT: I got you. MR. ACKERMAN: -- use of the system. THE COURT: I understand. MR. ACKERMAN: Not the rest of the case. THE COURT: I gotcha, okay. MR. ACKERMAN: Okay. With regard to the litigation privilege, if the Court looks at those cases, the Court will see that this is an absolute required. There is a predicate in all of those cases that say that if -- if it is done, it must be done as an act bearing -- having some relationship to the proceeding here. We have alleged that is not. ORANGE REPORTING EFTA01081045 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 The immunity only attaches if it's required or permitted by the law. We have alleged that the law does not permit these acts that we have alleged. That is sufficient. And also, would require the Court to make a factual finding, that is sufficient to defeat Mr. Scarola's claim that you can dismiss it, because an affirmative defense appears on the face of the pleadings. THE COURT: You would agree, that ultimately it is a question of law for the Court, whether it falls or does not fall within the -- within the privilege? Perhaps not at this stage, but at some point. MR. ACKERMAN: Not at this stage, but the Court may need to take facts. THE COURT: I understand that. MR. ACKERMAN: Take evidence. THE COURT: The jury is not going to determine whether or not this is -- MR. ACKERMAN: That's correct. I believe that's correct. THE COURT: Okay. Briefly, Mr. Scarola, and it looks like we don't have time for the motion -- on the other -- the other motion, I got 8:45's beginning. ORANGE REPORTING EFTA01081046 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 MR. SCAROLA: I would prefer to take the time on the Motion for Punitive Damages, it will only take me two minutes. Your Honor has read it. THE COURT: I prefer not to do it today. MR. SCAROLA: Okay. THE COURT: And I will tell you why. And I'm going to give you instructions as to why, after reading the materials, I want some further -- further thought on it. Okay? So go ahead, if you want to spend any further time on your motion, just -- I think I got -- i understand both sides. I really do. And this is not -- I mean I understand it, so anything else you want me to know that -- MR. SCAROLA: I would be pleased to answer any other questions you have, or address any concerns that you may have with regard to the motion. THE COURT: Here -- let me, on the punitive damage aspects, here's what I want you to deal with. Okay? Aside from the facts of the allegations -- and here's one of my concerns I want you to address when you reset this hearing, and it's really directed, I guess, at the counterclaim. ORANGE REPORTING EFTA01081047 25 I ruled on the Motion to Dismiss the 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Counterclaim, and I think it was 8:45, it may have been a short hearing. But after reading all this, I have serious concerns as to whether there is a cause of action for abuse of process as pled. And let me suggest to you the reason. As I understand the theory is, that this is, basically, what we used to call in products liability, you know, a slap-suit, or something like that, against somebody. You know, your -- this case, the plaintiff's case is. You're just doing this for the purpose of preventing the valid prosecution of Mr. Edwards' clients' rights. Okay? As I -- and it really gets confusing, is that may -- if that's true, that's a wonderful malicious prosecution suit. I'm not sure it's an abuse of process suit. If you win this case, and the jury finds that this is -- this is a frivolous lawsuit, or it's not valid, or whatever; then, there's a malicious prosecution suit. abuse of process suit? And process suit, because it -- But is it -- is it an if it's not an abuse of where it gets confusing to me -- again, I don't mean to -- because -- because the elements, to give rise to punitive damages, must arise out of the tort itself. Okay? ORANGE REPORTING EFTA01081048 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 And it -- if it -- MR. SCAROLA: If there's no underlying tort, there are no punitive damages. THE COURT: And where the problem arises is, is the maliciousness is in filing the lawsuit, I guess, or filing the lawsuit that essentially is frivolous, and intended for purposes -- so I'm not making a ruling on it. That's one of the issues that came up when I read this stuff. So I would like you, before you reschedule, to talk about that issue. Because it was -- it really wasn't vetted, I guess, originally, to me, anyway. So I will take a look at this and get you a ruling out in a day or two, and you-all reschedule the motion on punitive damages. I'd appreciate it. Okay? MR. SCAROLA: I will tell you, Your Honor, that this has been extensively argued before the Court. It wasn't just an 8:45 hearing, and the Motion to Dismiss the Counterclaim was denied following those arguments. But I understand that, in effect, what you are saying is, you are sui sponte, reconsidering that, and we'd be to address it. happy ORANGE REPORTING EFTA01081049 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 THE COURT: Well, let me put it this way. Maybe, perhaps, I didn't understand. I mean, the Courts have problems, at least at the trial level, on the differences, and the distinctions between malicious prosecution and abuse of process, and which ones are dichotomy that dovetail, and I just want to make sure that that is completely vetted before we get to the issue -- or when we get to the issue of damages. MR. SCAROLA: Yes, sir. THE COURT: Okay. MR. ACKERMAN: Thank you, Your Honor. THE COURT: Thank you, guys. (Hearing concluded at 8:45 a.m.) (Court came back at 8:48 a.m., added to the record, reported by Christine Phipps, Phipps Reporting, 85171 Legend Club Drive, West Palm Beach, FL, 33412, 888.811.3408.) ORANGE REPORTING EFTA01081050 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 CERTIFICATE STATE OF FLORIDA COUNTY OF PALM BEACH I, Barbara L. Kent, RMR, RPR, FPR, CSR-MI, Court Reporter, certify that I was authorized to and did stenographically report the foregoing proceedings and that the transcript is a true and complete record of my stenographic notes. Dated this 28th day of September, 2011. 434cuhautilitix BARBARA L. KENT CERTIFIED COURT REPORTER ORANGE REPORTING EFTA01081051 1 WORD INDEX < $ > $23 18:2 < 0 > 040800XXXMBAG 1:3 < 1 > 1,000 13:17 11 4:8 6:8 12 4:8 13 4:8 14 4:8 15 19:2 156-count 17:25 18 10:11 18. 13:16 < 2 > 2008 6:8 2009 10:8 2010 12:6 2011 1:13 2011. 28:10 205 1:15 21 4:13 2139 2:8 22 4:9, 17 23. 4:24 234-page 17:25 24 5:7 19:1 25 5:14 26 6:4 27 6:4 28 1:13 6:4 28th 28:10 < 3 > 30 6:7, 14 7:1,21 17:23 31 8:6 32 7:23 18:12 32, 12:16 32. 8:23 33 8:19 18:16 33401 1:/6 2:4 33409 2:8 33412, 27:17 34 9:24 < 6 > 502009 1:3 561 2:5, 9 57.105 14:24 < 6 > 686-6300 2:9 < 7 > 777 2:4 < 8 > 8:15 1:14 8:45 1:14 25:2 26:20 27:14 8:45's 23:24 8:48 27:15 802-9044 2:5 85171 27:17 888.811.3408. 27:18 < 9 > 901 2:3 < A > a 6:15 13:9 14:15 15:9 16:10 18:22 25:4, 19 26:14 a.m 1:14 27:15 a.m. 1:14 27:14 able 9:17 about 5:3 absolute 14:12 16:19, 22 22:20 absolutely 14:15 15:21 abuse 6:22 8:10 11:9, 14, 17 12:5, 7 15:7, 10, 22 17:15 18:13 20:6 21:6, 8, 22 25:5, 16, 21, 21 27:5 abusive 4:16 6:6 11:4, 20 12:11 A-C 17:23 accident 15:20 accompanied 5:17 accomplish 11:1 accurate 7:6 ACKERMAN 2:2 17:12 20:23, 25 21:3, 9, 11, 14 22:1, 7, 10, 14, 16, 18 23:14, /7, 20 27:12 act 22:23 action 6:9 7:12 8:13, 14 17:21 19:10, 11, 17, 25 25:5 actions 7:18 8:11, 16, 23 9:7 14:13 20:5 21:23 22:3 acts 21:15 23:3 added 27:15 additional 10:3 address 3:17 24:16, 23 26:25 addressed 3:23 Adler 19:15, 20 affirmative 16:2 20:17 23:7 after 24:7 again, 13:21 against 6:16 19:11 ago 15:19, 20 agree 23:9 ahead 24:10 allegation 6:11 7:6, 15 8:19, 21 allegations 4:2, 22 5:24 6:20 7:1, 15 8:2 9:19, 20, 21, 23 16:15 17:6 18:5, 18 24:22 allege 21:23 22:1 alleged 6:1 7:20 8:9, 12, 14, 16 9:3, 5 10:2 12:17 15:2 17:16, 19 19:1, 7, 9 20:6, 9 21:8 22:2, 24 23:2, 4 alleged. 20:8 alleges 4:13 18:16 alleging 21:21 22:10 allowed 20:12 ALSO 2:12 am 21:1 amended 3:22 17:13 an 5:5 11:2 12:22 15:7 16:1 21:21 25:20 and 1:8 3:4 4:14, 16, 19 6:4 7:18 10:8 16:22 19:15 23:22 25:5 27:5 28:7 answer 24:15 any 4:23 10:14 24:16 anyway. 26:13 apologize 20:25 APPEARING 2:6, 10 appears 10:11 23:8 applies 14:15 appreciate 26:16 appropriate 18:21 approximately 18:8 are 9:20 10:18, 20 11:5 13:4 26:23 are, 4:6 argued 26:19 arguing 20:15 argument 17:6 arguments 26:22 arises 26:4 arising 6:23 as 16:19 17:7 18:20 20:16 Aside 24:22 ask 21:19 asked 19:24 asking 19:15 aspects 24:20 Assert 10:19 assist 18:5, 17 assisting 21:17 assuming 7:5, 5, 11 at 17:22 attaches 23:1 attempt 6:2 10:6, 8 12:16 attempting 18:17 attorney 15:8 attorney. 15:11 attorney's 7:17 8:15 10:3 17:10 21:22 22:11 attracting 18:5 August 19:15 authorities 10:18 authorized 28:6 automobile 15:19 available 14:21 aware 4:14 9:11 < B > back 5:1 6:5 10:8 27:15 bar 14:25 BARBARA 1:17 28:5, 18 Barnhart 2:7 based 5:22, 24 ORANGE REPORTING EFTA01081052 2 11:23 19:13 basic 14:11 basically 4:7 25:8 basis 14:17 17:5 be 7:5 16:6 22:22 be. 16:9 BEACH 1:2, 15, 16 2:4, 8, 8 27:17 28:3 bearing 22:23 been 6:1 15:3 began 10:8 beginning. 23:25 BEHALF 2:6, 10 6:9 belief 7:5, 6 believe 18:4, 17 19:2 21:17 23:20 believed 7:9 believes 7:2, 3 between 27:4 bolster 7:25 book 13:11, /3 Boulevard 2:8 BRADLEY 1:7 2:10, 12 Briefly 23:22 bring 15:17 Burnett 2:3 business 9:10, 16 by 15:10 20:21 < C > CA 1:3 call 25:8 camera 19:3 can 18:21 20:4 CASE 1:3 4:20 7:11, 25 8:4, 4, 6 11:5 12:3 13:9 15:16, 19 17:23 19:5 25:11, 11, 17 case. 8:7 18:11 22:16 cases 3:9 5:3 9:13, 18 10:5, 15, 15, 20 13:4 18:14, 24 19:9 22:20, 22 cases, 18:19 cases. 18:6, 15 causal 7:20 cause 19:10 25:5 caused 8:15 causes 19:11, 16, 25 certainly 16:5 Certainly. 3:19 CERTIFIED 28:18 certify 28:6 charged 18:4 children 11:10 Christine 27:16 CHRISTOPHER 2:2 CIRCUIT 1:1, 1 circumstances 16:8 cited 10:16, 21 civil 7:24 claim 4:16 6:6 7:19 10:19 12:7 20:13 23:6 claim. 8:18 11:21 claimed 22:11 claims 6:10 claims. 6:13 10:1 clear 19:23 20:10 clearly 4:19 5:8, 21 6:22 7:13 8:3 12:6 17:22 18:20 19:4 client 6:9 clients 25:13 cloaking 4:4 Club 27:17 come 20:12 communicates 19:18, 19 communications 4:18 5:17 compared 11:17 complaint 3:22, 23 6:11, 15, 21, 23 7:3 12:10 16:24 17:13, 19 18:1, 22 21:20 complaint. 17:3 complete 28:8 completely 27:7 concerns 24:17, 23 25:4 concluded 27:14 conclusion 5:21 conclusion, 5:23 concurrent 11:3 12:4 conduct 8:1 18:19 20:11 conducted 9:10 confusing 25:14, 22 connection 7:20 constitute 4:1 12:5 constituted 8:10 constitutes 9:15 contact 19:5 contempt 14:23 contend 20:20 context 17:10 continue 9:8, 14, 17 continued 4:20 9:5 continues 10:9 contrary 19:22 control 14:22 copies 14:8, 9 copy 13:10 corners 17:14 correct 11:12 23:20 correct. 12:13 21:9 23:21 corrected 17:13 could 8:25 counsel 3:18 14:8 Counterclaim 25:2 26:21 counterclaim. 24:25 COUNTY 1:2, 15 28:3 couple 18:14 course 8:13 14:14, 18 COURT 1:1, 17 3:3, 18, 19 6:8, 14 7:12, 17, 19 8:4, 4, 6, 7, 13, 14, 18 10:14 11:11, 22, 25 12:9, 14, 19 13:6, 11, 14, 17, 21, 24 14:5, 10, 21, 23 15:6, 12, 23, 25 16:10, 14 17:1, 4, 11, 24 18:1, 21 19:2, 3 20:18, 24 21:1, 4, 10, 12, 19 22:3, 9, 13, 15, 17, 19, 20 23:5, 9, 10, 15, 16, 18, 22 24:4, 6, 19 26:4, 20 27:1, 11, 13, /5 28:5, 18 Court. 16:13 Courthouse 1:15 15:18 Courts 27:3 Court's 3:17 14:21 cripple 14:25 CROW 1:12 CSR-MI 1:17 28:5 curious 9:4 cut 12:20 < D > damage 5:12 7:15 9:24 24:20 damages 6:9, 23 7:14, 16, 21 10:2, 20 11:9 13:1, 2 17:7, 9, 22 18:2, 7 20:9, 13, 13, 18, 19, 23 24:2 25:25 26:16 Damages. 3:7 26:3 27:9 DATE 1:13 Dated 28:10 DAVID 1:12 day 19:5, 17, 18 26:15 28:10 DCA 12:6 deal 3:12 14:1 24:20 deals 13:24 14:2 decide 16:6 decisions 14:17 defeat 23:6 defend 7:17 8:16 20:10 21:7, 25 defendants 10:13 11:5 Defendants. 1:9 defended 21:7 defending 20:19 21:12, 14 22:12 defense 16:2 21:22 23:7 defenses. 20:17 defraud 7:13 Delmonico 14:3 demonstrated 12:1 denied 26:21 Denney 2:7 dependent 16:7 deposition 15:3 describe 4:10 described 8:23 10:19 describes 5:7 12:6 designed. 10:25 detail 4:10 10:19 detail, 21:20 detail. 3:24 determine 16:16, 23 23:19 determine. 14:6 dichotomy 27:6 did 7:8 28:6 ORANGE REPORTING EFTA01081053 3 did, 21:16 differences 27:4 different 6:16, 17, 19, 24 directed 24:25 directly 8:12, 17 discovery 14:19 discovery, 8:1 discussions 4:15 Dismiss 3:5, 13 10:18 18:8, 20 19:4 23:7 25:1 26:21 dismissal 17:6 dispositive 10:6 12:24, 25 dispositive. 13:5 distinction 11:12 distinctions 27:4 distinguished 16:20 Dixie 1:15 do. 24:12 doing 9:25 25:11 don't 12:19 dovetail 27:6 dove-tie 5:9 Drive 2:4 27:17 < E > E 28:1 earlier, 3:10 Echevarria 14:2 EDWARDS 1:7 4:Z 13 5:5, 8, 11 18 6:1, 8 7:23 8:9, 20 9:25 18:17, 19, 23 19:15, 21, 22 20:3 21:16 25:13 Edwards' 18:23 EDWARDS. 2:10, 12 6:6 effect 26:23 effectively 4:5 eight 4:8 element 17:14 20:4 elements 12:7 25:24 else, 7:12 e-mail 19:7 e-mails 5:1, 4, 25 19:2, 4, 20 engage 9:11 entire 22:3 entirely 5:9 10:5 Epstein 3:4 6:17 7:2, 8, 9, 14, 16 8:15, 25 9:6 10:8 11:9 17:24 18:3, 6 19:8, 17, 25 EPSTEIN, 1:4 Epstein. 5:13 6:21 7:21 19:12 Epstein's 18:7 ESQUIRE 2:2, 2, 7 essentially 26:6 established 14:13 Even 11:15 events 5:7 evidence. 23:17 examples 17:18 excess 18:2 exchange 5:4, 25 explanation 5:9 extends 19:7 extensively 26:19 extent 4:23 extortion 10:7 extremely 4:20 <F> fabricate 10:7 face 16:23 17:2 18:9, 22 23:8 fact 7:7, 14 16:22 20:16 facts 16:7 24:22 facts. 20:22 23:15 factual 23:5 fall 23:11 falls 16:4, 17 23:11 federal 6:14 7:2, 12 8:3, 4 18:1, 14 fees 7:17 8:16 17:10 22:11 fees. 10:4 FIFTEENTH 1:1 filed 6:8, 15, 16, 18 7:3, 18 11:16, 18 15:4 17:23 18:1 filed. 15:5 filing 7:11 12:10 14:20, 24 18:7 26:5, 6 filing. 11:24 finding 23:5 finds 25:18 fine 3:19 finish. 20:24 firm 4:18 5:3 9:10, 11, 14 firm. 4:21 first 4:6 10:10 16:19 first. 3:13 five 4:6 FL 27:17 Flagler 2:4 Flea 10:11 FLORIDA 1:2, 16 2:4, 8 14:24 15:18 28:3 focus 4:23 following 10:22 26:22 for 14:3, 4 foregoing 28:7 form 9:16 forth 5:1 four 10:5 13:4, 15 17:14 Fourth 12:5 Fowler 2:3 FPR 1:17 28:5 frivolous 20:21 21:24 25:18 26:7 fund 9:18 funds 9:5, 12 further 24:8, 9, 10 furtherance 20:7 < G > generally 16:1 get 7:14 gist 21:10 give 12:22 13:6, 21 24:7 25:24 given 5:14 gives 20:1 go 8:10 24:10 going 4:18 5:10, 19, 25 8:2 13:1 23:18 24:7 going. 21:2 good 11:7 Gotcha 13:17 22:17 grievances 14:25 guess 3:5, 14 16:14 24:25 26:6, 12 guys 3:9 guys. 27:13 < H > hand 13:9 happy 13:23 26:24 have 8:14 15:4 23:3 25:2 have. 13:19 he 15:20 19:17, 25 HEARING 1:12 24:24 25:3 26:20 27:14 helpful 3:21 highlighted 14:7, 9 highly 18:4 Highway 1:15 him 5:9 Honor 3:21 10:12, 17 13:3, 9 14:7, 12 17:12 22:2 24:3 Honor, 26:18 Honor. 3:16 20:25 22:8 27:12 HONORABLE 1:12 <I> I 4:22 16:15 19:1 24:1/ 26:5 if 11:12 14:/7, 25 ignore 4:5 illegal 7:23 I'm 24:6 immaterial 4:16 immediate 10:24 Immunity 16:4 23:1 Important 4:20 Improper 9:16, 21 11:18 12:2, 12, 17 14:19, 20 17:17 Improper, 7:23 IN 1:1 4:4 7:20 13:12 17:21, 23 18:1 21:4 inappropriate 22:12 Incidental 11:3 Include 18:7 inconvenience 15:17 Incorporated 4:3 incorporates 10:18 incur 17:9 incurred 17:7 22:11 incurring 10:3 individually 1:8 individually, 1:7, 7 inferences 5:23 ORANGE REPORTING 800.275.7991 EFTA01081054 4 Information 19:13, 24 inherent 14:22 initial 11:13, 23 innocent 5:9 instances 18:13 instructions 24:7 intended 11:2 17:20 18:4 26:7 interdependence 5:15 interrupt 16:13 introduction 3:25 invest 18:6 19:8 investigate 9:13 investigation 9:6 Investigators 5:16 18:23 19:21 Investments 10:10, 22 12:25 investments. 6:3 investors 7:4, 25 18:6 19:6, 8, 19 investors. 20:1 involve 19:20, 20, 21 involved 6:2 8:17, 22 18:24 involved. 12:8 involvement 4:11 5:5, 18 involves 15:19 16:21 involving 18:10 is 3:25 4:15 5:21 6:24 16:4 18:9 22:24 26:6 is, 16:2 25:7 26:4 issue 11:14 15:15 26:11 27:8, 9 issued 18:10 issues 14:4, 5 20:15 26:8 issues. 12:12 it 23:10 26:11 it. 4:5 24:3 26:16, 25 its 14:22 17:14 18:9 it's 9:2 16:14 itself. 16:25 <J> JACK 2:7 JEFFREY 1:4 JOSEPH 2:2 JR 2:2 judge 16:5 JUDICIAL 1:1 17:16 jurisdictional 4:7 jury 16:6 23:18 25:17 just 27:6 justification 10:7 < K > KENT 1:17 28:5, 18 knew 5:18 KNIGHT 2:2 know 6:10 9:1, 9, 15 12:21 15:21 21:1 24:14 25:9, 10 knowing 16:18 knowledge 5:5 known 5:19 < L > L.M 1:8 Lakes 2:8 law 5:3 9:9, 10, 12 12:3, 6 14:5 15:7, 10 16:11, 15, 16 17:21 20:9 23:2, 3, 10 lawsuit 16:4 20:20 21:16 26:5, 6 lawsuit, 25:18 lawsuit. 21:13 lawsuits 20:21 21:5 lawyers, 5:15 lay 12:16 learned 6:7, 18 legal 10:18 17:17 Legend 27:17 legitimate 6:10, 12 10:1 11:16 12:4 level 4:17 level, 27:3 Levin-Middlebrook 13:16 liability 25:9 like 25:9 link 18:23 19:3, 23 21:17 links 20:2 list 18:12 litigants 15:1 litigation 4:4 10:15 13:24 14:2, 3, 12, 15 15:2, 14, 25 16:24 20:12 22:19 litigation, 14:18, 22 litigation. 12:18 17:10 LM 17:23 18:10, 10 log 19:13 look 8:8 26:14 looking 16:16 17:22 looks 19:2 22:19 23:23 lot 4:25 < M > maintaining 8:24 major 5:2 making 8:2 26:8 malicious 9:21 11:/7 25:15, 20 27:5 maliciousness 26:5 Market 10:11 materials 24:8 matter 14:/6 15:6, 10 16:11, 15 may 11:13 me, 26:12 mean 12:19, 20, 20 16:12 24:13 25:23 27:2 meetings 5:25 mere 12:9 million 18:2 minutes 24:3 misconduct 4:11 14:18 missed 22:5, 7 misuse 17:16 money 8:15 19:10 monitored 4:14 months 18:9 more 4:2 Motion 3:5, 6, 12 10:17, 19 15:4 23:23, 24 24:2, 11 25:1 26:16, 21 motion. 3:14 10:16 24:18 motions 3:8 14:20 18:7 motivation. 9:22 motive 9:16 11:3 motive. 9:3 motives 8:22, 22, 24 9:5, 20 11:7 18:16 motives. 8:20 moved 15:18 much. 3:20 must 10:23 12:11 my 28:8 < N > name 6:16, 17, 19, 24 names 13:6 nature 17:7, 9 necessarily 5:17 necessary 20:4 need 20:16 23:15 neighbor 15:16 never 6:17, 20, 25 8:4, 25 new 3:6 next-door 15:15 nine 4:8 18:8 no 7:19 North 1:15 not 3:23 12:4, 10 19:9 21:23 26:7 not. 22:25 Notary 1:17 notebook 10:12 notes. 28:9 nothing 5:24 notice 15:3 noticed 15:4 now 20:14 Now, 6:9 number 13:15, 16 numbered 4:6 <O> obliged 7:16 15:1 obtain 9:13 obtaining 9:5, 7, 12 Obviously 3:25 4:15 occur 7:9 14:14 occurred 15:20 18:8 occurred. 7:10 occurring 11:15 occurs 11:17 October 19:16 OF 2:3, 7 4:17 5:22 6:22 7:6, 7, 15 8:17 9:25 11:9, 14 14:24 15:6 ORANGE REPORTING EFTA01081055 5 16:21 17:2, 5, 17 18:18 19:16 25:16, 21 offices 4:14 Okay 3:3 10:14 12:15 16:10 21:12, 19 22:18 23:22 24:9, 21 25:13, 25 26:17 Okay. 12:14 13:14 14:10 17:/, 4 22:9, 17 24:5 27:11 on 6:7 19:4, 24 on. 5:20 Once 14:13 one, 11:7 ones 27:6 one's 11:7 only 24:2 operate 9:15 operate. 9:8 operating 9:7, 14 opportunity. 12:23 opposing 14:8 or 5:18 11:3 21:6 order 7:24 11:20 originally 26:12 other 19:21 others. 13:10 out. 17:18 outside 21:5, 15 < p > P.A. 2:3 PALM 1:2, 15, 16 2:4, 8, 8 27:17 28:3 paragraph 4:9, 13, 17, 24, 25 5:7, 14 6:7 7:21, 23 8:6, 19, 23 9:24, 25 12:16 17:23 18:16 19:1 paragraphs 4:6, 7, 9 6:4 parties. 10:21 party 20:11 pay 7:16 Payless 10:11 pending 5:2 15:16 17:24 people 5:18 19:22 permission 3:17 permit 23:3 permitted 21:16 23:2 person 20:10 perspective, 5:8 perverted 7:24 17:17 Phillips 2:3 Phipps 27:16, 16 PLACE 1:15 plaintiff 5:13 10:2, 23 12:11 Plaintiff, 1:5 2:6 plaintiff. 6:25 plaintiffs 9:9 25:11 pleading, 4:3 pleadings 16:17 pleadings. 23:8 please. 3:3 pleased 24:15 pled 20:14, 16 25:5 Point 2:3 3:6 14:11 point 23:13 policy. 14:16 Ponzl 4:12 5:6, 10, 11, 19 7:4 8:24 18:25 21:18 position 17:12 20:2 power 14:22 powers 14:23 practice 9:12 preceding 5:24 predicate 22:21 prefer 24:1, 4 PRESENT 2:12 press 4:3 preventing 25:12 privilege 14:2, 3, 5, 12, 13, 15 16:1,18, 19, 20, 21, 22 20:7 22:19 23:12 privilege. 13:25 privileged 19:13 problem 26:4 problems 27:3 proceeded 18:12 proceeding 22:24 proceedings 28:7 process 4:16 6:6, 23 7:24 8:10 10:24 11:1, 13, 15, 17, 20 12:3, 5, 7, 10, 11, 12 15:7, 10 16:3 17:18 18:10, 13 20:6 21:6 25:5, 17, 21, 22 27:5 process. 11:4 15:22 17:15 21:8 produce 7:13 products 25:8 profit 9:17 11:14 profits. 9:18 properly 20:16 proposition 14:4 propositions 10:23 prosecute 9:13 10:1 prosecution 4:19 5:2 7:18 8:13, 17 9:6 11:18 25:13, 16, 20 27:5 prospective 7:4 protected 20:6 prove 10:24 12:12 18:3 20:5 provided 3:9 10:12 14:7 provides 20:4 providing 14:8 19:23 Public 1:17 14:16 Punitive 3:6 10:20 24:2, 19 25:24 26:3, 16 purpose 10:25 11:4,14, 16, 19 12:2, 2, 4 19:9 25:12 purposes 4:4 9:12 17:20 26:7 pursue 10:9 put 27:1 pyramiding 5:22 < Q > Qualified 16:20, 20 question 22:7 23:10 question. 15:23 22:6 questions 16:21 24:16 quotes 10:23 < R > read 3:8, 8, 9 13:7, 17 21:20 24:3 26:9 reading 24:8 25:3 really 24:12, 24 25:14 26:12 reason 21:19 reason. 25:6 reasonable 5:23 received 19:14 reconsidering 26:24 record 27:16 28:8 recorded 4:15 recover 11:8 recovering 19:10 reference 8:6 regard 5:1 14:4 22:18 24:17 regardless 11:2 related 15:14 16:24 relating 4:18 relationship 22:23 release 4:3 relevance 9:2 relying 11:6 remedies 14:20 report 28:7 REPORTED 1:17 27:16 Reporter 1:17 28:6, 18 Reporting, 27:16 require 23:5 required 22:21 23:1 reschedule 26:15 reschedule, 26:10 reset 24:24 respond 15:1 21:6 rest 22:16 result 9:25 11:1 resulted 17:21 revenue 9:14 revenues 9:7 right 11:19 12:22 20:14 Right. 11:22, 25 rights 25:13 rise 25:24 RMR 1:17 28:5 ROTHSTEIN 1:7 3:4 4:11 6:5 18:5, 18 19:6, 6, 14, 18, 24 21:18 Rothstein, 18:24 Rothstein's 18:19 20:3 RPR 1:17 28:5 RRA 5:15 9:8 RRA's 4:14 ruled 25:1 ORANGE REPORTING EFTA01081056 6 ruling 26:8, 15 SI 10:10, 22 12:24 suggest 4:23 5:4 they 6:11 12:15 running 12:20 sides 24:12 13:4 25:6 17:19 Significantly 8:21 sui 26:24 things 10:1 21:4 <S> sir 12:13 13:19 suit 25:16, 17, 20, think 3:12, 2/ 4:5 S 2:1 3:1 14:1 15:9 21, 22 13:13 21:1 22:/, 5 satisfies 17:14 sir. 13:8 17:11 supported 20:21 24:11 25:2 saying 15:6, 9 21:3, 11 27:10 sure 13:19 25:16 third 10:6 13:13 16:10, 14 26:23 six, 4:7 27:7 this 25:10 says 4:25 5:14 slap-suit 25:9 system 14:25 17:17 this, 25:3 8:14 7:9 12:9 SCAROLA 2:7, 7 so 24:13 So, 15:14 system. 22:14 Those 20:13 22:19, 21 3:16, 20 10:17 sole 8:22 9:3, 20 < T > though. 13:22 11:20, 23 12:1, /3, 12:2 tab 10:11 13:15, 16 thought 12:25 24:9 15 13:3, 8, 12, 15, some 9:15 23:12 table 3:18 three 15:20 19,23 14:1, 11 somebody 6:15, 17, take 8:8 23:15, 17 through 14:23 15:9, 13, 24 16:9, 19 7:12 15:2 25:10 24:1, 3 26:14 tied 5:11 12, 19 17:2, 5 something 13:1 TAKEN 1:13 7:18 TIME 1:14 12:21, 18:20 19:4 20:15 sorry 16:12 8:12 20:5 22 17:25 23:23 22:5 23:22 24:1, 5, sorry. 16:11 talk 13:1 26:11 24:1, 11 15 26:2, 18 27:10 South 2:4 talking 8:5 times. 13:18 Scarola. 3:15 speaking 16:1 talks 4:17 to 3:12 5:1 7:3, 22, Scarola's 23:6 special 20:9, 13 tell 24:6 26:18 24, 25 8:2, 10, 16 scheme 5:10, 12, 19 specific 16:7, 7 ten 4:8 8:11 9:12, 17 10:6, 17 7:4 8:25 20:3, 8 scheme. 4:12 5:6 21:15 specifically 20:14 terms 6:2 test 15:14 14:5 15:16 16:5, 12 21:24 23:18 18:25 21:18 spend 8:15 24:10 testified 19:22 today. 10:9 24:4 scope 12:7 14:14 spite 11:3 Thank 3:16, 20 tort 17:15 25:25 SCOTT 1:7 4:11 sponte 26:24 27:12, 13 tort, 26:2 Searcy 2:7 staff 5:16 that 4:9 8:8, 9 9:7 transcript 28:8 seat 3:3 second 3:5, 22 stage 23:12, 14 stands 10:22 14:3 12:1 14:20 20:3, 7, 11 23:5, 6 25:14 trial 27:3 true 7:22 25:15 17:13 started 12:21 28:8 28:8 secondly 16:23 see 10:14 17:2 state 6:8 7:1, 17, 19 8:5, 7, 12, 14, 18 that, 22:1 26:22 that. 13:23 23:16 try 10:6 two 9:4 11:7 18:22 19:3, 14 17:24 18:14 28:3 THE 1:1 3:8 4:1, 8 13:12 15:19 24:3 22:20 state, 19:10 5:14, 17 6:20 8:6 26:15 see, 5:10 Statute 14:24 9:11 10:11, 12 seeking 6:9 18:1 sell 6:2 stenographic 28:9 stenographically 11:11, 16 12:2, 6, 17 14:14 15:13, 17 < U > ulterior 8:20, 22, 24 separate 15:1 28:7 16:3, 16, 17, 23 11:4 17:20 18:12 20:12 stuff. 26:9 17:14, 20 19:7 ultimately 18:24 September 1:13 subjective 7:7 20:19 21:12, 14 23:9 6:8 28:10 serial 11:9 submitted 3:10 subparagraphs 8:11 22:5, 10, 18 23:2, 11, 14 24:17 25:1 uncontested 4:10 underlying 21:13 series 19:19 subpoena 15:15 26:19, 20 27:2, 8, 15 26:2 serious 25:4 subsequent 11:15 them 18:13 understand 11:12 served 6:20, 25 12:3 them, 13:6 20:18 23:16 24:12, 7:19 8:5 12:10 subsequently 19:8 them. 3:11 13:7 13 25:7 26:22 27:2 set 17:18 20:1 21:25 understand. 22:15 seven 4:8 substance 4:24 themself 20:11 understanding 7:7 Shipley 2:7 substantial 4:10 theory 25:7 unfounded 8:2 short 12:21 25:3 substantive 4:22 there 13:3 unity 4:5 show 7:4, 12 12:11 suffered 5:13 10:2 there, 21:22 unnecessary 8:1 17:22 19:23 sufficient 23:4, 6 There's 6:10 10:3 these 8:21 ORANGE REPORTING EFTA01081057 unnumbered 4:1 unreasonable 8:1 unrelated 18:21 upon. 11:6 use 7:24 12:3, 12 17:17 22:14 uses 12:17 < V > valid 25:12, 19 variety 5:7, 22 various 4:15 versus 3:4 10:10 vetted 26:12 27:7 victim 9:1 vs. 1:6 <W> want 11:8, 8 13:7 15:16 24:8, 10, 14, 20, 23 27:7 wants 18:20 19:4 was 4:13 6:19 18:2, 3 way 4:9 way. 27:1 we 6:5 18:16 Wednesday 1:13 weeks 15:19 well 3:6 5:21 11:11 12:9 27:1 Well, 7:4 well. 13:13 14:9 17:8 well-founded 6:12 went 3:22 5:1 were 9:19 12:25 21:5 We're 3:4 5:10 6:5 8:2 West 1:16 2:3, 4, 8 27:17 We've 19:1, 7, 9, 14 20:5, 9 what 19:3 21:15 where 12:3 White 2:3 wide 5:16 win 25:17 with 14:1, 2, 8 19:5 within 4:20 wonderful 25:15 would 15:21 23:4 wrong 11:13 wrongdoing 9:23 < Y > Yeah 13:24 years 15:20 Yes. 15:24 you 15:2 you. 22:13 you-all 26:15 young 11:10 Your 14:11 22:7 you're 14:19 ORANGE REPORTING EFTA01081058