Steven Gregory Sloat, Ed Bryan, Church of Scientology International, David J. Lubow, and Monty Drake v. Monique Rathbun

ACCEPTED 03-14-00199-CV 4055345 THIRD COURT OF APPEALS AUSTIN, TEXAS 2/6/2015 1:53:57 PM JEFFREY D. KYLE CLERK No. 03-14-00199-CV ______________________________________ COURT OF APPEALS FILED IN 3rd COURT OF APPEALS THIRD JUDICIAL DISTRICT OF TEXAS AUSTIN, TEXAS AUSTIN, TEXAS 2/6/2015 1:53:57 PM ______________________________________ JEFFREY D. KYLE Clerk CHURCH OF SCIENTOLOGY INTERNATIONAL, et al. Appellants, v. MONIQUE RATHBUN, Appellee. ______________________________________ MOTION FOR LEAVE TO FILE REPLY RE: NOTICE OF SUPPLEMENTAL AUTHORITY OF APPELLANT CHURCH OF SCIENTOLOGY INTERNATIONAL ______________________________________ On Appeal from the 207th Judicial District Court of Comal County, Texas Trial Court No. C-2013-1082B Hon. Dib Waldrip of the 433rd Judicial District Court, Presiding ______________________________________

Of Counsel: Thomas S. Leatherbury State Bar No. 12095275 Eric M. Lieberman Marc A. Fuller RABINOWITZ, BOUDIN, STANDARD, State Bar No. 24032210 KRINSKY & LIEBERMAN PC VINSON & ELKINS LLP 45 Broadway, Suite 1700 Trammell Crow Center New York, New York 10006 2001 Ross Avenue, Suite 3700 Telephone: 212.254.1111 Dallas, Texas 75201 Facsimile: 212.674.4614 Telephone: 214.220.7792 elieberman@rbskl.com Facsimile: 214.999.7792 tleatherbury@velaw.com mfuller@velaw.com

Ricardo G. Cedillo George H. Spencer, Jr. State Bar No. 04043600 State Bar No. 18921001 Isaac J. Huron CLEMENS & SPENCER State Bar No. 24032447 112 E. Pecan Street, Suite 1300 Les J. Strieber III San Antonio, Texas 78205-1531 State Bar No. 19398000 Telephone: 210.227.7121 DAVIS, CEDILLO & MENDOZA, INC. Facsimile: 210.227.0732 McCombs Plaza, Suite 500 spencer@clemens-spencer.com 755 E. Mulberry Avenue San Antonio, Texas 78212 Telephone: 210.822.6666 Facsimile: 210.822.1151 rcedillo@lawdcm.com ihuron@lawdcm.com lstreiber@lawdcm.com

Attorneys for Appellant Church of Scientology International TO THE HONORABLE COURT OF APPEALS:

Appellant Church of Scientology International (“Church”) requests leave to file a short notice that provides subsequent history in Woodward v. Church of Scientology Int’l et al., Case No. BC540097 in the Superior Court for the State of California for the County of Los Angeles. In light of Woodward’s relevance to the Court’s questions during oral argument regarding how Texas’s anti-SLAPP statute should be applied in mixed-claims cases, where some claims arise from activities protected by the statute and some claims allegedly do not, the Church brought Woodward to the Court’s attention in a previously-filed Notice of Supplemental Authority, which the Court granted leave to file on December 3, 2014.

In response to the Church’s Notice, Appellee Monique Rathbun argued that Woodward was “not helpful” to the Court’s analysis in this case, in part because there was a pending motion for reconsideration. See Jan. 6, 2015 Response. The Church now seeks leave to submit notice of the Woodward court’s order denying the motion for reconsideration. See Ex. 1.

Wherefore, the Church prays that this Court grant this Motion for Leave to File Reply re: Notice of Supplemental Authority of Appellant Church of Scientology, which is attached hereto as Exhibit 1, and grant any such other relief to which it may be justly entitled.

-1-Respectfully submitted,

/s/ Thomas S. Leatherbury Thomas S. Leatherbury State Bar No. 12095275 Marc A. Fuller State Bar No. 24032210 VINSON & ELKINS L.L.P. 2001 Ross Avenue, Suite 3700 Dallas, Texas 75201-2975 Telephone: 214.220.7792 Facsimile: 214.999.7792 tleatherbury@velaw.com mfuller@velaw.com

Ricardo G. Cedillo State Bar No. 04043600 Isaac J. Huron State Bar No. 24032447 Les J. Strieber III State Bar No. 19398000 DAVIS, CEDILLO & MENDOZA, INC. McCombs Plaza, Suite 500 755 E. Mulberry Avenue San Antonio, Texas 78212 Telephone: 210.822.6666 Facsimile: 210.822.1151 rcedillo@lawdcm.com ihuron@lawdcm.com

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George H. Spencer, Jr. State Bar No. 18921001 CLEMENS & SPENCER 112 E. Pecan Street, Suite 1300 San Antonio, Texas 78205-1531 Telephone: 210.227.7121 Facsimile: 210.227.0732 spencer@clemens-spencer.com

Of Counsel:

Eric M. Lieberman RABINOWITZ, BOUDIN, STANDARD, KRINSKY & LIEBERMAN PC 45 Broadway, Suite 1700 New York, NY 10006 Telephone: 212.254.1111 Facsimile: 212.674.4614 elieberman@rbskl.com

Attorneys for Appellant Church of Scientology International

CERTIFICATE OF CONFERENCE

On February 6, 2015, I conferred with Appellee’s counsel, Leslie Hyman, who stated that Appellee is not opposed to this motion.

/s/ Marc A. Fuller____________ Marc A. Fuller

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CERTIFICATE OF SERVICE The undersigned certifies that on the 6th day of February, 2015, the foregoing Motion for Leave to File Reply re: Notice of Supplemental Authority for Appellant Church of Scientology International was served on the following attorneys in accordance with the requirements of the Texas Rules of Appellate Procedure via electronic filing or email.

Ray B. Jeffrey Marc F. Wiegand JEFFREY & MITCHELL, P. C. THE WIEGAND LAW FIRM, P.C. 2631 Bulverde Road, Suite 105 434 N. Loop 1604 West, Bulverde, TX 78163 Suite 2201 San Antonio, TX 78232

Elliott S. Cappuccio Lamont A. Jefferson PULMAN, CAPPUCCIO PULLEN HAYNES & BOONE LLP & BENSON, LLP 112 E. Pecan Street, Suite 1200 2161 N.W. Military Hwy., #400 San Antonio, TX 78205-1540 San Antonio, TX 78213

J. Iris Gibson Jonathan H. Hull HAYNES & BOONE LLP REAGAN BURRUS 600 Congress Ave., Suite 1300 401 Main Plaza, Suite 200 Austin, TX 78701 New Braunfels, TX 78130

O. Paul Dunagan Bert H. Deixler SARLES & OUIMET KENDALL BRILL KLIEGER 370 Founders Square 10100 Santa Monica Blvd., 900 Jackson Street Suite 1725 Dallas, TX 75202 Los Angeles, CA 90067

Stephanie S. Bascon Wallace B. Jefferson LAW OFFICE OF STEPHANIE S. BASCON, Rachel Ekery PLLC ALEXANDER DUBOSE JEFFERSON 297 W. San Antonio Street & TOWNSEND, LLP New Braunfels, TX 78130 515 Congress Avenue, Suite 2350 Austin, TX 78701

/s/ Thomas S. Leatherbury Thomas S. Leatherbury

-4- US 3272943v.1

EXHIBIT 1

No. 03-14-00199-CV ______________________________________

COURT OF APPEALS THIRD JUDICIAL DISTRICT OF TEXAS AUSTIN, TEXAS ______________________________________ CHURCH OF SCIENTOLOGY INTERNATIONAL, et al. Appellants, v. MONIQUE RATHBUN, Appellee. ______________________________________ REPLY RE: NOTICE OF SUPPLEMENTAL AUTHORITY OF APPELLANT CHURCH OF SCIENTOLOGY INTERNATIONAL ______________________________________ On Appeal from the 207th Judicial District Court of Comal County, Texas Trial Court No. C-2013-1082B Hon. Dib Waldrip of the 433rd Judicial District Court, Presiding ______________________________________

Of Counsel: Thomas S. Leatherbury State Bar No. 12095275 Eric M. Lieberman Marc A. Fuller RABINOWITZ, BOUDIN, STANDARD, State Bar No. 24032210 KRINSKY & LIEBERMAN PC VINSON & ELKINS LLP 45 Broadway, Suite 1700 Trammell Crow Center New York, New York 10006 2001 Ross Avenue, Suite 3700 Telephone: 212.254.1111 Dallas, Texas 75201 Facsimile: 212.674.4614 Telephone: 214.220.7792 elieberman@rbskl.com Facsimile: 214.999.7792 tleatherbury@velaw.com mfuller@velaw.com

Ricardo G. Cedillo George H. Spencer, Jr. State Bar No. 04043600 State Bar No. 18921001 Isaac J. Huron CLEMENS & SPENCER State Bar No. 24032447 112 E. Pecan Street, Suite 1300 Les J. Strieber III San Antonio, Texas 78205-1531 State Bar No. 19398000 Telephone: 210.227.7121 DAVIS, CEDILLO & MENDOZA, INC. Facsimile: 210.227.0732 McCombs Plaza, Suite 500 spencer@clemens-spencer.com 755 E. Mulberry Avenue San Antonio, Texas 78212 Telephone: 210.822.6666 Facsimile: 210.822.1151 rcedillo@lawdcm.com ihuron@lawdcm.com lstreiber@lawdcm.com

Attorneys for Appellant Church of Scientology International

On December 3, 2014, the Court granted Appellant Church of Scientology International’s Motion for Leave to File Notice of Supplemental Authority regarding a California trial court’s ruling in Woodward v. Church of Scientology Int’l et al., Case No. BC540097 in the Superior Court for the State of California for the County of Los Angeles. As the Church noted, the Woodward ruling is relevant to the Court’s questions during oral argument regarding how Texas’s anti-SLAPP statute should be applied in cases involving mixed claims, where some claims arise from activities protected by the statute and some claims allegedly do not. See Dec. 3, 2014 Notice of Supplemental Authority.

In response to the Church’s Notice, Appellee Monique Rathbun argued that Woodward is “not helpful” to the Court’s analysis of the mixed-claims issue because “the trial court’s order . . . [wa]s the subject of a motion to reconsider . . . .” See Jan. 6, 2015 Response at Ex. 1, p. 2.

The Woodward court has now denied the motion for reconsideration cited by Appellee. A copy of the court’s tentative ruling denying the motion for reconsideration is attached to this Reply as Ex. A, and a copy of the transcript of the January 7, 2015, hearing during which the court adopted the tentative ruling is attached to this Reply as Ex. B. The court’s order is now final.

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Respectfully submitted,

Ricardo G. Cedillo /s/ Thomas S. Leatherbury State Bar No. 04043600 Thomas S. Leatherbury Isaac J. Huron State Bar No. 12095275 State Bar No. 24032447 Marc A. Fuller Les J. Strieber III State Bar No. 24032210 State Bar No. 19398000 Vinson & Elkins L.L.P. Davis, Cedillo & Mendoza, Inc. 2001 Ross Avenue, Suite 3700 McCombs Plaza, Suite 500 Dallas, Texas 75201-2975 755 E. Mulberry Avenue Telephone: 214.220.7792 San Antonio, Texas 78212 Facsimile: 214.999.7792 Telephone: 210.822.6666 tleatherbury@velaw.com Facsimile: 210.822.1151 mfuller@velaw.com rcedillo@lawdcm.com ihuron@lawdcm.com George H. Spencer, Jr. State Bar No. 18921001 Clemens & Spencer 112 E. Pecan Street, Suite 1300 San Antonio, Texas 78205-1531 Telephone: 210.227.7121 Facsimile: 210.227.0732 spencer@clemens-spencer.com

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Of Counsel:

Eric M. Lieberman Rabinowitz, Boudin, Standard, Krinsky & Lieberman PC 45 Broadway, Suite 1700 New York, New York 10006 Telephone: 212.254.1111 Facsimile: 212.674.4614 elieberman@rbskl.com

Attorneys for Appellant Church of Scientology International

-3- US 3271742v.1

EXHIBIT A

1/6/2015 www.lacourt.org/tentativeRulingNet/ui/ResultPopup.aspx

DEPARTMENT 56 LAW AND MOTION RULINGS

DEPARTMENT 56, JUDGE MICHAEL JOHNSON LAW AND MOTION RULINGS

The Court makes every effort to post tentative rulings by 2.00 pm of the court day before the hearing. The tentative ruling will not become the final ruling until the hearing [see CRC 3.1308(a)(2)].

If the parties wish to submit on the tentative ruling and avoid a court appearance, all counsel must agree and choose which counsel will give notice. That counsel must 1) call Dept 56 by 8:30 a.m. on the day of the hearing (213/663-0656) and state that all parties will submit on the tentative ruling, and 2) serve notice of the ruling on all parties. If any party declines to submit on the tentative ruling, then no telephone call is necessary and all parties should appear at the hearing in person or by Court Call.

Court reporters are not provided for any of the court’s morning sessions. Parties who want a record of motions and other morning proceedings must hire a privately retained certified court reporter.

Case Number: BC540097 Hearing Date: January 07, 2015 Dept: 56

Case Name: Woodward v. Church of Scientology International, et al. Case No.: BC540097 Matters: (1) Plaintiff’s Motion for Reconsideration and for Leave to File Amended Complaint; (2) Defendants’ Motion for Attorney Fees and Costs

Tentative Ruling: (1) Motion for reconsideration/leave is denied; (2) Motion for fees and costs is granted.

Plaintiff Vance Woodward filed this action against Defendants Church of Scientology International, Church of Scientology of San Francisco and related entities. On 10/8/14 the court granted Defendants’ anti-SLAPP motion. Plaintiff now moves to reconsider the court’s 10/8/14 ruling and for leave to file an amended complaint. Defendants move for recovery of their attorney fees and costs pursuant to CCP §425.16(c)(1).

Motion for Reconsideration/Leave – Plaintiff moves to reconsider the court’s 10/8/14 ruling. A motion for reconsideration may only be brought if the party moving for reconsideration can offer “new or different facts, circumstances, or law” which could not have been produced with reasonable diligence at the time of the prior motion. See CCP §1008(a); Forrest v. Dept. of Corp. (2007) 150 Cal.App.4th 183, 202.

Plaintiff has not met this standard. Plaintiff’s arguments only constitute further elaboration on the matters presented in his opposition to the motion, and Plaintiff appears to have been aware of them at the time of the hearing. Plaintiff claims that he was misled by Defendants’ arbitration motion which caused him to focus on certain issues to the exclusion of others. But this also could have been raised at the time of the hearing. Plaintiff has not presented any persuasive reasons to re-examine the court’s 10/8/14 ruling, and the motion for reconsideration is denied.

Plaintiff also moves for leave to file an amended complaint, but this is prohibited under the law. Once http://www.lacourt.org/tentativeRulingNet/ui/ResultPopup.aspx 1/2

1/6/2015 www.lacourt.org/tentativeRulingNet/ui/ResultPopup.aspx

an anti-SLAPP motion is filed, the plaintiff may not amend the complaint. This is especially true for a request to file an amended complaint after an anti-SLAPP motion has been granted. See Simmons v. Allstate (2001) 92 Cal.App.4th 1068, 1073 (“Allowing a SLAPP plaintiff leave to amend the complaint once the court finds the prima facie showing has been met would completely undermine the statute by providing the pleader a ready escape from section 425.16's quick dismissal remedy.”). Plaintiff’s request for leave to amend is denied.

Motion for Attorney Fees and Costs – Defendants have jointly moved for recovery of attorney fees and costs pursuant to CCP §425.16(c)(1) as the prevailing parties on the anti-SLAPP motion. The determination of what constitutes a reasonable fee generally begins with the “lodestar” (the number of hours reasonably expended multiplied by the reasonable hourly rate), which may be adjusted up or down by relevant factors. See Ketchum v. Moses (2001) 24 Cal.4th 1122, 1136.

Defendants request attorney fees totaling $125,250, calculated as 118.4 hours at the hourly rate of $750 for Gary S. Soter and 72.9 hours at the hourly rate of $500 for Kendrick L. Moxon. Defendants also seek costs of $2,832.50. Defendants have supported the motion with evidence of the experience and background of the attorneys, and with billing records which itemize the time spent. The declarations and time sheets are sufficient to support Defendants’ claims as to the time expended. See Lunada Biomedical v. Nunez (2014) 230 Cal.App.4th 459, 487-88. The records have been properly edited, with exclusion of time spent on the arbitration motion and other extraneous matters.

The court has considered all relevant factors in determining the reasonableness of Defendants’ attorney fee request, and will award a total of $87,675 in fees. This is approximately 70% of the amount requested, and the total request has been reduced to reflect duplication between the two law firms, the rather high hourly rates charged (particularly for Soter), and the reasonable scope of the work required for Defendants’ motions. In light of all the circumstances and the matters reviewed in this case, the court believes that $87,675 is an appropriate award. The court will also grant Defendants’ requested costs of $2,832.50, for a total award of $90,507.50.

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EXHIBIT B

1 2 SUPERIOR COURT OF THE STATE OF CALIFORNIA 3 FOR THE COUNTY OF LOS ANGELES 4 DEPARTMENT 56 HON. MICHAEL JOHNSON, JUDGE 5 6 ) ) 7 VANCE WOODWARD, ) ) CASE NO. BC540097 8 ) ) 9 PLAINTIFF, ) ) 10 VS. ) ) 11 ) CHURCH OF SCIENTOLOGY ) 12 INTERNATIONAL, ET. AL., ) ) 13 ) DEFENDANT. ) 14 ) ______________________________________) 15 16 REPORTER'S TRANSCRIPT OF PROCEEDINGS 17 WEDNESDAY, JANUARY 7, 2015 18 19 20 21 22 23 24 25 26 27 28 TRACY DYRNESS, CSR NO. 12323 OFFICIAL REPORTER PRO TEM

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1 APPEARANCES: 2 FOR PLAINTIFF: VANCE WOODWARD, ESQ. 3 ATTORNEY AT LAW 8335 W. SUNSET BOULEVARD 4 SUITE 247 WEST HOLLYWOOD, CALIFORNIA 90069 5 6 FOR DEFENDANT: GARY SCOTT SOTER, ESQ. 7 ATTORNEY AT LAW 22287 MULHOLLAND HIGHWAY 8 SUITE 169 CALABASAS, CALIFORNIA 91302 9 KENDRICK L. MOXON, ESQ. 10 ATTORNEY AT LAW 3500 W. OLIVE AVENUE 11 SUITE 300 BURBANK, CALIFORNIA 91505 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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1 CASE NUMBER: BC540097 2 CASE NAME: WOODWARD VS. CHURCH OF 3 SCIENTOLOGY INTERNATIONAL 4 LOS ANGELES, CALIFORNIA WEDNESDAY, JANUARY 7, 2015 5 DEPARTMENT 56 HON. MICHAEL JOHNSON, JUDGE 6 APPEARANCES: (AS HERETOFORE NOTED.) 7 TIME: 8:54 A.M. 8 9 THE COURT: WOODWARD VERSUS CHURCH OF SCIENTOLOGY, 10 ET. AL. YOUR APPEARANCES PLEASE. 11 MR. WOODWARD: GOOD MORNING, YOUR HONOR. VANCE 12 WOODWARD, REPRESENTING MYSELF AS PLAINTIFF. 13 MR. MOXON: GOOD MORNING, YOUR HONOR. KENDRICK 14 MOXON FOR THE CHURCH OF SCIENTOLOGY OF SAN FRANCISCO. 15 MR. SOTER: GOOD MORNING, YOUR HONOR. I'M GARY 16 SOTER ON BEHALF OF DEFENDANTS CHURCH OF SCIENTOLOGY 17 INTERNATIONAL, CHURCH OF SCIENTOLOGY WESTERN UNITED STATES 18 AND CHURCH OF SCIENTOLOGY FLAG SERVICE ORGANIZATION. 19 THE COURT: THIS IS HERE ON TWO MOTIONS, THE 20 PLAINTIFF'S MOTION FOR RECONSIDERATION AND LEAVE TO FILE 21 AN AMENDED COMPLAINT AND THE DEFENDANT'S MOTION FOR FEES 22 AND COSTS FOLLOWING THE GRANTING OF THEIR ANTI-SLAPP 23 MOTIONS IN OCTOBER OF LAST YEAR. LET'S TAKE THE MOTION BY 24 PLAINTIFF FIRST. I PREPARED TENTATIVE RULINGS ON BOTH OF 25 THEM. DO YOU WISH TO ADDRESS YOUR MOTION, MR. WOODWARD? 26 MR. WOODWARD: I DO, YOUR HONOR. THANK YOU. YOUR 27 HONOR, I SUBMITTED UNCONTRADICTED EVIDENCE THAT DEFENDANTS 28 SOLD ME GOODS AND SERVICES AT FIXED PREPAID PRICES WITH A

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1 PUBLICALLY-STATED REFUND POLICY THAT THEY WILL REFUND 2 PAYMENTS ON DEMAND. THEIR POLICY IS THAT REFUND DEMANDS 3 WILL BE PAID IN FULL WITH THE PROVISO OF DEFENDANTS 4 REFUSING TO SELL FURTHER GOODS AND SERVICES TO THAT 5 CUSTOMER. 6 I SUBMITTED WHAT EVIDENCE I COULD MUSTER IN THE 7 13 DAYS THAT I HAD TO PREPARE MY OPPOSITION TO DEFENDANTS' 8 ANTI-SLAPP MOTION; THAT'S IN MY FIRST DECLARATION, 9 PARAGRAPHS 149 TO 155, ALONG WITH ALL BUT ONE OF THE 13 10 EXHIBITS THAT I SUBMITTED WITH THAT DECLARATION, WHICH ARE 11 INVOICES, ACCOUNT STATEMENTS AND PRICE LISTS. DEFENDANTS 12 HAVE NOT CONTRADICTED THAT ORIGINAL EVIDENCE. DEFENDANTS 13 MERELY OBJECTED TO THE ADMISSIBILITY OF THEIR OWN IRS 14 SUBMISSION, WHICH WAS EXHIBIT PRJN1 OF MY REQUEST FOR 15 JUDICIAL NOTICE. 16 I PRODUCED MORE EVIDENCE WHEN I OBTAINED MORE. FOR 17 INSTANCE, I DID NOT HAVE ACCESS TO THE OEC VOLUMES BEFORE 18 THE HEARING ON DEFENDANTS' ANTI-SLAPP MOTION. I OBTAINED 19 THOSE AFTERWARDS. I PRODUCED THOSE EXHIBITS FROM THE OEC 20 VOLUMES WITH MY DECLARATIONS IN SUPPORT OF MY MOTION FOR 21 RECONSIDERATION AS EXHIBITS VWD14, 15, 16, 18, 22 AND 23. 22 I ALSO SUBMITTED UNCONTRADICTED EVIDENCE OF THE 23 DEFENDANTS' PUBLICALLY-STATED RETURN POLICY WITH MY MOTION 24 FOR RECONSIDERATION IN THE FORM OF DEFENDANTS' OWN IRS 25 SUBMISSION AS EXHIBIT VWD24, WHICH THEY HAVE NEVER DENIED 26 MAKING. AND MY DECLARATIONS THEMSELVES SHOW THAT 27 DEFENDANTS PUBLICALLY AND REPEATEDLY CLAIM THEY RETURN 28 FUNDS ON DEMAND. MY INABILITY TO OBTAIN SOME EVIDENCE

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1 SOONER IS REASONABLE FOR SEVERAL REASONS, ONE OF WHICH IS 2 I HAD NO WAY OF PREDICTING THAT THE COURT WOULD REJECT MY 3 ORIGINAL UNCONTRADICTED EVIDENCE OF DEFENDANTS' 4 PUBLICALLY-AVOWED REFUND POLICY. I HAD LESS THAN 5 TWO WEEKS TO COME UP WITH THE EVIDENCE OF ALL ELEMENTS IN 6 SUPPORT OF MY BREACH OF CONTRACT AND CONVERSION CLAIMS. 7 AT NO POINT DID ANYBODY CONTRADICT THE FACT THAT 8 THERE WAS A CONTRACT, NOR THE DEFENDANTS' 9 PUBLICALLY-STATED REFUND POLICY IS TO REFUND MONEY ON 10 DEMAND. NOW, THE OEC VOLUME EXHIBIT I SUBMITTED WITH MY 11 DECLARATIONS IN SUPPORT OF MY MOTION FOR RECONSIDERATION 12 WERE NOT IN MY POSSESSION. I OBTAINED THOSE LATER. I 13 OBTAINED A FEW THROUGH CONTACTS ON THE INTERNET THAT I 14 REACHED OUT TO LOOKING FOR THESE MATERIALS. THEN I WENT 15 TO THE L.A. COUNTY LIBRARY DOWNTOWN AND OBTAINED COPIES 16 MYSELF OF THE SAME DOCUMENTS. 17 I HAD NO ABILITY TO GET THOSE DOCUMENTS BEFORE OTHER 18 THAN, YOU KNOW, THE FACT THAT I SPENT OVER 100 HOURS 19 PREPARING MY OPPOSITIONS TO DEFENDANTS' TWO ORIGINAL 20 MOTIONS IN 13 DAYS AND DID SUBMIT EVIDENCE, ADMISSIBLE 21 EVIDENCE IN SUPPORT OF MY POSITION THAT THIS DEFENDANTS' 22 PUBLICALLY-STATED REFUND POLICY. 23 THE COURT: WHY WASN'T ANY OF THAT RAISED AT THE 24 HEARING IN OCTOBER? YOU'RE AN ATTORNEY. YOU KNOW THAT 25 THE ANTI-SLAPP STATUTE IS A FAIRLY UNIQUE PROCEDURE, WHICH 26 CAN BE TERMINAL. IT'S NOT A NEW LAW. IT'S BEEN AROUND 27 FOR SOME TIME, AND THERE'S DEVELOPED CASE LAW WHICH MAKES 28 IT VERY CLEAR THAT IT IS SOMETHING THAT MUST BE TAKEN

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1 SERIOUSLY. AND IF YOU'RE THE PLAINTIFF, YOU HAVE TO MAKE 2 YOUR BEST SHOWING AT THE TIME OF THE HEARING OR YOU'RE 3 SUBJECT TO THE ENTIRE CASE BEING DISMISSED WITHOUT THE 4 OPPORTUNITY TO FILE A NEW PLEADING OR PRESENT NEW EVIDENCE 5 OR THE KINDS OF THINGS YOU'VE DONE TODAY. IF YOU WERE 6 TRULY IN THIS BIND THAT YOU HAVE TRIED TO DESCRIBE, WHY 7 WASN'T ANY OF THAT RAISED AT THE HEARING? 8 MR. WOODWARD: I THINK THE MAIN REASON, YOUR HONOR, 9 IS NOBODY EVER DISPUTED THE FACT THAT DEFENDANTS' 10 PUBLICALLY-STATED REFUND POLICIES THAT THEY RETURN 11 PAYMENTS ON DEMAND. I DID PRESENT THAT EVIDENCE IN MY 12 ORIGINAL DECLARATION. DEFENDANTS NEVER CONTRADICTED IT. 13 THEY DID SUBMIT THEIR ENROLLMENT APPLICATION, WHICH DOES 14 NOT CONTRADICT THEIR PUBLICALLY-STATED REFUND POLICY. 15 IT'S SOMETHING ELSE. 16 THEY NEVER DISPUTED THAT FACT. ALL I DID IS 17 PROCEEDED TO GATHER EVEN MORE EVIDENCE IN SUPPORT OF MY 18 POSITION, WHICH I HAD NO IDEA THAT THE COURT WOULD REJECT 19 MY EVIDENCE ON THE ORIGINAL MOTION THAT I HAD PERSONAL 20 KNOWLEDGE OF AND STATED AS MUCH IN MY DECLARATION. 21 THE COURT: ANYTHING ELSE? 22 MR. WOODWARD: YES, YOUR HONOR. I WAS JUST ABOUT TO 23 RAISE THE DEFENDANTS' ENROLLMENT APPLICATION IS 24 UNCONSCIONABLE AND UNENFORCEABLE FOR A VARIETY OF REASONS, 25 WHICH I BRIEFED IN MY OPPOSITION TO DEFENDANTS' 26 ARBITRATION MOTION AND MY OPPOSITION TO THE ANTI-SLAPP 27 MOTION. I BROUGHT THIS UP AT THE OCTOBER 6TH HEARING AND 28 EXPLAINED WHY IT MATTERS. THE DEFENDANT CORPORATION'S

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1 CLAIMED RELIGIOUS STATUS. THE FACT THAT THE DEFENDANT 2 CORPORATION CLAIMED RELIGIOUS STATUS DOES NOT CHANGE THE 3 FACT THAT THEY ENTERED INTO COMMERCIAL TRANSACTIONS. THE 4 SUPREME COURT OF THE UNITED STATES HAS ALREADY RULED THAT 5 THE EXACT TYPE OF TRANSACTION AT ISSUE; NAMELY, THE 6 EXCHANGE OF MONEY FOR SCIENTOLOGY COUNSELING AND COURSES 7 AT FIXED PRICES IS A QUID PRO QUO TRANSACTION, NOT 8 DONATIVE; THAT'S THE HERNANDEZ CASE. 9 MOREOVER, DEFENDANTS ADMITTED IN THEIR ARBITRATION 10 MOTION FILED IN THIS MATTER AT PAGES 13 TO 14 THAT THESE 11 ARE COMMERCIAL TRANSACTIONS. THEY ASSERTED THE 12 APPLICABILITY OF THE FEDERAL ARBITRATION ACT, WHICH ONLY 13 APPLIES TO TRANSACTIONS INVOLVING COMMERCE; THAT IS IN 14 DEFENDANTS' ARBITRATION MOTION. I ASK THE COURT TO TAKE 15 JUDICIAL NOTICE OF DEFENDANTS' ARBITRATION MOTION AND OF 16 PLAINTIFF'S OPPOSITION TO DEFENDANTS' ARBITRATION MOTION. 17 YOUR HONOR, I ATTEMPTED TO DO SO AT THE ORIGINAL HEARING. 18 I FELT THAT I WAS BEING CUTOFF. IN LOOKING AT THE 19 TRANSCRIPT NOW, I SEE WE WERE TALKING OVER EACH OTHER. I 20 APOLOGIZE FOR THAT, BUT I DID ATTEMPT TO BRING THIS UP AND 21 RAISE IT AT THE HEARING. I SUBMITTED UNCONTRADICTED 22 EVIDENCE THAT DEFENDANTS' PUBLICLY STATE THAT THEY REFUND 23 MONEY ON DEMAND. I SUBMITTED UNCONTRADICTED EVIDENCE THAT 24 IN MY INSTANCE I PREPAID FOR GOODS AND SERVICES FROM 25 DEFENDANTS IN RELIANCE ON THEIR PUBLICALLY-STATED REFUND 26 POLICY AMONG OTHER REPRESENTATIONS. I SUBMITTED 27 UNCONTRADICTED EVIDENCE IN MY INSTANCE DEFENDANTS 28 COMPLETELY REJECTED MY REFUND DEMAND, WHICH WAS SOLELY FOR

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1 THE REFUND OF UNUSED MONEY THAT I HAVE ON ACCOUNT WITH 2 THEM. THAT'S ALL IN MY FIRST DECLARATION FILED WITH MY 3 OPPOSITION TO DEFENDANTS' ANTI-SLAPP MOTION. SCIENTOLOGY 4 IS A RELIGION. I DO NOT DISPUTE THAT. THIS IS NOT A 5 RELIGIOUS DISPUTE. IT IS A COMMERCIAL DISPUTE. NO CASES 6 EVER HELD THAT THIS UNCONTRADICTED FACTUAL SCENARIO 7 PRESENTS AN NONJUSTICIABLE RELIGIOUS DISPUTE REGARDLESS OF 8 WHAT ADDITIONAL ALLEGATIONS REMAIN. NO CASE HAS EVER HELD 9 THAT ADVERTISING SPEECH ABOUT ONE'S OWN PRODUCTS IS SPEECH 10 PROTECTED BY THE ANTI-SLAPP STATUTE. 11 IT'S NOT PROTECTED BY THE ANTI-SLAPP STATUTE, WHICH 12 COMES FROM THE SCOTT VERSUS METABOLIFE CASE, WHICH I CITED 13 IN MY PAPERS; THAT'S WHERE THE COURT OF APPEAL EXPLAINS 14 HOW IT IS THAT DEFENDANTS' ADVERTISING SPEECH ABOUT THEIR 15 OWN SERVICES AND PRODUCTS DO NOT FALL WITHIN THE PURVIEW 16 OF THE ANTI-SLAPP STATUTE BECAUSE, AMONG OTHER THINGS, IT 17 IS NOT A MATTER OF PUBLIC INTEREST FOR ANTI-SLAPP 18 PURPOSES. 19 THE APPEALS COURT WROTE, "A MANUFACTURER DOES NOT 20 ENGAGE IN ACTIVITIES PROTECTED BY THE FIRST AMENDMENT WHEN 21 IT PRODUCES A PRODUCT THAT DOES MEET ITS WARRANTED OR 22 REPRESENTED CHARACTERISTICS." IT'S ON PAGE 417 OF THE 23 SCOTT VERSUS METABOLIFE. THE COURT CONTINUED AT PAGE 422, 24 "IN REJECTING THE DEFENDANT'S ARGUMENT THAT THE SUBJECT OF 25 HERBAL DIETARY SUPPLEMENTS IS THE SUBJECT OF PUBLIC 26 INTEREST. THE COURT CONCLUDED THE TOPIC OF THE LAWSUIT 27 WAS NOT HERBAL MEDICINE IN GENERAL. BUT RATHER THIS 28 MANUFACTURER'S MISREPRESENTATIONS ABOUT THE SPECIFIC

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1 BENEFITS OF THIS SPECIFIC PRODUCT. THE COURT FOUND THAT 2 THAT KIND OF SPEECH IS NOT FIRST AMENDMENT SPEECH. THIS 3 IS THE RATIONAL OF SCOTT VERSUS METABOLIFE, AND IT APPLIES 4 HERE. THIS IS NOT A DISPUTE ABOUT RELIGIOUS SPEECH, BUT 5 RATHER A DISPUTE ABOUT DEFENDANTS', QUOTE, 6 MISREPRESENTATIONS ABOUT THE SPECIFIC PROPERTIES AND 7 BENEFITS OF THIS SPECIFIC PRODUCT." SO, YOUR HONOR, I HAD 8 NO REASONABLE WAY OF ANTICIPATING THAT THE COURT'S RULING 9 WOULD, IN EFFECT, CREATE LAW CONTRADICTORY TO THE APPEAL 10 COURT'S DECISIONS. 11 AND IN LIGHT OF THE COURT'S RULING, I DID GO OUT AND 12 OBTAIN MORE EVIDENCE IN SUPPORT OF THE FACT THAT 13 DEFENDANTS PUBLICALLY STATE THEY HAVE A CERTAIN RETURN 14 POLICY, WHICH IS TO REFUND MONEY ON DEMAND. IT'S NEVER 15 BEEN CONTRADICTED. IT NEVER WAS CONTRADICTED IN MY 16 ORIGINAL OPPOSITION. IT HASN'T BEEN CONTRADICTED NOW IN 17 CONNECTION WITH MY MOTION FOR RECONSIDERATION. 18 THE COURT: THANK YOU. ANY ARGUMENT BY THE DEFENSE? 19 MR. SOTER: YOUR HONOR, BRIEFLY. THE COURT'S 20 TENTATIVE IS CORRECT AS A MATTER OF LAW. THERE'S A GOOD 21 REASON THAT MR. WOODWARD NEVER CITED A SINGLE CASE ARISING 22 UNDER CCP SECTION 1008 BECAUSE THOSE CASES ARE 23 DISPOSITIVE. THE CASE THAT IS PRIMARILY ON POINT IS NEW 24 YORK TIMES VERSUS SUPERIOR COURT, IN WHICH JUSTICE EPSTEIN 25 REVERSED A TRIAL COURT THAT GRANTED RECONSIDERATION BASED 26 ON DEPOSITION TESTIMONY THAT WAS OBTAINED ONLY TWO DAYS 27 BEFORE THE SUMMARY JUDGMENT HEARING BECAUSE THE COURT 28 FOUND THAT THE EVIDENCE THAT WAS PRESENTED WAS WITHIN THE

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1 CONTROL OF THE OBJECTING PARTY, THE PARTY THAT SOUGHT 2 RECONSIDERATION. BECAUSE IT WAS WITHIN THE CONTROL, THE 3 PARTY HAD AN OBLIGATION TO PRESENT IT TO THE COURT AT THE 4 TIME OF THE SUMMARY JUDGMENT MOTION OR AT THE VERY LEAST 5 SEEK A CONTINUANCE OF THE HEARING. THERE ARE NO NEW FACTS 6 HERE. 7 ALL THE FACTS THAT MR. WOODWARD DESCRIBES HE SAYS 8 WERE PUBLICALLY AVAILABLE OR KNOWN TO HIM WHEN HE FILED 9 HIS OPPOSITION IN JUNE. WHEN HE APPEARED IN FRONT OF THIS 10 COURT IN JULY AT THE CASE MANAGEMENT CONFERENCE AND WHEN 11 HE ARGUED THE MOTION ON OCTOBER 8TH, HE NEVER ASKED FOR A 12 CONTINUANCE. HE NEVER TOLD THE COURT THAT HE NEEDED MORE 13 TIME. HE NEVER ASKED US FOR A CONTINUANCE. EVEN WHEN WE 14 WERE HERE ON A CASE MANAGEMENT CONFERENCE ON JULY 31ST AND 15 I SAID TO THE COURT, MR. WOODWARD'S FILED LENGTHY 16 OPPOSITION. WE NEED FIVE EXTRA PAGE. THE COURT GAVE IT 17 TO ME. 18 MR. WOODWARD DIDN'T ASK FOR MORE TIME. HE DIDN'T 19 SAY HE NEEDED ADDITIONAL TIME. HE COULD HAVE, UNDER THE 20 COURT RULES, SUPPLEMENTED HIS PAPERS UP UNTIL THE END OF 21 SEPTEMBER AND CHOSE NOT TO. AND WHAT HE'S SAYING TO THE 22 COURT TODAY IS THAT HE REALLY DIDN'T THINK IT WAS 23 NECESSARY TO SAY ANYTHING ELSE. THAT HIS OPPOSITION WAS 24 ADEQUATE AND HE DIDN'T REALIZE THE SIGNIFICANCE OF THE 25 MOTION UNTIL THE COURT RULED. NEW YORK TIMES VERSUS 26 SUPERIOR COURT SPECIFICALLY SAYS THAT IF THE PARTY DID NOT 27 SUBMIT EVIDENCE BECAUSE HE DIDN'T THINK IT WAS NECESSARY 28 TO DO SO, THAT IS INSUFFICIENT AS A MATTER OF LAW FOR A

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1 MOTION FOR RECONSIDERATION. MR. WOODWARD SAYS WE SPOKE 2 OVER EACH OTHER AT THE HEARING. HE REALLY DIDN'T HAVE AN 3 OPPORTUNITY TO ARGUE THE CASE FULLY AT THE OCTOBER 6TH 4 HEARING. THE TRANSCRIPT SAYS THE OPPOSITE. THE COURT TO 5 MR. WOODWARD, "YOU CAN DISCUSS WHATEVER YOU WOULD LIKE IN 6 RELATION TO THE ANTI-SLAPP MOTION." MR. WOODWARD MADE A 7 PROFFER OF EVIDENCE THAT WAS UNAFFECTED BY THE WITHDRAWAL 8 OF THE DEFENDANTS' MOTION TO COMPEL ARBITRATION. 9 THIS IS BECAUSE THE AFFIDAVIT, THE DECLARATIONS THAT 10 WERE FILED BY MR. WOODWARD WERE SUBMITTED IN OPPOSITION TO 11 BOTH MOTIONS. HE HAD A FULL AND FAIR OPPORTUNITY TO 12 ADDRESS ALL THE ISSUES AND NONE OF THESE FACTS RELATE TO 13 THE COURT'S FINDING IN ITS MINUTE ORDER THAT PLAINTIFF'S 14 RELIGIOUS CHALLENGES HAVE CONFUSED ALL OF HIS CAUSES OF 15 ACTION AND ARE SO PREDOMINANT IN HIS ARGUMENTS. THIS IS 16 NOT A CASE IN WHICH RELIGIOUS PARTIES HAVE PRESENTED A 17 DISCREET PROPERTY DISPUTE THAT CAN BE DETERMINED BY 18 NEUTRAL PRINCIPLES OF LAW. 19 EVEN IF WE WERE TO CREDIT SOME OF THIS NEW 20 PUBLICALLY-AVAILABLE INFORMATION, IT DOESN'T CHANGE THE 21 COURT'S CORE DECISION IN THIS CASE; THAT THIS CONTROVERSY 22 PLED BY MR. WOODWARD IS NOT JUSTICIABLE. 23 THE COURT: THANK YOU. ANYTHING ELSE BY THE 24 CODEFENDANTS? 25 MR. MOXON: VERY BRIEFLY, YOUR HONOR. I WISH TO 26 MAKE SURE THAT THE RECORD IS CLEAR THAT AT THE LAST 27 HEARING, MR. WOODWARD WAS NEVER CUTOFF. THE COURT VERY 28 PROFESSIONALLY AND JUDICIALLY GAVE HIM ALL THE TIME HE

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1 WANTED AND ASKED IF HE HAD ANY MORE ARGUMENT. I JUST WANT 2 THAT TO BE QUITE CLEAR FOR THE RECORD. LASTLY, THE 3 ASSERTIONS -- I MUST HAVE HEARD MR. WOODWARD SAY 15 OR 20 4 TIMES ALL THE THINGS THAT WERE UNCONTRADICTED. THAT'S 5 JUST SIMPLY NOT THE CASE. THERE'S NOTHING THAT WAS 6 UNCONTRADICTED. 7 AS MR. SOTER JUST MENTIONED, THE RELIGIOUS ISSUES 8 WOULD HAVE BEEN SUCH THAT THE COURT WOULD HAVE TO 9 ADJUDICATE WHAT WAS RELIGIOUS AND WHAT WAS NOT IN HIS 10 INTERPRETATION VERSUS THE CHURCH'S INTERPRETATION OF THESE 11 MATTERS THAT HE RAISED AND ALLEGED POLICIES. IT COULDN'T 12 BE DONE BY THE COURT. I HAVE NOTHING ELSE TO ADD TO WHAT 13 MR. SOTER HAS JUST SAID. 14 THE COURT: THANK YOU. ANYTHING ELSE BY PLAINTIFF? 15 MR. WOODWARD: YES, YOUR HONOR. 16 THE COURT: BRIEFLY PLEASE. 17 MR. WOODWARD: THE EVIDENCE THAT I SUBMITTED IN 18 SUPPORT OF MY MOTION FOR RECONSIDERATION WAS NOT IN MY 19 CONTROL OR POSSESSION WHEN THE HEARING HAPPENED OR BEFORE 20 THEN. THE EVIDENCE I OBTAINED FROM VOLUMES THAT ARE IN 21 DEFENDANT'S POSITION. WE'VE DONE NO DISCOVERY. 22 I DID NOT KEEP -- ONCE I CEASED BEING A CUSTOMER OF 23 THE CHURCH OF SCIENTOLOGY, I GOT RID OF NEARLY ALL MY 24 MATERIALS, INCLUDING ANY MATERIALS LIKE THIS THAT I HAD. 25 I DID NOT HAVE ACCESS TO THESE MATERIALS. IT WAS NOT IN 26 MY POSSESSION. I DID NOT MAKE A STRATEGIC DECISION NOT TO 27 SUBMIT THIS ADDITIONAL EVIDENCE CONTRARY TO DEFENSE 28 COUNSEL HAS CLAIMED. MOREOVER, THE ISSUE HERE IS THE FACT

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1 THAT DEFENDANTS WITHDREW THEIR ARBITRATION MOTION AT THE 2 LAST SECOND, NOT THAT I JUST RESTED ON MY LAURELS FOR 3 MONTHS WHILE I COULD HAVE BEEN GATHERING MORE EVIDENCE. 4 THAT HEAD FAKE I TRIED TO BRING UP AT THE HEARING. THE 5 HEARING TRANSCRIPT I HAVE ATTACHED TO, I BELIEVE, MY 6 DECLARATION IN OPPOSITION TO THE ATTORNEY'S FEE MOTION BUT 7 WHAT ACTUALLY WAS STATED IN FULL IS I SAID, "THAT TIES 8 INTO DEFENDANTS' ARBITRATION MOTION BECAUSE ARBITRATION 9 MOTIONS ARE APPEALABLE. 10 IF YOU LOSE AN ARBITRATION MOTION, YOU HAVE THE 11 RIGHT OF APPEAL. WHAT I FORESEE HAPPENING HERE 12 POTENTIALLY IS --". THE COURT STATED, "WELL, THAT MOTION 13 HAS BEEN WITHDRAWN." I STATED, "IT HAS NOT. IT HAS BEEN 14 TAKEN OFF CALENDAR. I BELIEVE THERE'S A DIFFERENCE." THE 15 COURT STATED, "WELL, IT'S NOT BEFORE ME. ARE THE 16 DEFENDANTS ASSERTING ANY?" MR. MOXON STATED, "NO, YOUR 17 HONOR." THE COURT, "IT'S NOT BEFORE ME. I HAVEN'T EVEN 18 READ IT." SO I STATED, "WELL, YOUR HONOR, I WOULD LIKE TO 19 ADDRESS THIS." 20 THE COURT, "NO. I MEAN I HAVE NOT EVEN READ IT. 21 IT'S NOT ON THE CALENDAR TODAY. IT'S BEING WITHDRAWN. 22 IT'S NOT AT ISSUE." MR. WOODWARD, "I BELIEVE THE 23 SUBSTANCE--". THE COURT, "WE HAVE GOT PLENTY TO TALK 24 ABOUT IN REGARD TO THE ANTI-SLAPP MOTION, BUT THERE IS NO 25 ARBITRATION MOTION BEFORE THE COURT." "UNDERSTOOD, YOUR 26 HONOR. THERE ARE ARGUMENTS BEFORE THE COURT WITH RESPECT 27 TO THE VALIDITY OF THESE ENROLLMENT APPLICATIONS THAT I 28 CITE." THE COURT, "YOU CAN DISCUSS WHATEVER YOU LIKE IN

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1 RELATION TO THE ANTI-SLAPP MOTION, BUT NOT MOTIONS THAT 2 HAVE BEEN WITHDRAWN." I STATED, "HAVE THEY BEEN WITHDRAWN 3 WITH PREJUDICE, YOUR HONOR, OR WITH THE RIGHT TO RE-BRING 4 THEM?" THE COURT, "IT'S NOT BEFORE ME. I DON'T HAVE IT. 5 IT'S NOT ON CALENDAR. IT HAS BEEN WITHDRAWN." 6 "UNDERSTOOD, YOUR HONOR. NOW, DEFENDANTS' COUNSEL HAVE 7 RAISED THE ISSUE OF THESE ENROLLMENT APPLICATIONS WHICH 8 WERE THE SUBJECT OF THE ARBITRATION MOTION. 9 THEY ARE RIGHT BACK HERE TODAY CLAIMING THAT I 10 SIGNED THESE AGREEMENTS, WHICH I HAVE ACCORDING TO THESE 11 APPLICATIONS, WHICH I HAVE." THEN I GO ON TO SAY THEY'RE 12 NOT BINDING CONTRACTS, AND I EXPLAIN ONE OF THE REASONS 13 WHY. YOUR HONOR, I DID HONESTLY TRY TO BRING THIS UP. I 14 FELT THAT I WAS BEING TOLD NOT TO DISCUSS THE ARBITRATION 15 MOTION WHATSOEVER. I DIDN'T KNOW WHAT TO DO. I RAISED 16 THE ISSUE. 17 I RAISED THE ARBITRATION MOTION. I DID TRY. MR. 18 MOXON SAYS THAT I HAVE RAISED RELIGIOUS BELIEFS THAT NEED 19 ADJUDICATION OR RATHER I RAISED ISSUES THAT WILL REQUIRE 20 THE COURT TO DECIDE WHAT IS A RELIGIOUS BELIEF AND WHAT IS 21 NOT. THAT'S NOT TRUE. NEITHER COUNSEL OR DEFENDANTS HAVE 22 EVER STATED A SINGLE RELIGIOUS BELIEF THAT I AM ASKING 23 COURT TO ADJUDICATION, NOT ONE. THEY ALSO SAY THAT MY 24 EVIDENCE HAS BEEN CONTRADICTED OR RATHER IT HAS NOT BEEN 25 UNCONTRADICTED, WHICH IS FALSE. DEFENDANTS HAVE NEVER 26 CLAIMED OR SUBMITTED ANY EVIDENCE TO THE EFFECT THAT THEY 27 DO NOT HAVE A PUBLICALLY-STATED REFUND POLICY, SAYING THAT 28 THEY REFUND MONEY ON REQUEST. THEY NEVER SUBMITTED ANY

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1 EVIDENCE SHOWING THAT OR INDICATING THAT. THEREFORE, MY 2 EVIDENCE THAT THEY DO HAVE THAT PUBLICALLY-STATED REFUND 3 POLICY IS UNCONTRADICTED, BOTH IN MY OPPOSITION TO THE 4 ANTI-SLAPP MOTION AND IN MY MOTION FOR RECONSIDERATION. I 5 USED ALL THE DILIGENCE I COULD. I BELIEVE IT WAS VERY 6 REASONABLE, THE EFFORT I PUT INTO OPPOSING DEFENDANTS' 7 MOTION, ANTI-SLAPP MOTION, YOUR HONOR. IT'S NOT A 8 SITUATION WHERE I FAILED TO EXERCISE REASONABLE DILIGENCE 9 OBTAINING THIS EVIDENCE. 10 THE COURT: THANK YOU. THE RULING IS ADOPTED. AS I 11 TRIED TO EXPRESS, I THINK THIS IS MERELY AN EFFORT TO 12 REARGUE THE MATTER IN LIGHT OF AN ADVERSE RULING. THAT IS 13 NOT APPROPRIATE FOR RECONSIDERATION. I'M NOT GOING TO 14 ELABORATE ON ANY POINTS OTHER THAN THE HEARING ON 15 OCTOBER 6TH. I THINK THE RECORD SHOULD REFLECT THAT I 16 GAVE MR. WOODWARD EVERY OPPORTUNITY TO RAISE WHATEVER 17 POINTS HE WANTED IN RESPECT TO THE ANTI-SLAPP RULING AND 18 MOTION. 19 WHAT HAS BEEN QUOTED IS AN EXCHANGE IN WHICH MR. 20 WOODWARD SEEMED TO WANT, IN MY ESTIMATION, TO ARGUE A 21 MOTION WHICH WAS NOT BEFORE THE COURT. HE WANTED TO ARGUE 22 THE ARBITRATION MOTION, WHICH HAD BEEN WITHDRAWN. AND HIS 23 REQUEST OR HIS OBSERVATION OR WHATEVER IT WAS ABOUT 24 WHETHER IT WAS WITHDRAWN WITH PREJUDICE OR WITHOUT 25 PREJUDICE SEEMED TO ME TO BE AN EAGERNESS TO GET INTO THE 26 ARBITRATION ISSUES, WHICH WERE NOT BEFORE THE COURT. AS I 27 CANDIDLY EXPRESSED, I HADN'T EVEN READ IT BECAUSE IT HAD 28 BEEN WITHDRAWN. IT WASN'T SOMETHING WE NEEDED TO ADDRESS.

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1 IF MR. WOODWARD HAD SOME POINT ABOUT THE ARBITRATION 2 ISSUES THAT RELATED TO THE ANTI-SLAPP MOTION, HE WAS 3 CERTAINLY WELCOME TO EXPRESS THOSE. AND I THINK AS AN 4 ATTORNEY, IT WAS HIS OBLIGATION TO MAKE IT CLEAR TO ME 5 THAT HE WAS NOT INTENDING TO ARGUE A MOTION WHICH HAD BEEN 6 WITHDRAWN, BUT THAT HE WAS INSTEAD INTERESTED IN 7 EXPRESSING SOME POINTS ABOUT THE ARBITRATION ISSUES THAT 8 RELATED TO THE ANTI-SLAPP MOTION AND NONE OF THAT WAS 9 EXPRESSED. 10 SO THE MOTION FOR RECONSIDERATION AND MOTION FOR 11 LEAVE ARE BOTH DENIED. THE OTHER MATTER BEFORE THE COURT 12 IS THE DEFENSE MOTION FOR ATTORNEY'S FEES AND COSTS. I 13 PREPARED A TENTATIVE ON THAT, WHICH AWARDS COSTS IN A 14 REDUCED AMOUNT. DO YOU WISH TO ADDRESS THAT AS MOVING 15 PARTIES. 16 MR. SOTER: I'LL SUBMIT ON THE COURT'S TENTATIVE. 17 MR. MOXON: SUBMIT, YOUR HONOR. 18 THE COURT: DO YOU WISH TO ADDRESS THAT, MR. 19 WOODWARD? 20 MR. WOODWARD: I DO, YOUR HONOR. REGARDING 21 DEFENDANTS' FEES MOTION, THE COURT STATED IN ITS TENTATIVE 22 RULING THAT MR. SOTER CHARGES $750 PER HOUR. THERE'S NO 23 EVIDENCE THAT HE'S EVER CHARGED THAT RATE. I DON'T 24 BELIEVE HE EVEN CLAIMS TO HAVE EVER CHARGED THAT MUCH. 25 RATHER, HE MERELY OPINED THAT HIS SERVICES ARE REASONABLY 26 WORTH $750 PER HOUR, AN OPINION WHICH IS INADMISSIBLE 27 BECAUSE HE BELIEVES THAT HIS FRIENDS CHARGE THAT MUCH OR 28 HIS ASSOCIATES OR ACQUAINTANCES. NOBODY'S EVER PAID MR.

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1 SOTER $750 PER HOUR SO FAR AS THE EVIDENCE SHOWS. IT IS 2 NOT CORRECT TO STATE THAT MR. SOTER CHARGES $750 PER HOUR. 3 HE DOES NOT CHARGE $750 PER HOUR. MOREOVER, DEFENDANTS 4 SUBMITTED NO EVIDENCE OF WHAT A REASONABLE AMOUNT OF TIME 5 IS FOR BRINGING AN ANTI-SLAPP MOTION. THE ONLY SUBMITTED 6 SUPPOSED EVIDENCE OF HOW MUCH TIME THEY TOOK IN THE FORM 7 OF EXHIBITS WITHOUT LAYING ANY FOUNDATION FOR THEIR 8 ADMISSIBLE. 9 THE COURT REFERS TO THEM IN THE TENTATIVE RULINGS AS 10 BILLING RECORDS, BUT DEFENDANTS' ATTORNEYS NEVER CLAIM 11 THAT THEIR EXHIBITS ARE BILLING RECORD. INDEED, THEY 12 NEVER CLAIMED WHAT THEY CHARGED DEFENDANTS FOR THEIR 13 SERVICES. THOSE EXHIBITS ARE NOT BILLING RECORDS. THE 14 DEFENDANTS' ATTORNEYS SIMULTANEOUSLY CLAIM TO BE 15 ANTI-SLAPP AND RELIGIOUS SPEECH EXPERTS AND THAT THEY TOOK 16 NEARLY 200 HOURS TO BRING THEIR ANTI-SLAPP MOTION WITHOUT 17 ANY ADMISSIBLE EVIDENCE OF AS MUCH. I OBJECT TO THE 18 ADMISSION OF DEFENDANTS' DECLARATIONS AND THEIR EXHIBITS 19 FOR LACK OF FOUNDATION. 20 MOREOVER, DEFENDANTS DID NOT SUBMIT ANY EVIDENCE OF 21 REASONABLE MARKET RATES. RATHER, THEY ASKED FOR RATES 22 ABOVE WHAT THEY HAVE EVER CHARGED AND WAY ABOVE THE MARKET 23 RATE FOR THEIR WORK AS REFLECTED IN MY EXHIBIT VWD20, 24 WHICH IS A SURVEY OF ATTORNEY RATES ACROSS MANY 25 DIMENSIONS. THEREFORE, DEFENDANTS' ATTORNEYS OVERREACHED 26 IN THEIR FEE MOTION. THEY ASK FOR UNREASONABLY-INFLATED 27 RATES, WHICH IS THE EXACT SPECIAL CIRCUMSTANCE IDENTIFIED 28 IN SERRANO VERSUS UNRUH AT PAGE 635, WHICH I CITED, THAT

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1 WARRANTS A COMPLETE DENIAL OF A FEE MOTION. I REQUEST 2 THAT THE COURT DENY DEFENDANTS' FEE MOTION ON THAT BASIS. 3 THANK YOU. 4 THE COURT: ANYTHING BY THE MOVING PARTIES? 5 MR. SOTER: NO, YOUR HONOR. 6 MR. MOXON: NO, YOUR HONOR. 7 THE COURT: THE TENTATIVE RULING IS ADOPTED. I 8 CONSIDERED ALL OF THE EVIDENCE BEFORE ME. THE OBJECTIONS 9 TO THE DECLARATIONS PRESENTED BY THE DEFENSE ARE 10 OVERRULED. I HEAR SO MANY ANTI-SLAPP MOTIONS. I THINK 11 I'M BECOMING AN EXPERT ON THE AMOUNT OF WORK REQUIRED AND 12 THE FEES THAT ARE BILLED, NOT ONLY FOR ANTI-SLAPP, BUT FOR 13 DISCOVERY DISPUTES AND TRIALS AND SO FORTH. IT SEEMS LIKE 14 HARDLY A WEEK GOES BY WHERE I'M NOT CALCULATING FEES IN 15 SOME WAY. 16 THAT'S WHAT I TRIED TO DO HERE. I THINK THERE WAS 17 AN ENORMOUS AMOUNT OF WORK INVOLVED, FIRST OF ALL. THERE 18 WAS FROM MY STANDPOINT JUST FROM REVIEWING THE PAPERS AND 19 A GREAT DEAL MORE BY THOSE WHO PREPARED THE PAPERS. MR. 20 WOODWARD, HIMSELF, SAID HE SPENT OVER A HUNDRED HOURS JUST 21 ON HIS OPPOSITION. FRANKLY, NONE OF THAT SURPRISES ME. 22 BUT WHAT I TRIED TO DO HERE IS TAKE INTO ACCOUNT ALL 23 OF THE WORK THAT WAS DONE, THE HOURLY RATES AND REACH WHAT 24 I BELIEVE TO BE A FAIR AND REASONABLE AWARD FOR EVERYTHING 25 THAT I SAW, WHICH IS NOT ONLY BASED ON WHAT WAS PRESENTED 26 TO ME HERE, BUT ON MY EXPERIENCE WITH COMPARABLE MOTIONS 27 AND FEE APPLICATIONS BY WHAT I VIEW TO BE COMPARABLE 28 ATTORNEYS. I DID PUT A GREAT DEAL OF THOUGHT INTO. THIS

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1 IS SOMETHING I'M ENTIRELY COMFORTABLE WITH. 2 MR. MOXON: THANK YOU, YOUR HONOR. 3 MR. SOTER: THANK YOU, YOUR HONOR. 4 THE COURT: THE RULINGS WILL BE INCORPORATED INTO 5 THE MINUTE ORDER FOR TODAY. DO YOU BOTH WAIVE NOTICE OF 6 THE RULINGS? 7 MR. SOTER: YES, YOUR HONOR. I HAVE A PROPOSED 8 JUDGMENT BASED ON THE COURT'S TENTATIVE I WOULD LIKE TO 9 HAND UP TO THE COURT. 10 THE COURT: HAVE YOU GIVEN THAT TO MR. WOODWARD? 11 MR. SOTER: I'M DOING SO NOW. 12 THE COURT: WOULD YOU LIKE TO ADDRESS THAT TODAY OR 13 DO YOU WANT TIME TO REVIEW IT, MR. WOODWARD? 14 MR. WOODWARD: I'D LIKE TIME TO REVIEW IT, YOUR 15 HONOR. 16 THE COURT: YOU CAN SUBMIT IT TODAY. ANY OBJECTIONS 17 SHOULD BE PRESENTED IN FIVE DAYS. 18 MR. WOODWARD: UNDERSTOOD. 19 THE COURT: THANK YOU VERY MUCH. 20 MR. WOODWARD: THANK YOU, YOUR HONOR. 21 22 (THE PROCEEDINGS IS CONCLUDED.) 23 24 25 26 27 28

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1 2 SUPERIOR COURT OF THE STATE OF CALIFORNIA 3 FOR THE COUNTY OF LOS ANGELES 4 DEPARTMENT 56 HON. MICHAEL JOHNSON, JUDGE 5 6 ) ) 7 VANCE WOODWARD, ) ) CASE NO. BC540097 8 ) ) REPORTER'S 9 PLAINTIFF, ) ) CERTIFICATE 10 VS. ) ) 11 ) CHURCH OF SCIENTOLOGY ) 12 INTERNATIONAL, ET. AL., ) ) 13 ) DEFENDANT. ) 14 ) ______________________________________) 15 16 I, TRACY DYRNESS, OFFICIAL REPORTER PRO TEM OF THE 17 COURT OF THE STATE OF CALIFORNIA, FOR THE COUNTY OF LOS 18 ANGELES, DO HEREBY CERTIFY THAT THE FOREGOING PAGES, 1 19 THROUGH 19, COMPRISE A FULL, TRUE, AND CORRECT TRANSCRIPT 20 OF THE PROCEEDINGS HELD IN THE ABOVE-ENTITLED MATTER ON 21 WEDNESDAY, JANUARY 7, 2015. 22 23 DATED THIS 29TH DAY OF JANUARY, 2015. 24

Footnotes

[25] ____________________________________, CSR NO. 12323 OFFICIAL REPORTER 26 27 28 20 Coalition of Court Reporters of Los Angeles

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