SUPPL E MENT AL NOTI CE RE GARDI NG CROSS MOTI ONS T O DISMISS
Defendant Dana Eiser respectfully submits this supplement to her previous 12(b)(1) motion to dismiss (Dkt. #60) and her response (Dkt. #62) to Plaintiffs 12(b)(6) motion to dismiss certain counterclaims. The supplemental material below relates to a sanctions hearing that occurred yesterday in Nevada and to a public statement also made yesterday by a Righthaven associate that confirms many of Defendants claims. This material is of extreme importance to several arguments made by Defendant in the previously-referenced filings. Defendant respectfully requests that the Court refrain from ruling on either Defendants 12(b)(1) motion or Plaintiffs 12(b)(6) motion until a transcript of the Nevada is available and submitted to this Court, and Defendant also requests the Court consider the statement made by the Righthaven associate when making such a ruling. July 14, 2011 Sanctions Hearing in Righthaven v. Democratic Underground In June of 2011, Judge Hunt of the District of Nevada indicated his belief that Righthaven had made intentional misrepresentations to the federal courts in all Righthaven cases. This statement was made in the context of issuing an order to show cause to Righthaven threatening sanctions for the conduct. That order to show cause was part of the order dismissing
2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64 Page 1 of 6 Page 2 of 6 Righthavens complaint in Righthaven v. Democratic Underground, already before this Court as Dkt. #60-3. 1
Yesterday, July 14, 2011, Judge Hunt conducted a hearing on the order to show cause. Judge Hunt sanctioned Righthaven and made findings that are highly relevant to this case, especially to the cross motions to dismiss now pending before the Court. 2 Judge Hunt found: 1. That Righthaven is an unlicensed law firm with a contingent fee agreement masquerading as a company. 3
2. That Righthaven made intentional misrepresentations to the federal courts as to the nature of its client relationship and the rights it held under the copyright assignments. 4
3. That Righthaven claimed that it had various exclusive rights when it knew that the ability to exercise those rights were retained exclusively by [its client]. 5
4. That The representations about the [Righthaven-client] relationship and the rights of Righthaven were misrepresentations. They were misleading. 5. That Righthavens failure to disclose the true nature of its client relationship was not negligence.
1 The full citation is: Order dated 6-14-2011, Dkt. #116, Righthaven v. Democratic Underground, 2:10-cv-01356-RLH-GWF, ___ F.Supp.2d ___, 2011 WL 2378186 (D. Nev. June 14, 2011) (HUNT, J.). 2 These findings were widely reported in media following the Righthaven cases. 3 Media covering the matter reported that when Judge Hunt began to issue his ruling, he stated: Inthecourtsview,thearrangementbetweenRighthavenandStephensMediaisnothingmore, nor less, than a law firmwhich incidentally I dont think is licensed to practice law in this statewith a contingent fee agreement masquerading as a company. Righthaven is not a law firm and does not claim to be a law firm. 4 Media reports also indicated that after discussing Righthavens misrepresentations regarding its client relationships, Judge Hunt stated: The court finds those representations are not true and that they are intentional. 5 This statement and subsequent statements are as reported by other attorneys present in the Nevada courtroom. 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64 Page 2 of 6 Page 3 of 6 6. That Righthavens intentional failure to disclose the true nature of its client relationship was part of a concerted effort to hide [the clients] role in this litigation. 7. That having looked at all this evidence, [the Court] finds that [Righthavens statements] are intentionally untrue. Judge Hunt issued a monetary sanction against Righthaven and further ordered Righthaven to provide certain materials to every court currently handling a Righthaven case. Specifically, Righthaven has been ordered to provide all courts with: (1) the order to show cause; (2) a complete copy of the transcript of the July 14, 2011, hearing; and (3) any written order subsequently issued by Judge Hunt connected with these matters. These findings are not only extremely important to this case, they may have an issue- preclusive effect that would prohibit Righthaven from even arguing to the contrary in this court or any other. These findings are extremely relevant to many arguments raised by Defendant in the 12(b)(1) motion to dismiss. In addition, it is impossible to overstate the relevance of these findings to Defendants abuse of process and unfair trade practices claims. Statement Made by Former Stephens Media C E O Sherman Frederick Purely by coincidence, just hours before the hearing described above, former Stephens Media CEO Sherman Frederick made a public statement that is also extremely relevant to the foregoing matters. A bit more background information is necessary to paint the full picture of the Frederick statement. Many Righthaven targets are political speakers. In addition to the Democratic Underground website, Righthaven has sued a variety of political organizations. A disproportionate number of the earlier suits were against organizations in Nevada, which makes sense given Righthavens home base is Las Vegas and the early lawsuits are all based on 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64 Page 3 of 6 Page 4 of 6 material appearing in the Las Vegas Review-Journal. Accordingly, in 2010, Righthaven sued the Progressive Leadership Alliance of Nevada, 6 the Democratic Party of Nevada, 7 and the Republican U.S. Senate nominee from Nevada, Sharron Angle. 8
All of these Righthaven cases were filed while Sherman Frederick was still CEO of Stephens Media. The suits were over material appearing in the Las Vegas Review-Journal, a newspaper owned by Stephens Media. As with each Righthaven case, Stephens Media was not a plaintiffRighthaven was the sole plaintiff. About a month after the Angle suit was filed, Sherman Frederick vacated the position as CEO of Stephens Media and became an opinion columnist and blogger with the Las Vegas Review-Journal, a position he still occupies. Fredericks columns and blog posts sometimes involve political topics. In addition to writing the columns and blog posts, Frederick will sometimes engage in back-and-forth discussions with people who post comments on the blog. Unlike other commenters, Fredericks comments are highlighted on his blog with a yellow background and are designated as being written by Sherm. Yesterday, Frederick authored a blog post about Sharron Angle and media reaction to her unsuccessful Senate campaign. This post is attached as Exhibit 1. 9 The Angle posting elicited comments, and Frederick responded to several of the comments. In one of those responses, Frederick referenced the Righthaven lawsuit against Sharron Angle:
6 Righthaven v. Progressive Leadership Alliance of Nevada, 2:10-cv-00637-RLH-RJJ (D. Nev.) (filed May 4, 2010). 7 Righthaven v. Democratic Party of Nevada, 2:10-cv-01129-KJD-PAL (D. Nev.) (filed July 9, 2010). 8 Righthaven v. Angle, 2:10-cv-01511-RLH-RJJ (D. Nev.) (filed September 3, 2010). 9 The yellow highlighting is imperceptible on Exhibit 1 for technical reasons, though it appears clearly on the Internet and in the excerpt on the next page. The post is presently available at http://www.lvrj.com/blogs/sherm/Angle_haters_No_proof_no_reporting.html. 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64 Page 4 of 6 Page 5 of 6
Fredericks remark, I even sued her for lifting our material, is a statement that is of substantial relevance to Defendants claims that the Righthaven-client relationship is a sham. It constitutes a public admission by Stephens Medias then-CEO that heand by extension, Stephens Mediawas truly in control of the Righthaven litigation. It is ironic that several hours before Judge Hunts sanctions hearing, Sherman Frederick made a public statement confirming everything that Judge Hunt would find later that same day. Conclusion Defendant respectfully requests that the Court withhold ruling on the cross motions to dismiss until Righthaven has provided this Court with the transcript of the July 14, 2011 sanctions hearing in Democratic Underground and any written order in connection with that hearing, as Judge Hunt mandated Righthaven do so that other courts would have the benefit of knowing the truth behind the Righthaven scheme. Defendant will actively monitor the situation and provide the material as soon as it becomes available should Righthaven fail to. Further, Defendant respectfully requests that any ruling on the cross motions to dismiss take into consideration the statement by Sherman Frederick described herein and contained in Exhibit 1. 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64 Page 5 of 6 Page 6 of 6 Undersigned counsel by no means wish to irritate the Court with continued supplemental submissions. None of the material described in this supplement existed prior to yesterday, so there was no way for defense counsel to present it in any prior filings. Respectfully submitted,
s/J. Todd Kincannon s/Bill Connor J. TODD KINCANNON, ID #10057 BILL CONNOR, ID #9783 THE KINCANNON FIRM HORGER AND CONNOR LLC 1329 Richland Street 160 Centre Street Columbia, South Carolina 29201 Orangeburg, South Carolina 29115 Office: 877.992.6878 Office: 803.531.1700 Fax: 888.704.2010 Fax: 803.531.0160 Email: Todd@TheKincannonFirm.com Email: bconnor@horgerlaw.com
s/Thad T. Viers THAD T. VIERS, ID #10509 COASTAL LAW LLC 1104 Oak Street Myrtle Beach, South Carolina 29578 Office: 843.488.5000 Fax: 843.488.3701 Email: tviers@coastal-law.com
July 15, 2011 Attorneys for Defendant 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64 Page 6 of 6
Exhibit 1 to DefendantEisers Supplement re Sanctions Hearing and Sherman Fredericks Statement
Sherman Fredericks Blog Post re Sharron Angle 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64-1 Page 1 of 4
Sherman Frederick is a columnist for Stephens Media. His column appears Sunday in the Opinion section of the Review-Journal. In between Sundays, you can find out what's on his mind here.
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Angle haters: No proof, no reporting Posted by Sherman Frederick Thursday, Jul. 14, 2011 at 09:37 AM Let's get honest, shall we? A fair chunk of the Nevada media exhibits a remarkable disdain for Sharron Angle. You simply can't thumb through the record of stories, editorials and Twitter notes without coming to that conclusion. This is not about whether you like Angle's politics or not. This is about how this one figure manages to bring out the worst in the state's media. Take a look, for example, at the tweets sent yesterday by the media against Angle. It's hard not to look at them and conclude anything other than these folks have something personal against Angle. One guy even said that no one should report Angle's charges that Sen. Harry Reid stole the 2010 election unless Angle shows proof. Proof? That's an interesting standard, which is apparently only reserved for Angle. Nevada contains all kinds of newsmakers who say things every day without proof. The media covers those guys like a cat laps up milk. But if a newsmaker says something the media doesn't like, well, then no one should report it unless the newsmaker can prove it. That's an unsustainable standard reserved only for Sharron Angle. This entry was posted on Thursday, Jul. 14, 2011 at 09:37 AM and is filed under The Complete Las Vegan. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response. Comments (12) Share your thoughts on this story. You are not currently logged in. You must be registered to comment.Register | Sign in | Terms and Conditions
Submit Some comments may not display immediately due to an automatic filter. These comments will be reviewed within 24 hours. Please do not submit a comment more than once. Note: Comments made by reporters and editors of the Las Vegas Review-Journal are presented with a yellow background. 12 Responses to "Angle haters: No proof, no reporting" Sherm, I agree--when a Senate candidate, even one as dismal as Angle was, from a major party, even as insane as the GOP has been and continues to be, makes that kind of charge, there should be some reporting. In fact, if you 3 Like 2
Share HOME NEWS SPORTS BUSINESS LIFESTYLES ENTERTAINMENT TRAVEL OPINION OBITUARIES DEALS CLASSIFIEDS HOMES AUTOS JOBS Page 1 of 3 Angle haters: No proof, no reporting - The Complete Las Vegan - ReviewJournal.com 7/14/2011 http://www.lvrj.com/blogs/sherm/Angle_haters_No_proof_no_reporting.html 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64-1 Page 2 of 4
had held to even that minimal a standard during the 2010 campaign, your paper might have covered Harry Reid fairly, and you and Mitch might still be in charge. Written by: Michael Green on Thursday, Jul. 14, 2011 at 10:33 AM -- Report abuse today's fun fact: the U.S. government's share of home mortgages declined sharply during the housing bubble of the last decade. Written by: petenyc on Thursday, Jul. 14, 2011 at 10:53 AM -- Report abuse Aside from your fantasy about my particular bit of 2010 history, Michael, your comment remains unresponsive to the point at hand (no surprise) as well as degrading and ignorant to the reporters at the Review-Journal who are there now and who were there in 2010. Written by: Sherm on Thursday, Jul. 14, 2011 at 11:23 AM -- Report abuse Talk about your losers. Sherman's pathological affinity for Angle borders on hysteria..Angle is an embarrassment to Nevada. Naturally, her inane mouthings are music to the ears of the tone deaf Sherman and his beloved tea party. Harry didn't steal the election, Angle handed it to him every time she opened her mouth. With Harry's abysmal approval ratings, only a dolt like Angle could have ceded the election to the intensely disliked Reid. Sherman you still are a redundant bore. The election is over. So is the tea party. Do you actually get paid to be this irrelevant ? Written by: Craig.Taylor on Thursday, Jul. 14, 2011 at 11:40 AM -- Report abuse So, is Mr. Frederick asserting that Ms. Angle should be allowed to question the results of a federal election -- i.e. undermining the entirety of our democracy -- without a shred of proof?
Of course, his characterizations of the rest of the Nevada press is ridiculous when you remember that Mr. Frederick has not once, in all the time I've read his work, challenged Republican lawmakers or their statements. On the contrary, he routinely takes them at face value.
Apparently, you can only be a partisan journalist if you're partisan in favor of the Democrats.
I thought Mr. Frederick -- who was removed, we must remember, for his shameless campaigning against Harry Reid, which brought embarrassment to the Review-Journal as a publication -- had already reached his lowest point.
But today, it seems, is the day he jumped the shark. Amazing stuff. Written by: Captain Obvious on Thursday, Jul. 14, 2011 at 11:41 AM -- Report abuse Sherm, unlike your BLOG, a newspaper has SOME responsibility to report the truth. Angle saying Reid STOLE the election from her without offering anything other than her sour grapes can lead to a libel suit and most papers don't want to even be involved. Since this is a BLOG you can say whatever you want and not back anything up... Feel free to assist Angle in making up reasons that she lost other than the fact she had to go so far to the right to win the nomination that she locked herself out of the moderate vote. But if she were such a strong viable candidate, why was she shut out of the most recent nomination?? The answer is she is too far to the right for even Republicans to take her seriously. Written by: Justin.in.NLV on Thursday, Jul. 14, 2011 at 11:47 AM -- Report abuse Believe me, the debt ceiling crisis is far more important to me than the proper standards of reporting scurrilous and unsubstantiated made by Sharron Angle. Nevertheless, I would think the most comment-worthy aspect of Angle's accusation would be whether or not it is accurate. Funny that Mr. Frederick doesn't seem to care about that. Written by: petenyc on Thursday, Jul. 14, 2011 at 12:05 PM -- Report abuse You mean the debt ceiling Obama voted against raising when he was a Senator? Hummmm? Written by: Sherm on Thursday, Jul. 14, 2011 at 12:36 PM -- Report abuse Yes, he certainly should not have voted against it. Quite an error. He should have realized that not raising the debt ceiling when it comes due would be genuinely catastrophic to our country - as Martin Wolf noted in the FT yesterday, it would be one of the gravest self-inflicted economic wounds of all time. Page 2 of 3 Angle haters: No proof, no reporting - The Complete Las Vegan - ReviewJournal.com 7/14/2011 http://www.lvrj.com/blogs/sherm/Angle_haters_No_proof_no_reporting.html 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64-1 Page 3 of 4 Contact the R-J Subscribe Report a delivery problem Put the paper on hold Advertise with us Report a news tip/press release Send a letter to the editor Print announcement forms Jobs at the R-J Stephens Media, LLC Privacy Statement RSS Twitter Facebook How to link to the RJ
Copyright Stephens Media LLC 1997 - 2011 Feedback Written by: petenyc on Thursday, Jul. 14, 2011 at 12:57 PM -- Report abuse Sherm, if you read my post thoroughly, you would note I said that "even" Angle's charges should be covered. As for my "fantasy," you and Mitch keep going--the reality-based community knows much, much better. I also should note that Obama has said he was wrong to vote as he did on the debt ceiling. Gee, admitting error. If you did that, you'd have nothing else to talk about, eh? Written by: Michael Green on Thursday, Jul. 14, 2011 at 1:16 PM -- Report abuse What you said was the RJ didn't do any reporting on the race. That is completely incorrect. I even sued her for lifting our material. Written by: Sherm on Thursday, Jul. 14, 2011 at 1:30 PM -- Report abuse Sherm,
Here are a couple of links for your consideration:
More voters would blame Republicans than Obama in absence of debt limit deal, says poll:
During Bush Presidency, Current GOP Leaders Voted 19 Times To Increase Debt Limit By $4 Trillion:
http://thinkprogress.org/politics/2011/04/14/158424/republican-leaders-debt -limit-hypocrisy/ Written by: Diogenes of Sinope on Thursday, Jul. 14, 2011 at 1:45 PM -- Report abuse Page 3 of 3 Angle haters: No proof, no reporting - The Complete Las Vegan - ReviewJournal.com 7/14/2011 http://www.lvrj.com/blogs/sherm/Angle_haters_No_proof_no_reporting.html 2:10-cv-03075-RMG -JDA Date Filed 07/15/11 Entry Number 64-1 Page 4 of 4