david gingras affidavit re anti-slapp

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David S. Gingras, #021097Gingras Law Office, PLLC3961 E. Chandler Blvd., #111-243Phoenix, AZ 85048Tel.: (480) 668-3623Fax: (480) [email protected]

Attorney for Plaintiff/CounterdefendantXcentric Ventures, LLC

UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

XCENTRIC VENTURES, LLC, anArizona limited liability company,

Plaintiff,

v.

LISA JEAN BORODKIN et al.,

Defendants.

RAYMOND MOBREZ,

Counterclaimant,

v.

XCENTRIC VENTURES, LLC andEDWARD MAGEDSON,

Counterdefendants.

Case No.: 11-CV-1426-GMS

AFFIDAVIT OF DAVID S. GINGRAS INSUPPORT OF PLAINTIFF’S RESPONSETO DEFENDANTS RAYMOND MOBREZAND ILIANA LLANERAS’SSPECIAL MOTION TO STRIKE ANDMOTION TO STAY DISCOVERY

I, David S. Gingras declare as follows:

1. My name is David Gingras. I am a United States citizen, a resident of the

State of Arizona, am over the age of 18 years, and if called to testify in court or other

proceeding I could and would give the following testimony which is based upon my own

personal knowledge unless otherwise stated.

Case 2:11-cv-01426-GMS Document 181-1 Filed 12/24/12 of 48

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2. I am an attorney licensed to practice law in the States of Arizona and

California, I am an active member in good standing with the State Bars of Arizona and

California and I am admitted to practice and in good standing with the United States

District Court for the District of Arizona and the United States District Court for the

Northern, Central, and Eastern Districts of California.

3. I represented Xcentric Ventures, LLC and Edward Magedson in the lawsuit

filed against them in California entitled Asia Economic Institute, LLC, et al. v. Xcentric

Ventures, LLC, et al., Case No. 10-cv-1360 (the “California Litigation”).

4. Attached hereto as Exhibit A is a true and correct copy of an affidavit of Ed

Magedson filed in the California Litigation on May 11, 2010.

5. Attached hereto as Exhibit B is a true and correct copy of an affidavit of Ed

Magedson filed in the California Litigation on May 24, 2010.

6. Attached hereto as Exhibit C are certain highlighted portions of the

deposition transcript of Iliana Llaneras.

7. Attached hereto as Exhibit D are certain highlighted portions of the

deposition transcript of Raymond Mobrez.

Pursuant to 28 U.S.C. § 1746, I declare under penalty of perjury under the laws of the

United States of America that the foregoing is true and correct.

EXECUTED ON: December 24, 2012.

GINGRAS LAW OFFICE, PLLC/S/ David S. GingrasDavid S. GingrasAttorney for Xcentric Ventures, LLC


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CERTIFICATE OF SERVICE

I hereby certify that on December 24, 2012 I electronically transmitted the attached

document to the Clerk’s Office using the CM/ECF System for filing, and for transmittal

of a Notice of Electronic Filing to the following:

John S. Craiger, Esq.David E. Funkhouser III, Esq.

Krystal M. Aspey, Esq.Quarles & Brady LLP

One Renaissance SquareTwo North Central Avenue

Phoenix, Arizona 85004-2391Attorney for Defendant Lisa J. Borodkin

Raymond MobrezIliana LlanerasPO BOX 3663

Santa Monica, CA 90408Defendants Pro Se

And a courtesy copy of the foregoing delivered to:HONORABLE G. MURRAY SNOW

United States District CourtSandra Day O’Connor U.S. Courthouse, Suite 622

401 West Washington Street, SPC 80Phoenix, AZ 85003-215

/s/David S. Gingras


Exhibit A


AFFIDAVIT OF ED MAGEDSON

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David S. Gingras, CSB #218793 Gingras Law Office, PLLC 4072 E Mountain Vista Dr. Phoenix, AZ 85048 Tel.: (480) 639-4996 Fax: (480) 668-3623 [email protected] Attorneys for Defendants Xcentric Ventures, LLC and Edward Magedson


CENTRAL DISTRICT OF CALIFORNIA ASIA ECONOMIC INSTITUTE, LLC, et al.,

Plaintiffs,

vs.

XCENTRIC VENTURES, LLC, et al., Defendants.

Case No: 2:10-cv-01360-SVW-PJW


I, Edward Magedson, declare as follows:

1. My name is Ed Magedson. I am a United States citizen, a resident of the

State of Arizona, am over the age of 18 years, and if called to testify in court or other

proceeding I could and would give the following testimony which is based upon my own

personal knowledge unless otherwise stated.

CORRECTION OF STATEMENTS

ABOUT THREATS FROM MR. MOBREZ

2. On March 22, 2010, I filed an Affidavit in this matter entitled “Affidavit of

Ed Magedson In Support of Defendants’ Special Motion to Strike” (the “March 22

Affidavit”) which covered numerous topics. Among other things, one of the topics that I

covered in the March 22 Affidavit was a series of telephone conversations I had with

Raymond Mobrez which took place in April and May 2009. At the time, I did not know

Mr. Mobrez, but I am now aware that he is one of the plaintiffs in this case.


2 AFFIDAVIT OF ED MAGEDSON

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3. In paragraph 31 of the March 22 Affidavit, I testified among other things:

“During my phone conversations with Mr. Mobrez, he became very threatening towards

me, stating that he ‘had people in Arizona’ who could ‘find me’ which I interpreted as a

threat.” I repeated this same statement in another short affidavit filed in this matter on

April 5, 2010. At the time I made the allegations regarding Mr. Mobrez threatening me,

I believed those statements to be true.

4. As I explained in ¶ 4 of my April 5, 2010 Affidavit, I have received many

threats in the past. Many of these past threats have included statements similar to those

which I attributed to Mr. Mobrez – people sometimes state that they are going to try to

find me or my home which is a very serious safety concern to me.

5. I believed that Mr. Mobrez was one of the people who threatened me

because my email to Mr. Mobrez on July 24, 2009 said that I lived in California (which

was not true). I concluded that I probably made that statement to Mr. Mobrez in

response to a statement from him which threatened to find me in Arizona, or to have

someone else do so. This is why I thought that Mr. Mobrez made such threats.

6. After these affidavits were filed, I recalled that I had recordings of all of

my telephone conversations with Mr. Mobrez which had taken place approximately a

year earlier. I had not yet retrieved or listened to any of these recordings before my

affidavits were filed with the court.

7. At the request of my attorneys following the Court’s denial of our anti-

SLAPP motion on April 19, 2010, on April 20, 2010 I spent several hours conducting a

search of my records. I was able to eventually locate six recordings of calls and/or

voicemails from Raymond Mobrez to the main number for the Ripoff Report site; (602)

359-4357. The first time I listened to any of these recordings was on April 20, 2010. I

also provided copies of these calls to my counsel for the first time on that same day.

8. After listening to each of these recordings, I was surprised to find that they

do not contain any threats from Mr. Mobrez as outlined in my March 22 or April 5

Affidavits.



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9. Having reviewed the recordings, I believe that I was mistaken when I

testified in my affidavits that Mr. Mobrez made such threats towards me. I must have

confused Mr. Mobrez with someone else.

10. Upon reviewing the six recordings of the calls/voicemails from Mr.

Mobrez which took place approximately a year ago, I realize now that I may not have

accurately recalled the substance of those calls. These recordings do not contain any

threats by Mr. Mobrez to locate me in Arizona and to the extent that my previous

affidavits stated that such a threat occurred during those calls, I must have been

mistaken.

RESPONSE TO ALLEGATIONS OF EXTORTION

11. I have reviewed the Declarations of Raymond Mobrez and Iliana Llaneras

filed in this case on May 3, 2010. I am aware from reviewing these declarations that Mr.

Mobrez claims that in a telephone conversation that took place on May 5, 200, I asked

him for a payment of $5,000 plus a monthly monitoring fee in order to help remedy

negative postings about AEI on the Ripoff Report site. I am aware that Mr. Mobrez

claims that during other calls, I told him that if he paid this fee, all of the negative would

be changed into a positive. I am also aware that Mr. Mobrez claims that I bragged

about Ripoff Report being at the top of all of the search engines, that any lawsuit against

us would be fruitless, and that it was therefore best for him to just “go with the [CAP]

program.” I understand that Ms. Llaneras claims to have been listening in to several of

these calls without my knowledge, and I am aware that she testified in her declaration

that Mr. Mobrez had accurately recounted each of these conversations in his declaration.

12. I am aware that at the time their declarations were filed on May 3, 2010,

Mr. Mobrez and Ms. Llaneras did not know that these calls had been recorded. I am

also aware that the existence of these recordings was revealed to Mr. Mobrez and Ms.

Llaneras for the first time during the deposition of Mr. Mobrez on May 7, 2010.

13. The six audio recordings that were played during the deposition of Mr.

Mobrez were true, complete, and unaltered copies of recordings which Xcentric



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automatically creates and routinely maintains as part of its business records. I did not

alter, edit, or modify these recordings in any way.

14. As clearly demonstrated in these recordings, none of Mr. Mobrez’s

allegations are true. Although I did have four telephone conversations with Mr. Mobrez

in April and May 2009 (all of which were initiated by him; I never called him), I never

asked Mr. Mobrez for money, I never asked Mr. Mobrez whether his company was

profitable or how it made money, I never told him that payment of a fee to Xcentric

would result in negative information being changed into a positive, and I never bragged

about Ripoff Report being at the top of any search engines. Excluding general

comments which are found on the Ripoff Report website here:

http://www.ripoffreport.com/ConsumersSayThankYou/WantToSueRipoffReport.aspx, I

never personally told Mr. Mobrez that Ripoff Report was immune under the law, I never

told him that a lawsuit against us was likely to fail, I never bragged about having a team

of lawyers who would fight him, and I never told him that it was “best to just join the

[CAP] program.” All of these allegations are blatant lies—they are pure fabrications

that Mr. Mobrez created in order to falsely malign me and the Ripoff Report site and to

gain unjustified sympathy for himself.

15. Rather, as the recordings of these phone calls clearly show, the topic of the

Corporate Advocacy Program was first brought up by Mr. Mobrez, not by me. In fact,

each time he called, Mr. Mobrez repeatedly tried to engage me in conversation about the

Corporate Advocacy Program and each time he did so, I refused to discuss the program

with him. Listening to these recordings now, I believe it is very clear that Mr. Mobrez

was attempting to lead me into asking for money from him, but I firmly refused to do so.

16. As a matter of general policy and in order to preempt exactly the type of

false and fabricated allegations present in this case, I do not discuss the Corporate

Advocacy Program by telephone with anyone unless and until they have contacted us in

writing to apply for the program. Because Mr. Mobrez never applied for the program, I

did not speak to him about it even though he repeatedly asked me to do so.



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17. As I explained to Mr. Mobrez several times, I will not to speak to anyone

about the CAP program by telephone unless they first fill out a form about their

company. Only after a company fills out the form will I agree to discuss any specific

details of the CAP program by phone. Because Mr. Mobrez never did this, I did not and

would not discuss the program with him in any detail.

18. In the case of AEI and Mr. Mobrez and as clearly demonstrated by the

recordings of the phone conversations between us, I never discussed any aspect of the

program with Mr. Mobrez by telephone except for explaining that if Mr. Mobrez wanted

to receive more information, he would need to review the page about the program

contained on our website and then complete a short application form which is available

here: http://www.ripoffreport.com/CorporateAdvocacy/Application.aspx.

19. As shown on the recordings, Mr. Mobrez initially indicated or implied that

he would go to the site and complete this application, but he never did so. During my

subsequent conversations with Mr. Mobrez in which he attempted to engage me in

discussions about the Corporate Advocacy Program, I repeatedly told him that “there is

nothing we can discuss by phone until I receive your information via email”. This

statement (which was made to Mr. Mobrez numerous times) was a reference to my

policy against discussing the CAP program by phone, and the email I was referring to is

the email generated by our system each time a person completes the CAP application

form.

20. I am aware that in ¶ 13 of his May 3, 2010 declaration, Mr. Mobrez claims

that a discussion took place between us at around 1:05 PM on May 5, 2009 in which he

claims that I demanded a payment of at least “five grand” ($5,000) plus a monthly

monitoring fee to enroll Mr. Mobrez in the Corporate Advocacy Program. I understand

that Mr. Mobrez’s wife, Iliana Llaneras, claims in her declaration that she was

eavesdropping on this call and that she confirms Mr. Mobrez’s version of what was said.

21. Both Mr. Mobrez and Ms. Llaneras are lying about the conversation that

took place on May 5, 2009. This call was automatically recorded by Xcentric and the



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actual recording of the call (which has a total running time of 35 seconds) was played

during the deposition of Mr. Mobrez. As clearly shown in the recording of this call, my

actual conversation with Mr. Mobrez during this call lasted approximately 13 seconds.

After Mr. Mobrez began speaking and I recognized his voice, I immediately hung up the

phone. Mr. Mobrez continued speaking for a few seconds until he realized that the call

had been disconnected. The remainder of the recording shows Mr. Mobrez repeatedly

saying, “Hello? Hello? Hello?” As the recording clearly shows, I never demanded

$5,000 (or any other amount) during this call, nor did I ever ask Mr. Mobrez for any

money at any time. In addition, I never made any of the other statements that Mr.

Mobrez attributed to me during this call such as informing him that the more money a

company made, the more I would charge that company for membership in the CAP

program. These statements are simply inflammatory, malicious and offensive lies that

Mr. Mobrez and Ms. Llaneras created in order to defame, discredit, and attack me.

22. I understand that according to the phone bills produced by Mr. Mobrez, his

bill reflects that the total duration of the call on May 5, 2009 at 1:05 PM was 2.2 minutes

which is obviously longer than the 35 seconds of audio recording that were actually

captured. The reason for this difference (which is present in each of the six recordings)

is that when a person calls the main phone number for the Ripoff Report site (602-359-

4357), they are not connected directly to me. Rather, callers are required to navigate

through a series of phone menus where they must listen to numerous choices and then

select which option they want.

23. In order to reach me directly, a caller is required to listen to two different

series of options and then push two different keys to indicate that they would like to

speak to the Ripoff Report’s editor. Listening to only the main menu of options takes 40

seconds. If the caller chooses option 1, which relates to requests to remove reports, they

get a recorded message regarding our policy, including the policy to not speak by

telephone. It takes one minute and thirty seconds to listen to the main menu plus the

recorded message in option 1.



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24. If the caller follows the phone tree to reach me, the phone system then asks

the caller to state their name which is recorded, and then they are placed on hold while

the system forwards the call to me. The automatic recording process does not begin

unless and until the caller is connected directly to me, and the audio recording only

captures what was said after the call is connected to me. So, for instance, if a person

spent 1 ½ minutes navigating through the phone menu system and waiting for the system

to connect the call and then spoke to me for a total of 30 seconds, Xcentric’s system

would only record the actual length of the conversation (30 seconds), but the caller’s

phone bill would likely indicate a total call duration of around 2.0 minutes.

25. Although a person could reach me in under a minute if they knew the exact

sequence of buttons to push and did not wait to hear each menu listing, normally

completing each step of the phone menu process takes anywhere from approximately

one minute to nearly two minutes. It is my belief that the time it takes to complete this

process is why Mr. Mobrez’s phone bills show that each call was approximately 90

seconds longer than the audio recording that was captured for each call.

26. To be clear—I did not delete any audio from these recordings nor did I edit

them in any way whatsoever. The recordings that have been supplied to Mr. Mobrez’s

attorneys are a complete and accurate reflection of the recordings made by Xcentric’s

system.

27. The first call was made by Mr. Mobrez on April 27, 2009 at 3:21 PM and

his phone bill shows the total length of the call was 3.5 minutes. According to

Xcentric’s recording of this call, the total amount of audio captured was 1:35 (one

minute, thirty-five seconds), but it is obvious from the recording itself that the entire

conversation was actually recorded. This implies that it took Mr. Mobrez about two

minutes to navigate through the menu system during this first call.

28. The second call from Mr. Mobrez was on April 27, 2009 at 3:27 PM. His

telephone bill shows the total length of this call was 1.0 minute. Xcentric’s system did

not record any audio from this call which I believe is due to the fact that the call was



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either dropped for some reason, or Mr. Mobrez hung up before he completed the phone

menu process. Because Mr. Mobrez never spoke to me during this call, no recording

was made.

29. The third call from Mr. Mobrez took place on April 27, 2009 at 3:28 PM.

His telephone bill shows that the total length of this call was 2.9 minutes. According to

¶ 8 of Mr. Mobrez’s May 3, 2010 declaration, he claims that this third call involved a

conversation between he and I in which I talked to him about the CAP program. That

statement is false. According to Xcentric’s recordings, this third call was actually a

voicemail that Mr. Mobrez left on our phone system. The total duration of this

voicemail was 1:20 (one minute, twenty seconds) which again is consistent with the

amount of time that Mr. Mobrez would spent navigating through Xcentric’s phone menu

system before he could leave a message for me.

30. During my final telephone conversation with Mr. Mobrez on May 12, 2009

and as clearly shown in the recording of that call, I told him as I had in previous

conversations that I needed to receive his email before I could engage in any further

discussions with him. At some point during that call, Mr. Mobrez became frustrated and

he told me that he had previously emailed me which I understood to mean that he had

previously completed the CAP application form.

31. As clearly shown in the recording of this call, Mr. Mobrez also continued

trying to “bait” me into asking him for money, which again I refused to do. In fact, at

one point during the call, Mr. Mobrez apparently became frustrated that I had not asked

him for money, and he said to me, “Look, if you want to fix this, we can take care of it

right away...” suggesting that if I would just request money from him, he was willing to

pay immediately. As was true of every other instance that Mr. Mobrez tried to make me

ask him for money, I refused to do so.

32. Instead, I responded by telling Mr. Mobrez that I would search for his

email to confirm that I had received his application form, but after several minutes of

searching I was not able to locate any such emails from him. I then repeated my



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previous statements to the effect that I would not and could not discuss the program with

him until I could confirm receipt of his application.

33. After our call ended on May 12, 2009, I continued looking for the CAP

application form which I thought Mr. Mobrez said he had sent. Eventually, I was able to

determine that Mr. Mobrez had never sent me any such form, and I therefore sent him an

email in which I expressed my frustration at having spent time looking for something

that did not exist.

34. When I told Mr. Mobrez that he “drove me crazy,” in my email to

following our discussion on May 12, 2009, I was not angry that he had not applied for

the CAP program. Rather, this statement was simply a reference to the fact that I was

frustrated that I had spent so much time looking for an email that Mr. Mobrez suggested

he had already sent when, in truth, the email had not been sent.

35. Based on my review of the declarations filed by Mr. Mobrez and his wife

Ms. Lllaneras, based on a review of the recordings of every telephone call described in

those declarations, based on my practice of refusing to have conversations about CAP

before an application is submitted, and based on my own personal memory and

recollection of these conversations, it is clear that Mr. Mobrez has lied about every

material aspect of our communications.



EXECUTED ON: May 11, 2010. ______________________________________

Edward Magedson



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I hereby certify that on May 11, 2010 I electronically transmitted the attached document

to the Clerk’s Office using the CM/ECF System for filing, and for transmittal of a Notice

of Electronic Filing to the following CM/ECF registrants:

Mr. Daniel F. Blackert, Esq. Asia Economic Institute

11766 Wilshire Blvd., Suite 260 Los Angeles, CA 90025 Attorneys for Plaintiffs

And a courtesy copy of the foregoing delivered to: Honorable Stephen V. Wilson

U.S. District Judge /s/David S. Gingras


Exhibit B


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David S. Gingras, CSB #218793 Gingras Law Office, PLLC 4072 E Mountain Vista Dr. Phoenix, AZ 85048 Tel.: (480) 639-4996 Fax: (480) 668-3623 [email protected] Maria Crimi Speth, (Admitted Pro Hac Vice) Jaburg & Wilk, P.C. 3200 N. Central Ave., Suite 2000 Phoenix, AZ 85012 Tel: (602) 248-1000 Fax: (602) 248-0522 [email protected] Paul S. Berra, CSB #186675 Law Offices of Paul S. Berra 1404 3rd Street Promenade, Suite 205 Santa Monica, CA 90401 Tel: (310) 394-9700 Fax: (310) 394-9755 [email protected] Attorneys for Defendants Xcentric Ventures, LLC and Edward Magedson


CENTRAL DISTRICT OF CALIFORNIA

ASIA ECONOMIC INSTITUTE, LLC, et al.,

Plaintiffs,

vs.

XCENTRIC VENTURES, LLC, et al., Defendants.

Case No: 2:10-cv-01360-SVW-PJW


IN SUPPORT OF

DEFENDANTS’ MOTION FOR

SUMMARY JUDGMENT

Hearing Date: June 28, 2010 Time: 1:30 PM Courtroom: 6 (Hon. Stephen Wilson)



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I, Edward Magedson, declare as follows:

1. My name is Ed Magedson. I am a resident of the State of Arizona, am over

the age of 18 years, and if called to testify in court or other proceeding I could and would

give the following testimony which is based upon my own personal knowledge unless

otherwise stated.

2. I am the manager of Xcentric Ventures, LLC (“Xcentric”) and the founder

and “ED”itor of the website www.RipoffReport.com which I started in 1998. The Ripoff

Report site is operated by Xcentric. Serving as a forum for speech concerning bad

business practices among other things, the Ripoff Report is the leading complaint

reporting website and is one of the most ardent supporters of free speech anywhere.

3. In my capacity as the Editor of the Ripoff Report I have worked closely

with all levels of federal, state, and local law enforcement, including, but not limited to,

various state attorneys general, county attorneys, Homeland Security, the United States

Justice Department, United States Secret Service, FBI, FTC, SEC, US Postal inspectors,

and local police, providing them with information used to locate victims, detect patterns

of deceptive business practices and to prosecute violations of consumer protection laws,

among other things.

4. The Ripoff Report is 100% free to use—it charges nothing whatsoever to

users who create reports, nothing to viewers who read reports, and nothing to anyone

wishing to respond to reports.

SUMMARY OF THE CORPORATE ADVOCACY PROGRAM

5. I have personally reviewed the Complaint filed against me in this matter by

Plaintiffs Asia Economic Institute, Raymond Mobrez and Iliana Llaneras. Based on this

review, I understand that a large portion of this action is founded upon Plaintiffs’

misunderstanding of the Ripoff Report’s Corporate Advocacy Program or “CAP”.

Because an accurate understanding of the CAP program is essential to understanding why

Plaintiffs’ allegations of “extortion” are groundless, I will briefly explain the program

before addressing the specific details of Plaintiffs’ Complaint.



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6. First of all, it is false to imply that the Ripoff Report is an “extortion”

scheme in which reports are solicited for the purpose of victimizing and extracting money

from those named in a report. If a company or individual is named in a report which

appears on the Ripoff Report, they always have the option of creating and posting a

response (called a “rebuttal”) which explains their side of the story. Ripoff Report

charges nothing whatsoever to anyone who wishes to post a rebuttal; they are 100% free.

7. When I am contacted by anyone who states that they have been targeted by

a false or inaccurate report, my first suggestion to them is to file a free rebuttal. In my

experience, the vast majority of complaints regarding unfair reports can be quickly and

inexpensively resolved by posting a well-written rebuttal.

8. As I stated above, I always recommend that companies file a rebuttal as

their primary recourse against any report they feel is inaccurate. However, in some

instances, companies may feel that additional assistance is needed in order to help them

improve customer satisfaction and resolve pending complaints. This is where the

Corporate Advocacy Program comes in.

9. When a company becomes a member of the CAP program, several different

elements are involved. First, the goal of the program is to ensure that complaints

submitted by unhappy customers are resolved and that the root problems which caused

these complaints are fixed so that future complaints can be reduced or avoided.

10. To achieve these goals, a company who joins the CAP program must agree,

in writing, to work with Ripoff Report and the unhappy customers who have filed reports

in order to resolve their complaints. This must include offering full refunds if requested

by the customer.

11. During this process, Ripoff Report acts as a liaison between the CAP

member and its customers by contacting each author who has submitted a report to our

site about the company. The email we send to each author explains that the company has

joined our program and has made a commitment to resolve the customer’s complaint

quickly and fairly.



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12. Regardless of the resolution of each specific complaint, when a company

joins the CAP program I will post information explaining this fact as an introduction to

each complaint about the company on the Ripoff Report site. The purpose of this is to

allow readers to see that the CAP member has joined our program and that the company

has made a firm commitment to increasing its customer satisfaction by working with

Ripoff Report to resolve all past and any future complaints.

13. CAP membership never includes the removal of reports, nor is the text of

existing reports changed in any way. The only alteration made is to add an introduction

to each report explaining that the company has joined our program, and this change is

made only after the company has consented in writing to permit Ripoff Report to make

the change. Other than adding this new information, existing reports remain visible on

the site in their exact original form.

14. I frequently explain to people that one of the benefits of joining the CAP

program is that they can “turn a negative into a positive”. When I say this, it is not meant

to imply that by joining the program, the text of existing complaints will be changed or

that negative statements will be changed. Rather, what I mean when I say this is that

people who visit the Ripoff Report understand that when a company joins the CAP

program, that company has made a visible, tangible commitment to increasing customer

satisfaction. As such, when someone reviews a report about a CAP member, in addition

to seeing the original complaint, they will also see that the company has joined our

program and this will cause the reader (assuming they are a potential customer) to realize

that the company can be trusted with their business. Because I strongly believe that

customers prefer to do business with a company that has shown a willingness to admit

their mistakes and to fix them, I feel that even negative complaints will produce a

positive effect for our CAP members in the long run.

15. Because the purpose of the CAP program is to help increase customer

satisfaction, I generally require companies to accept some level of responsibility for

customer complaints even if they do not agree with them. I do this because I do not want



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a company to participate in the program half-heartedly without having made a sincere

commitment to improving customer relations. If a company thinks they can simply join

the CAP program and expect to receive no additional complaints in the future without

making any changes to their practices, I would not be interested in having this company

as a member in our program.

16. I do not perform any kind of active marketing for the CAP program other

than providing general information about the program on the Ripoff Report website here:

http://www.ripoffreport.com/CorporateAdvocacy.aspx. I also include a few comments

about this program as well as a link to the above page in a standard form email that I send

in response to anyone who contacts the site asking about how to resolve a report.

17. In my standard email (a copy of which is attached as an exhibit to the

Plaintiffs’ Complaint), I also encourage the recipient to file a free rebuttal as their first

course of action. Specifically, my email states: “You can simply file a rebuttal and

explain your side of the story … it’s free … and you don’t have to even read any further,

just log on and file a rebuttal telling your side of the story, best not to be combative or

insulting.” This point is repeated several times throughout the email.

18. Nothing in my email demands money to change or remove reports. In fact,

my email clearly explains that we will NEVER remove reports in exchange for money: [A]s a matter of policy, we do not remove a submitted Rip-off Report, and we never will. Some people claim that we remove reports for money, but that is just plain false. We have been offered as much as $50,000 to remove just one Rip-off Report, but we declined because doing so is in violation of our policy, and more importantly, goes against what we what we stand for ... Please understand our position.

SUMMARY OF CONTACT WITH PLAINTIFFS

19. I understand from reviewing the Complaint and the declarations filed by

Plaintiffs in this matter that Plaintiffs have accused me of attempting to “extort” money

from them during a series of telephone calls that took place in late April and early May

2009. This allegation is completely and totally false. In fact, each and every one of my

telephone conversations with Mr. Mobrez was automatically recorded by Xcentric’s



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phone system and these recordings prove conclusively that Mr. Mobrez and Ms. Llaneras

have perjured themselves in this case.

20. I understand that Mr. Mobrez alleges that on February 15, 2009, he sent an

email to [email protected] which asked us to remove a report about him from our

site. Although I do have access to the email address [email protected], it is not my

primary email address; my primary email is [email protected]. I have no specific

recollection of receiving the February 15, 2009 email from Mr. Mobrez, and I am fairly

certain that I never responded to it. It is also possible that due to problems with

Xcentric’s email server, this email may never have arrived.

21. I understand that Mr. Mobrez alleges that on April 28, 2009, he sent me an

email which began “Dear Editor, I spoke with someone at your office yesterday … .”

Although I have seen this email during the course of this lawsuit, I do not specifically

recall receiving it at the time, and I am fairly certain that I never responded to it.

22. On May 5, 2009, Mr. Mobrez re-sent me a copy of the email he previously

sent on April 28, 2009 which also began “Dear Editor, I spoke with someone at your

office yesterday … .” I do recall receiving this email on May 5, 2009, and consistent

with my normal practice, I briefly reviewed it and then I responded later that same day

with a lengthy “form email” which I normally send to people who email me asking about

their options for responding to a report. The “form email” I sent to Mr. Mobrez on May

5, 2009 does not demand money and does not contain any threats; it simply explains my

views on various options for anyone wishing to address a report on our site.

23. I have reviewed the Declarations of Raymond Mobrez and Iliana Llaneras

filed in this case on May 3, 2010. I am aware from reviewing these declarations that Mr.

Mobrez claims that in a telephone conversation that took place on May 5, 2009, I asked

him for a payment of $5,000 plus a monthly monitoring fee in order to help remedy

negative postings about AEI on the Ripoff Report site. I am aware that Mr. Mobrez

claims that during other calls, I told him that if he paid this fee, all of the negative would

be changed into a positive. I am also aware that Mr. Mobrez claims that I bragged about



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Ripoff Report being at the top of all of the search engines, that any lawsuit against us

would be fruitless, and that it was therefore best for him to just “go with the [CAP]

program.” I understand that Ms. Llaneras claims to have been listening in to several of

these calls without my knowledge, and I am aware that she testified in her declaration

that Mr. Mobrez had accurately recounted each of these conversations in his declaration.

24. I am aware that at the time their declarations were filed on May 3, 2010,

Mr. Mobrez and Ms. Llaneras did not know that these calls had been recorded. I am also

aware that the existence of these recordings was revealed to Mr. Mobrez and Ms.

Llaneras for the first time during the deposition of Mr. Mobrez on May 7, 2010.

25. The six audio recordings that were played during the deposition of Mr.

Mobrez on May 7, 2010 were true, complete, and unaltered copies of recordings which

Xcentric automatically creates and routinely maintains as part of its business records. I

did not alter, edit, or modify these recordings in any way.

26. After the denial of Defendants’ anti-SLAPP motion on April 19, 2010, the

following day (on April 20, 2010) I began a search for any audio recordings that might

exist of conversations between Mr. Mobrez and myself. Because of the significant

amount of time involved, I did not conduct a search for these recordings prior to April 19,

2010 because I believed the anti-SLAPP motion was likely to succeed, and until it was

denied, I did not know whether any phone conversations between me and Mr. Mobrez

would be necessary or relevant to the case.

27. As of April 20, 2010, I did not know exactly when Mr. Mobrez alleged that

he had spoken to me and I did not know what phone number(s) he was calling from. For

that reason, in order to locate any and all possible calls from Mr. Mobrez, I had to review

recordings of every call made to the Ripoff Report’s main telephone number (602) 359-

4357 over a period spanning several months. This search took me about 4–5 hours.

28. Following my search, I was able to locate recordings of six phone calls

from Mr. Mobrez to the Ripoff Report’s main number. All of these calls occurred in

April and May 2009.



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29. Xcentric employs the services of a third-party vendor who automatically

records all telephone calls to Ripoff Report’s main phone number; (602) 359-4357.

These recordings occur off-site, and I do not have access to any of the equipment used to

record the calls nor do I have access to the recordings until they are sent to me via email.

30. When a call is recorded, the third-party vendor’s system emails me an

audio file which contains a copy of the call. This audio file includes certain data about

the call in the file’s header such as information from the caller ID, the number the caller

is calling from, the date of the call and the time the recording ended.

31. According to my search, Xcentric’s phone system recorded six phone calls

from Mr. Mobrez in April and May 2009. These calls are summarized in the table

below. It should be noted that the table actually reflects a total of seven calls were made

even though only six calls were recorded.

32. The only call not recorded—Call #2 in this table—was a call made from

Mr. Mobrez’s office phone to the Ripoff Report on April 27, 2009. According to phone

records produced by Mr. Mobrez which I have reviewed, I am aware that Call #2 was

made at 3:27 PM on April 27, 2009, but the duration of the call as reflected on the phone

bill was only 1.0 minute. It is my belief that no recording of this call was made because

Mr. Mobrez never actually spoke to me during Call #2; this call was either dropped, did

not connect successfully, or Mr. Mobrez hung up before reaching me.

TABLE OF RECORDINGS Call

#

Date End

Time

Call

From #

Length

Min:Sec

1 4/27/2009 3:25 PM (310) 806-3000 1:35

2 4/27/2009 N/A N/A N/A

3 4/27/2009 3:32 PM (310) 806-3000 1:20

4 5/5/2009 11:33 AM (310) 806-3000 0:51

5 5/5/2009 1:10 PM (310) 806-3000 0:35

6 5/9/2009 1:38 PM (310) 801-5161 1:36

7 5/12/2009 3:05 PM (310) 806-3000 14:45



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33. In order to reach me directly, a caller is required to listen to two different

series of options and then push two different keys to indicate that they would like to

speak to the Ripoff Report’s editor. Listening to only the main menu of options takes 40

seconds. If the caller chooses option 1, which relates to requests to remove reports, they

get a recorded message regarding our policy, including the policy to not speak by

telephone. It takes one minute and thirty seconds to listen to the main menu plus the

recorded message in option 1.

34. If the caller follows the phone tree to reach me, the phone system then asks

the caller to state their name which is recorded, and then they are placed on hold while

the system forwards the call to me. The automatic recording process does not begin

unless and until the caller is connected directly to me, and the audio recording only

captures what was said after the call is connected to me. So, for instance, if a person

spent 1 ½ minutes navigating through the phone menu system and waiting for the system

to connect the call and then spoke to me for a total of 30 seconds, Xcentric’s system

would only record the actual length of the conversation (30 seconds), but the caller’s

phone bill would likely indicate a total call duration of around 2.0 minutes.

35. Although a person could reach me in under a minute if they knew the exact

sequence of buttons to push and did not wait to hear each menu listing, normally

completing each step of the phone menu process takes anywhere from approximately one

minute to nearly two minutes. It is my belief that the time it takes to complete this

process is why Mr. Mobrez’s phone bills show that each call was approximately 90

seconds longer than the audio recording that was captured for each call.

36. To be clear—I did not delete any audio from these recordings nor did I edit

them in any way whatsoever. The recordings that have been supplied to Mr. Mobrez’s

attorneys are a complete and accurate reflection of the recordings made by Xcentric’s

system.

37. As clearly demonstrated in the recordings of the six other calls, none of Mr.

Mobrez’s extortion allegations are true. Of these six calls, two of them were voicemails



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that Mr. Mobrez left for me and the other four are recordings of our actual conversations.

Although I did have four brief telephone conversations with Mr. Mobrez in April and

May 2009 (all of which were initiated by him; I never called him), I never asked Mr.

Mobrez for money, I never asked Mr. Mobrez whether his company was profitable or

how it made money, I never told him that payment of a fee to Xcentric would result in

negative information being changed into a positive, and I never bragged about Ripoff

Report being at the top of any search engines. All of these allegations are lies.

Excluding general comments which are found on the Ripoff Report website here:

http://www.ripoffreport.com/ConsumersSayThankYou/WantToSueRipoffReport.aspx, I

never personally told Mr. Mobrez that Ripoff Report was immune under the law, I never

told him that a lawsuit against us was likely to fail, I never bragged about having a team

of lawyers who would fight him, and I never told him that it was “best to just join the

[CAP] program.” All of these allegations are blatant lies—they are pure fabrications that

Mr. Mobrez created in order to falsely malign me and the Ripoff Report site and to gain

unjustified sympathy for himself.

38. Rather, as the recordings of these phone calls clearly show, the topic of the

Corporate Advocacy Program was first brought up by Mr. Mobrez, not by me. In fact,

each time he called, Mr. Mobrez repeatedly tried to engage me in conversation about the

Corporate Advocacy Program and each time he did so, I refused to discuss the program

with him. Listening to these recordings now, I believe it is very clear that Mr. Mobrez

was attempting to lead me into asking for money from him, but I firmly refused to do so.

39. As a matter of general policy and in order to preempt exactly the type of

false and fabricated allegations present in this case, I do not discuss the Corporate

Advocacy Program by telephone with anyone unless and until they have contacted us in

writing to apply for the program. Because Mr. Mobrez never applied for the program, I

did not speak to him about it even though he repeatedly asked me to do so.

40. In the case of AEI and Mr. Mobrez and as clearly demonstrated by the

recordings of the phone conversations between us, I never discussed any aspect of the



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program with Mr. Mobrez by telephone except for explaining that if Mr. Mobrez wanted

to receive more information, he would need to review the page about the program

contained on our website and then complete a short application form which is available

here: http://www.ripoffreport.com/CorporateAdvocacy/Application.aspx.

41. As shown on the recordings, Mr. Mobrez initially indicated or implied that

he would go to the site and complete this application, but he never did so. During my

subsequent conversations with Mr. Mobrez in which he attempted to engage me in

discussions about the Corporate Advocacy Program, I repeatedly told him that “there is

nothing we can discuss by phone until I receive your information via email”. This

statement (which was made to Mr. Mobrez numerous times) was a reference to my policy

against discussing the CAP program by phone, and the email I was referring to is the

email generated by our system each time a person completes the CAP application form.

42. I am aware that in ¶ 13 of his May 3, 2010 declaration, Mr. Mobrez claims

that a discussion took place between us at around 1:05 PM on May 5, 2009 in which he

claims that I demanded a payment of at least “five grand” ($5,000) plus a monthly

monitoring fee to enroll Mr. Mobrez in the Corporate Advocacy Program. I understand

that Mr. Mobrez’s wife, Iliana Llaneras, claims in her declaration that she was

eavesdropping on this call and that she confirms Mr. Mobrez’s version of what was said.

43. Both Mr. Mobrez and Ms. Llaneras are lying about the conversation that

took place on May 5, 2009. This call was automatically recorded by Xcentric and the

actual recording of the call (which has a total running time of 35 seconds) was played

during the deposition of Mr. Mobrez. As clearly shown in the recording of this call, my

actual conversation with Mr. Mobrez during this call lasted approximately 13 seconds.

After Mr. Mobrez began speaking and I recognized his voice, I immediately hung up the

phone. Mr. Mobrez continued speaking for a few seconds until he realized that the call

had been disconnected. The remainder of the recording shows Mr. Mobrez repeatedly

saying, “Hello? Hello? Hello?” As the recording clearly shows, I never demanded

$5,000 (or any other amount) during this call, nor did I ever ask Mr. Mobrez for any



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money at any time. In addition, I never made any of the other statements that Mr.

Mobrez attributed to me during this call such as informing him that the more money a

company made, the more I would charge that company for membership in the CAP

program. These statements are simply inflammatory, malicious and offensive lies that

Mr. Mobrez and Ms. Llaneras created in order to defame, discredit, and attack me.

44. I understand that according to the phone bills produced by Mr. Mobrez, his

bill reflects that the total duration of the call on May 5, 2009 at 1:05 PM was 2.2 minutes

which is obviously longer than the 35 seconds of audio recording that were actually

captured. The reason for this difference (which is present in each of the six recordings)

is that as explained above, anyone who calls the Ripoff Report main phone number must

navigate through a series of menus before they are connected to me. This process takes

an average of between one and two minutes which is why Mr. Mobrez’s phone bills show

that each call he made to the Ripoff Report was approximately 90 seconds longer than the

amount of audio actually recorded.

45. The first call was made by Mr. Mobrez on April 27, 2009 at 3:21 PM and

his phone bill shows the total length of the call was 3.5 minutes. According to Xcentric’s

recording of this call which was transcribed on pages 271:7–273:9 of Mr. Mobrez’s

deposition, the total amount of audio captured was 1:35 (one minute, thirty-five seconds),

but it is obvious from the recording itself that the entire conversation was actually

recorded. This implies that it took Mr. Mobrez about two minutes to navigate through

the menu system during this first call.

46. The second call from Mr. Mobrez was on April 27, 2009 at 3:27 PM. His

telephone bill shows the total length of this call was 1.0 minute. Xcentric’s system did

not record any audio from this call which I believe is due to the fact that the call was

either dropped for some reason, or Mr. Mobrez hung up before he completed the phone

menu process. Because Mr. Mobrez never spoke to me, no recording was made.

47. The third call from Mr. Mobrez took place on April 27, 2009 at 3:28 PM.

His telephone bill shows that the total length of this call was 2.9 minutes. According to



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¶ 8 of Mr. Mobrez’s May 3, 2010 declaration, he claims that this third call involved a

conversation between he and I in which I talked to him about the CAP program. That

statement is false. According to Xcentric’s recording of this case, which was transcribed

on pages 276:3–277:6 of Mr. Mobrez’s deposition, the third call was actually a voicemail

that Mr. Mobrez left on our phone system. The total duration of this voicemail was 1:20

(one minute, twenty seconds) which again is consistent with the amount of time that Mr.

Mobrez would have spent navigating through Xcentric’s phone menu system before he

could leave a message for me.

48. The fourth call from Mr. Mobrez took place on May 5, 2009 at 11:28 AM.

His telephone bill shows that the total length of this call was 2.6 minutes. According to ¶

10 of Mr. Mobrez’s May 3, 2010 declaration, he claims that during this fourth call, he

asked me for information about the CAP program, including the cost. Mr. Mobrez also

claimed that I told him during this call that the Ripoff Report had immunity under the law

and therefore could not be sued, and that we have a team of lawyers who would fight any

lawsuit and therefore it was best to “just go with the [CAP] program”. All of these

allegations are completely false. The actual recording of Call #4, which was transcribed

on pages 278:12–279:10 of Mr. Mobrez’s deposition, demonstrates that Mr. Mobrez

attempted to engage me in a discussion about how he could resolve a report on our site,

and I expressly told him that I could not speak to him about this by phone (as I had

previously told him during our first discussion). After explaining that I would not speak

to him by phone, I hung up and the recording ended. The total duration of the recording

was 51 seconds.

49. The fifth call from Mr. Mobrez took place on May 5, 2009 at 1:05 PM. His

telephone bill shows the length of this call was 2.2 minutes. This call is described in ¶

13 of Mr. Mobrez’s May 3, 2010 declaration, and this is the call during which Mr.

Mobrez claims that I demanded $5,000 from him, plus an additional payment of several

hundred dollars each month. These allegations are completely false. According to

Xcentric’s recording of this call, which was transcribed on pages 280:4–281:7 of Mr.



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Mobrez’s deposition, the entire conversation during Call #5 lasted a total of 35 seconds.

The call began with me asking the caller who he was, after which Mr. Mobrez responded:

“I spoke to you earlier. Thank you for sending me that e-mail. I tried to understand it,

but there’s nothing says what I can do there. Hello? Hello? Hello?” This represents the

entire conversation that occurred during Call #5.

50. As reflected in this recording, once again I hung up the phone on Mr.

Mobrez once I realized that it was the same person who had called me several times

before and who I had previously told I would not speak to by phone. As reflected in the

recording, I never asked Mr. Mobrez for money, never told him that our fees were based

on the size of his company, and never told him that the more money he made the more he

would be charged. All of these allegations are completely false as the tape recording of

this call clearly shows.

51. The sixth call from Mr. Mobrez took place on May 9, 2009 at 1:36 PM.

This call was another voicemail that Mr. Mobrez left from his cell phone (310-801-5161).

Mr. Mobrez did not produce a copy of his cell phone records despite being asked to do

so, so I do not know what the length of this call was according to his bill. According to

Xcentric’s recording of this call, which was transcribed on pages 282:10–283:20 of Mr.

Mobrez’s deposition, Mr. Mobrez accurately describes his previous conversations with me

as being very short and ending with me hanging up on him; “I spoken about three times

with the same gentleman, but it seemed to me he does not want to stay on the phone or

something. He just hangs up very quickly.”

52. The seventh and final call from Mr. Mobrez took place on May 12, 2009 at

2:46 PM. This call is described in ¶ 14 of Mr. Mobrez’s May 3, 2010 declaration in

which he states that I told him during the call that if he joined the CAP program and paid

the fees, then “all the negative goes away and you see the positive.” As reflected in the

transcript of the call, this allegation is completely false; I never told Mr. Mobrez during

this call that membership in the CAP program would make all the negative go away.



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Rather, as with every other call, I specifically told Mr. Mobrez during this call that I

would not and could not speak to him about CAP unless he applied for the program.

53. As clearly shown in the recording of this call, even after I told him that I

would not speak to him about the CAP program, Mr. Mobrez also continued trying to

“bait” me into asking him for money, which again I refused to do. In fact, at one point

during the call, Mr. Mobrez apparently became frustrated that I had not asked him for

money and he said to me, “Look, if you want to fix this, we can take care of it right

away...” suggesting that if I would just request money from him, he was willing to pay

immediately. As was true of every other instance that Mr. Mobrez tried to make me ask

him for money, I refused to do so.

54. Instead, I responded by telling Mr. Mobrez that I would search for his email

to confirm that I had received his application form, but after several minutes of searching

I was not able to locate any such emails from him. I then repeated my previous

statements to the effect that I would not and could not discuss the program with him until

I could confirm receipt of his application.

55. After our call ended on May 12, 2009, I continued looking for the CAP

application form which I thought Mr. Mobrez said he had sent. Eventually, I was able to

determine that Mr. Mobrez had never sent me any such form, and I therefore sent him an

email in which I expressed my frustration at having spent time looking for something that

did not exist.

56. Mr. Mobrez never completed the CAP application, never joined the CAP

program, and neither he nor Ms. Llaneras nor AEI have ever paid anything to me or to

Xcentric.

57. When I told Mr. Mobrez that he “drove me crazy,” in my email to

following our discussion on May 12, 2009, I was not angry that he had not applied for the

CAP program. Rather, this statement was simply a reference to the fact that I was

frustrated that I had spent so much time looking for an email that Mr. Mobrez suggested

he had already sent when, in truth, the email had not been sent.



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58. Based on my review of the Complaint and the exhibits thereto, I am aware

that there six reports which Plaintiffs allege contain various false statements about them.

These reports (as is true of all new submissions to our site) are automatically assigned

“report numbers” by our servers which are sequential numbers reflecting the order in

which each report was received.

59. In this case, I understand that the six postings at issue are as follows:

Report #417493, #423987, #457433, #502429, #564331, and #571232. I understand that

screenshots of portions of the report as well as copies of the text of each of each report

are attached to the Declaration of David Gingras submitted herewith as follows:

60. All of these reports and rebuttals were created by third parties, not by me or

Xcentric. I had nothing to do with the creation of the six reports at issue in this case, nor

did I have anything to do with the comments/rebuttals to each report. I did not create

these reports or rebuttals, nor did I alter them in any way. I did not “solicit” anyone else

to write these reports or rebuttals.

61. I am aware that on May 20, 2010, Mr. Mobrez filed a “corrected” affidavit

in this matter in which he attempted to recant much of his prior testimony. I am also

aware that in his “corrected” affidavit Mr. Mobrez testified, “In addition, there were a

number of incoming calls to me from Ripoff Report.” This statement is completely false

and is just another lie by Mr. Mobrez. At no time did I ever call Mr. Mobrez, nor would

Exhibit Report # Submission Date

1A/B 417493 January 28, 2009

2A/B 423987 February 13, 2009

3A/B 457433 June 1, 2009

4A/B 502429 September 30, 2009

5A/B 564331 February 3, 2010

6A/B 571232 February 19, 2010



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I have contacted him by phone for any reason. If I had wanted to contact him, I would

have done so in writing via email.

62. I have been the victim of many false allegations in the past by people

seeking to destroy the Ripoff Report. As a result, I am extremely cautious about who I

contact by phone. Although I do accept incoming calls to the Ripoff Report, all of these

calls are recorded in order to prevent people from lying about what was discussed.

However, because my outgoing calls are not recorded, it is never my practice to contact

anyone by phone regarding any aspect of the Ripoff Report site (including the Corporate

Advocacy Program) unless I have an established relationship with the person I am

calling. Because I had no relationship of any kind with Mr. Mobrez, I never contacted

him by phone nor would I have done so.

63. Xcentric does not now, nor has it ever, employed, authorized, or contracted

with anyone to sell or solicit the Corporate Advocacy Program. In addition, no employee

of Xcentric is authorized to call anyone regarding the removal of reports or regarding the

Corporate Advocacy Program. As the manager of Xcentric Ventures, I am the only

person authorized by Xcentric to engage in discussions about the CAP program with

potential members, and I am certain that I never had any discussions with Mr. Mobrez or

Ms. Llaneras about the CAP program other than the few emails and phone calls described

above.

64. At no time was I aware that AEI had valuable contracts and business

expectancies with its employees. As indicated above, I had never heard of Mr. Mobrez or

AEI prior to his emails to me in early 2009, and at no time during any of my limited

conversations with Mr. Mobrez did he mention anything about his employees, nor did he

tell me that employees had quit because of anything posted on the Ripoff Report site.

65. I am not in, nor have I ever entered into any conspiracy with anyone to

harm Plaintiffs. I do not know who posted the reports about Plaintiffs. Although

Xcentric maintains logs which would have information about the author(s) of each report,

I have not personally reviewed this information. I am certain, however, that other than



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Mr. Mobrez, I have never spoken to anyone about Mr. Mobrez or about AEI until this

lawsuit was filed in January 2010.



EXECUTED ON: May 24, 2010. ______________________________________

Edward Magedson



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I hereby certify that on May 24, 2010 I electronically transmitted the attached document

to the Clerk’s Office using the CM/ECF System for filing, and for transmittal of a Notice

of Electronic Filing to the following CM/ECF registrants:

Mr. Daniel F. Blackert, Esq. Ms. Lisa J. Borodkin, Esq. Asia Economic Institute

11766 Wilshire Blvd., Suite 260 Los Angeles, CA 90025 Attorneys for Plaintiffs

And a courtesy copy of the foregoing delivered to: Honorable Stephen V. Wilson

U.S. District Judge /s/David S. Gingras


Exhibit C


151 KALMUS DRIVE, SUITE L1 COSTA MESA, CA 92626

HAHN & BOWERSOCK 800-660-3187 FAX 714-662-1398


DISTRICT OF ARIZONA

Xcentric Ventures, LLC, an ) Case No.

Arizona limited liability ) 11-CV-1426-GMS

company, )

)

Plaintiff, )

)

v. )

)

Lisa Jean Borodkin, et al., )

)

Defendants. )

______________________________)

Raymond Mobrez, )

)

Counterclaimant, )

)

v. )

)

Xcentric Ventures, LLC, and )

Edward Magedson, )

)

Counterdefendants. )

)

______________________________)

VIDEOTAPED DEPOSITION OF ILIANA LLANERAS

Los Angeles, California

Tuesday, December 11, 2012

Reported by:

Carmen R. Sanchez

CSR No. 5060




2

1 UNITED STATES DISTRICT COURT2 DISTRICT OF ARIZONA3

4 Xcentric Ventures, LLC, an ) Case No. Arizona limited liability ) 11-CV-1426-GMS

5 company, ) )

6 Plaintiff, ) )

7 v. ) )

8 Lisa Jean Borodkin, et al., ) )

9 Defendants. ) ______________________________)

10 Raymond Mobrez, ) )

11 Counterclaimant, ) )

12 v. ) )

13 Xcentric Ventures, LLC, and ) Edward Magedson, )

14 ) Counterdefendants. )

15 ) ______________________________)

16

17 Videotaped deposition of ILIANA LLANERAS,18 taken on behalf of Plaintiff/Counterdefendant, at19 355 South Grand Avenue, Suite 2450, Los Angeles,20 California, beginning at 9:28 a.m. and ending at21 1:21 p.m., on Tuesday, December 11, 2012,22 before Carmen R. Sanchez, Certified Shorthand23 Reporter No. 5060.24

25

3

1 APPEARANCES:2 For Plaintiff/Counterdefendant Xcentric Ventures,

LLC:3

GINGRAS LAW OFFICE, PLLC4 BY: DAVID S. GINGRAS, ESQ.

3941 E. Chandler Boulevard5 Suite 106-243

Phoenix, Arizona 850486 Telephone: (480) 668-3623

Facsimile: (480) 248-31967 E-mail: [email protected] In Propria Persona:9 RAYMOND MOBREZ

P.O. Box 366310 Santa Monica, California 9040811 Also Present:12 David Bradley

Videographer13 Hahn & Bowersock Corporation14

15

16

17

18

19

20

21

22

23

24

25

26

4

1 I N D E X2 WITNESS3 ILIANA LLANERAS4 Examination by: Page5 MR. GINGRAS 86

7 E X H I B I T S8 Plaintiff's Page Page

Exhibit Description Introduced Marked9

Exhibit 1 Copy of Asia v.10 ROR - Original

CA Complaint 34 17711

Exhibit 2 Copy of a series12 of Ripoff Reports;

Nos. 417493,13 423987, 457433,

502429, 564331,14 and 571232 45 17715 Exhibit 3 Copy of Declaration

of Raymond Mobrez 63 17716

Exhibit 4 Copy of Declaration17 of Iliana Llaneras 67 17718 Exhibit 5 Copy of corrected

Affidavit of19 Iliana Llaneras 73 17720 Exhibit 6 Copy of corrected

Affidavit of21 Raymond Mobrez 74 17722

23

24 Continued ....25

5

1 I N D E X (CONTINUED)2

3 E X H I B I T S4 Plaintiff's Page Page

Exhibit Description Introduced Marked5

Exhibit 7 Copy of AEI6 Confidential

Settlement7 Conference

Statement 75 1778

Exhibit 8 Copy of Asia v.9 ROR - First

Amended Complaint 86 17710

Exhibit 9 Copy of an E-mail11 from Lisa Borodkin,

dated 7/15/201012 Re: Deposition 83 17713 Exhibit 10 Copy of an E-mail

from Lisa Borodkin,14 dated 7/15/2010

Re: AEI v. Xcentric:15 Laymen's Description

of theory of RICO16 Wire Fraud 84 17717 Exhibit 11 Copy of AEI

Rule 56(f)18 Motion 167 17719 Exhibit 12 Copy of Asia v.

ROR - Proposed20 Second Amended

Complaint 169 17721

Exhibit 13 Copy of Defendants'22 Discovery Responses 170 17723

24 Continued ....25




66

1 forward, are you saying that on May 5th, 2009,

2 there was a different conversation -- you heard --

3 you heard the recordings that I played during

4 Raymond's deposition; right?

5 A Yes.

6 Q Okay. And I have them again, and I

7 don't want to play them again.

8 Are you saying that on May 5th,

9 2009, there was a different conversation between

10 Mr. Mobrez and Mr. Magedson that you heard?

11 A I don't know if it was Mr. Magedson.

12 There were many calls that came in during that time

13 frame.

14 Q Okay.

15 Same question with regard to

16 paragraph 13. Raymond is again talking about later

17 that day, and he means -- I think he's referring to

18 May 5th, 2009. Paragraph 13 he says later that day

19 there was another conversation between Mr. Magedson

20 and Raymond; and at the end of the paragraph, he

21 says, "Again, Ms. Llaneras listened from her office

22 phone."

23 Is that accurate?

24 A I don't know. We're not sure. I'm

25 not sure. He's provided a corrected statement to

67

1 this.

2 Q Okay.3 Paragraph 14 on page 5, again,4 line 24, Raymond in his declaration says,5 "Ms. Llaneras witnessed this conversation from her6 office," and he's talking about a phone call that7 occurred on May 12th, 2009.8 Do you remember listening to -- and9 he describes it as being approximately 17 minutes,

10 which is roughly the length of the recording we11 have. It's slightly shorter.12 Do you recall listening to a roughly13 17-minute phone conversation on May 12th, 2009?14 A I'm not sure.

15 Q Okay.16 You submitted a declaration17 initially, which is Exhibit 4. Do you remember18 this?19 A Yes.

20 Q And in your declaration, you said,21 among other things, paragraph 4, you said that22 you've never spoken with Ed Magedson.23 (As read): "However, I24 witnessed the conversations that took25 place between Mr. Mobrez and Mr. Magedson

68

1 on May 5th and 12th, 2009."2 Was that statement true?3 A I had believed it was true at the

4 time that I made the statement.

5 Q Did something happen in the future6 that caused you to believe that wasn't true?7 A You played the tapes; and,

8 obviously, it was not that; so I had to present a

9 corrected statement.

10 Q Okay.11 Before we get to your corrected12 statement, look at Exhibit A to Exhibit 4.13 Exhibit A to your declaration. There are some14 notes there. Do you see them? They're very light,15 and I apologize.16 A Yes.

17 Q That's how I received them.18 A Yes.

19 Q Did you take these while you were20 listening to the phone calls on May 5th and21 May 12th?22 A No.

23 Q When did you take these notes?24 A These were reconstructed notes.

25 Q Okay.

69

1 On the second to the last page,2 there's kind of a header that the Court adds there,3 where it has the case number. Do you see that?4 A Right.

5 Q It says, "Page 7 of 8"; so we can6 use that to refer.7 A Yes.

8 Q This appears to say -- these appear9 to be notes that have a date, May 5th, 2009,

10 1:00 p.m. Do you see that?11 A Yes.

12 Q And there's a statement here that13 says -- or notation that appears to say, "5,000 +14 monthly," I think is what -- I think there's a15 darker version of this easier to read.16 Was that statement truthful in your17 notes that there was some mention of $5,000 and18 monthly on May 5th, 2009?19 A Based on my recollection at the

20 time.

21 Q Can you estimate when you22 reconstructed these notes?23 A Yes. We had our original notes in a

24 file, and we were ordered by the Court to provide a

25 declaration and to attach anything that -- that we


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70

1 had related to those conversations and -- and,

2 unfortunately, we had misplaced it; and we told our

3 attorney that we're trying to locate them, and he

4 says, "Well, we have to -- we have to oblige by the

5 time line; so at least reconstruct it. Go back to

6 your records, phone records, et cetera. We can

7 always -- as soon as you find them, you can always

8 submit them to the Court"; so these ....

9 Q Did Lisa -- Lisa Borodkin's name and10 bar number are on the first page of Exhibit 4 and11 Exhibit 3. Do you recall that she was involved in12 any way with drafting these or helping you prepare13 these?14 A No.

15 Q Who was involved in helping you16 prepare these?17 A Blackert.

18 Q Only?19 A Yes.

20 Q Okay. In your declaration, in21 paragraph 6, you say (as read):22 "Attached as EXHIBIT A is a23 true and correct copy of the handwritten24 notes I took during these conversations as25 they occurred."

71

1 Why didn't you say in that paragraph

2 that these notes were not true and accurate copies

3 of the notes you took while the conversations were

4 occurring?

5 A That was a typo.

6 Q That was a typo?

7 A That was a typo, and we didn't see

8 that until it came up.

9 Q You meant to say that they were

10 reconstructed?

11 A Reconstructed; correct. During the

12 rush, I didn't catch it. My attorney didn't catch

13 it; and, unfortunately, it was filed.

14 Q So when you -- do you remember

15 preparing this affidavit sometime around May 3rd of

16 2010?

17 A Our attorney prepared it; so ....

18 Q Okay. But did he talk to you before

19 he prepared it? How --

20 A Yes.

21 Q -- did he know what to say?

22 A Yes, he talked to me about it, yes.

23 Q Okay. So you told him the details

24 to include in here?

25 A Yes, we spoke about it. Well, he --

72

1 you know, we spoke about it and he prepared it.

2 Q Okay.3 One thing that I'm kind of focused4 on is during Raymond's deposition in 2010, I --5 obviously, I played the recordings for him, and I6 played the recording of the long call, which was7 the last one on May 12th, 2009. And during that8 call, you were in the room when it was played.9 During that call, according to the deposition

10 transcript -- and the court reporter was11 transcribing Raymond's conversation from the12 recording -- Raymond said -- and this is, again,13 this is May 12th, 2009. He said -- he's talking to14 Mr. Magedson, and he says (as read):15 "I went there, and it was a little16 bit confusing to me. It is also -- it17 doesn't say what the -- what do you call --18 the cost or something? It doesn't give19 me ...."20 And they're talking about the CAP21 program.22 Do you know why on May 12th, 2009,23 Raymond would have said to Mr. Magedson that he24 didn't know the cost of CAP, when you said on25 May 5th the amount was $5,000 that was discussed?

73

1 A No, I'm not sure.

2 Q You're not sure why?3 A No.

4 Q Because are your notes not accurate?5 A We're not sure if those discussions

6 were with Magedson or someone else of, you know,

7 Xcentric or Ripoff. We're not sure.

8 Q Okay. Well, let's look at your9 corrected declaration, then, Exhibit 5.

10 This is dated May 20th, 2010. And11 you remember signing this and filing it in the12 prior California case?13 A Yes.

14 Q Again, did Lisa Borodkin have any15 role in preparing this?16 A Blackert prepared it for us.

17 Q Okay.18 Based on your corrected declaration,19 I don't see anything in here that claims that20 Ed Magedson ever asked for money that you were21 aware of. Is that consistent with your memory?22 A I had to make the correction because

23 I wasn't sure who the person was. I wasn't sure if

24 it was Magedson or not.

25 Q Okay.


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Exhibit D


151 KALMUS DRIVE, SUITE L1 COSTA MESA, CA 92626HAHN & BOWERSOCK 800-660-3187 FAX 714-662-1398

1


CENTRAL DISTRICT OF CALIFORNIA

ASIA ECONOMIC INSTITUTE, LLC, )

et al., )

) Case No.:

Plaintiffs, ) 2:10-CV-01360-

) SVW-PJW

v. )

)

XCENTRIC VENTURES, LLC, et al., )

)

Defendants. )

___________________________________)

DEPOSITION OF RAYMOND MOBREZ

Los Angeles, California

May 7, 2010

Reported by:

Yaelle Daneshrad

CSR No. 11754



2

1 UNITED STATES DISTRICT COURT2 CENTRAL DISTRICT OF CALIFORNIA3

4 ASIA ECONOMIC INSTITUTE, LLC, ) et al., )

5 ) Case No.: Plaintiffs, ) 2:10-CV-01360-

6 ) SVW-PJW v. )

7 ) XCENTRIC VENTURES, LLC, et al., )

8 ) Defendants. )

9 ___________________________________)10

11

12

13

14

15

16 DEPOSITION OF RAYMOND MOBREZ,17 taken on behalf of the Defendants,18 at 777 South Figueroa Street, 47th Floor,19 Los Angeles, California, commencing at20 10:12 A.M., Friday, May 7, 2010, before21 Yaelle Daneshrad, Certified Shorthand22 Reporter No. 11754.23

24

25

3

1 APPEARANCES OF COUNSEL:2 For Plaintiffs:3 LISA BORODKIN, ESQ. (Through page 210)

-and-4 DANIEL BLACKERT, ESQ.

11766 Wilshire Boulevard5 Suite 260

Los Angeles, California 900256 (310) 806-30007

8 For Defendants:9 GINGRAS LAW OFFICE

BY: DAVID S. GINGRAS, ESQ.10 4072 East Mountain Vista Drive

Phoenix, Arizona 8504811 (480) 639-499612

JABURG WILK13 BY: MARIA CRIMI SPETH, ESQ.

3200 North Central Avenue14 20th Floor

Phoenix, Arizona 8501215 (602) 248-108916

17 ALSO PRESENT:18 ILIANA LLANERAS19 JULIO PENA, Videographer20

21

22

23

24

25

4

1 I N D E X2

3 DEPONENT EXAMINED BY PAGE4 RAYMOND MOBREZ MR. GINGRAS 85

6 E X H I B I T S7 EXHIBIT PAGE8 Exhibit 1A - Screen shot of Ripoff 40

Report9

Exhibit 1B - Ripoff Report text 4010

Exhibit 2A - Screen shot of Ripoff 4011 Report12 Exhibit 2B - Ripoff Report text 4013 Exhibit 3A - Screen shot of Ripoff 40

Report14


Exhibit 4A - Screen shot of Ripoff 4016 Report17 Exhibit 4B - Ripoff Report text 4018 Exhibit 5A - Screen shot of Ripoff 40

Report19


Exhibit 6A - Screen shot of Ripoff 4021 Report22 Exhibit 6B - Ripoff Report text 4023

24

25

5

1 E X H I B I T S2 EXHIBIT PAGE3 Exhibit 7 - California Secretary of State 44

Business Entity Detail4

Exhibit 8 - "Who Is" Search Results 465

Exhibit 9 - "El Rodeo" publication 596

Exhibit 10 - Complaint 707

Exhibit 11 - Asia Economic Institute 838 Links Exchange9 Exhibit 12A - "Who Is" Search Results 188

10 Exhibit 12 - Asia Business printout 18711 Exhibit 13 - February 15, 2009, 192

e-mail12

Exhibit 14 - April 28, 2009, e-mail 19413

Exhibit 15 - May 5, 2009, e-mail 19614



Exhibit 18 - July 24, 2009, e-mail 20717

Exhibit 19 - Declaration of Raymond 21418 Mobrez Pursuant to the Court's Order

on April 19, 2010, Regarding Plaintiffs'19 RICO and Extortion Causes of Action20 Exhibit 20 - Handwritten notes 22721 Exhibit 21 - Phone bills of Mr. Mobrez 23222 Exhibit 22 - Subpoena to Produce 256

Documents, Information, or Objects or to Permit23 Inspection of Premises in a Civil Action24 Exhibit 23 - Affidavit of Raymond Mobrez 261

in Opposition to Defendants' Special25 Motion to Strike



42

1 Q All right. While we're finishing up with

2 that, again, I don't want to get into each specific

3 statement that you're concerned about because I

4 think it will take too much time.

5 But I would like you to spend time with

6 these and highlight or underline in whatever way you

7 wish the exact statements that you claim are false

8 and that you claim have hurt you in some way.

9 Do you understand that?

10 A Correct.

11 Q Okay. Let's go back to AEI for a minute.

12 What kind of business is AEI?

13 A Publication, news about economics and

14 financial.

15 Q Does AEI or did AEI ever sell any goods?

16 A No.

17 Q Did it ever sell any services?

18 A No.

19 Q How did AEI make money or try to make

20 money?

21 A AEI was in the R and D stage, and

22 practically they reached the finish line. We were

23 about to put our seminars, conferences, perhaps

24 selling a membership to some of the programs.

25 Q Is that everything?

43

1 A That's about --

2 Q I'm still not clear at all on how you3 intended to make money through AEI. Can you just4 sort of explain to me what services or products --5 A Seminars, conferences.

6 Q What do you mean by seminars?7 A Seminars.

8 Q Seminars on what?9 A In economics, finance.

10 Q So your intent was to put on a seminar11 where you would speak on some issue and then you12 would charge money for people to come there?13 A Not personally but, yes. Conferences and

14 seminars are conducted not by the, only the

15 principal. There's other people that come into

16 these forums.

17 Q You'd hire speakers or --18 A Yeah, yes.

19 Q Did AEI ever actually do that?20 A It's about to do it.

21 Q That wasn't my question. In the past has22 AEI ever put on any seminars?23 A No.

24 Q Has AEI ever made any money?25 A No.

44

1 Q I think I read in your declaration, and2 we'll get to that in a minute, that AEI has been in3 business for nine years; is that right?4 A Correct, existence.5 MR. GINGRAS: Can I have Exhibit 7,6 please.7 MS. SPETH: So you're not going to use 18 through 6? You needed me to mark them.9 MR. GINGRAS: They're there.

10 MS. SPETH: Okay.11 MR. GINGRAS: Did you give --12 MS. SPETH: I gave them their set, yes.13 BY MR. GINGRAS:14 Q Do you have 1 through 6 in front of you?15 A I have one --16 Q I'm sorry. She gave them to me, and I17 didn't give them to you. That's the problem.18 A So where is the one? Or doesn't matter19 what order?20 Q You know, I do have a couple of specific21 questions about reports, and we'll get to them in a22 minute, so if you can just keep them in order as23 best you can.24 A Okay.25 (Whereupon, Exhibit 7 was marked for

45

1 identification and is bound under separate

2 cover.)

3 BY MR. GINGRAS:

4 Q I'll show you what I've marked as5 Exhibit 7. Exhibit 7 is a printout of the6 California Secretary of State website where you can7 find information on companies. And I printed this8 out myself some time ago.9 And it occurred -- it appears here that

10 Asia Economic Institute, LLC, was formed on11 February 7th, 2007.12 Do you see that date on Exhibit 7?13 A Yes, I do.

14 Q Does that date accurately reflect the date15 that AEI was formed as an LLC?16 A Yes.

17 Q Prior to February of 2007, did AEI exist18 as simply a sole proprietorship or some kind of19 unincorporated business?20 A Unincorporated.

21 Q Right. Was it a DBA of something else?22 A I believe maybe a DBA, yes.

23 Q Of one of your other companies?24 A Yes.

25 Q Do you know which one?


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46

1 A Not any of the companies. DBA by itself.

2 Q Okay. Does AEI have a website?3 A Yes.

4 Q Is that website located at5 www.AsiaEcon.org?6 A Yes.

7 (Whereupon, Exhibit 8 was marked for

8 identification and is bound under separate

9 cover.)

10 BY MR. GINGRAS:

11 Q Exhibit 8. Mr. Mobrez, I'll show you what12 I've marked as Exhibit 8 to your deposition. This13 is a "Who Is" search for the website AsiaEcon.org.14 This document appears to reflect the date15 that that domain name was purchased as being the16 26th of January 2007. Is that about what your17 memory is as to the date that you first created the18 or purchased the AsiaEcon.org domain name?19 A Domain, yes.

20 Q Prior to January 26, 2007, did AEI have21 any other website that it used for business?22 A No.

23 Q It simply just didn't have a web presence?24 A Exactly.

25 Q Prior to that date.

47

1 Okay. How many people currently work at

2 AEI?

3 A There's nobody working at AEI.

4 Q Okay. In the past, what was the largest

5 number of employees that you had at any one time?

6 And for the purposes of that question, let's define

7 "employees" as including W-2 employees, independent

8 contractors, interns, exchange students, anybody

9 that showed up to work at AEI on a more or less

10 regular basis.

11 What's the largest number of people that

12 you had working for AEI at any one time?

13 A Twenty-seven, 25.

14 Q And do you have records showing who those

15 people were?

16 A I'm assuming, yes, we had some records,

17 yes.

18 Q Would those people have worked for AEI

19 before or after it was formed as an LLC?

20 A After.

21 Q Prior to it being formed as an LLC, did it

22 have any employees, AEI?

23 A No.

24 Q Okay. During -- when did AEI actually

25 cease doing business? Obviously it began in

48

1 February of 2007. And I think you just said it's

2 been out of business for at least a year. Your

3 testimony is what it is.

4 When, when did AEI last engage in anything

5 that you would consider doing business?

6 MR. BLACKERT: Objection. Vague and

7 ambiguous.

8 THE WITNESS: Maybe June --

9 BY MR. GINGRAS:

10 Q Of what year?

11 A 2009.

12 Q June of 2009?

13 A Uh-huh.

14 Q And from the time that AEI was formed in

15 February of 2007 until June of 2009, what do you

16 think is the total number of employees -- again, I'm

17 defining that term more broadly than just W-2

18 employees -- what do you think is the total number

19 of people who came through your doors as employees?

20 A It's a very broad question. I don't

21 remember exactly.

22 Q You said there were 27 people or so

23 working there at one time. Are we talking about 27

24 or maybe 30 employees in the lifetime of the

25 company, or was it more than that?

49

1 A I --

2 Q My question is whether or not you had

3 somebody who came in, worked for a week and then

4 left.

5 A For a weekend or a week?

6 Q A week, a day, a month, whatever.

7 A Many.

8 Q You have many people?

9 A Yeah.

10 Q And do you have records referring to who

11 those people are?

12 A Depends. If it's an outside contractor, a

13 lot of times we did not retain the information.

14 Q Well, you would have some sort of -- you

15 would have paid them something, wouldn't you?

16 A I assume, yes.

17 Q Tell me, when people work at AEI, what do

18 they do?

19 A Web development, structuring this web

20 itself, building up the site, content management,

21 developing the programs.

22 Q And I assume that you had at least one W-2

23 employee. Do you know what I mean when I say W-2?

24 A On the payroll?

25 Q Right.



50

1 A Yes.

2 Q How many employees did you have that were3 not W-2 employees? How many workers? Let's use4 that word.5 A I don't remember exactly.

6 Q Majority of them?7 A Because we were in a stage of development

8 of the site, predominantly the technicians or web

9 developers are independent contractors.

10 Q Did you ever have people that worked for11 you for free?12 A Yes.

13 Q How many?14 A A few.

15 Q How many is a few?16 A Five, 10, 20.

17 Q Could it have been more than that?18 A Worked for free what purpose?

19 Q I don't know, but I don't really care.20 I'm just asking you if people worked there who21 didn't get paid, because they were interns, because22 they were students, whatever.23 A Because they were sent by universities?

24 Q Sure.25 A Yes.

51

1 Q Okay. Just to rewind slightly, you said

2 that AEI basically ceased doing business in June of

3 2009; is that right?

4 A Yes.

5 Q Is there some specific event that sticks

6 out in your mind as the day that you closed the

7 doors or turned off the lights? Is there something

8 that happened in June that made you make a decision

9 to stop doing business with AEI?

10 A We were basically this reports, Ripoff

11 Report, was in our throat and we were suffocating.

12 I don't know what time the last breath came out.

13 You're asking me when was the last breath,

14 I don't know exact moments of it. But it did die,

15 yes.

16 Q Mr. Mobrez, an important issue in this

17 case is whether or not the reports that you have in

18 front of you actually caused AEI to suffer any

19 losses. Okay?

20 And I think you just explained to me that

21 AEI never made any money ever; right?

22 A We, we --

23 Q It's a yes-or-no question.

24 A Answer is no and also yes. You open an

25 ice cream shop, you sign a lease, and something

52

1 horrible happens the day you open it, and nobody

2 comes back again to that shop.

3 Did it make money? No. Did it make an

4 effort to make the money? Yes, they did. Every

5 business is the same.

6 Q What effort did you make to make money?

7 You said that you never actually held any seminars,

8 so how do you know how successful that seminar would

9 have been if you had had one?

10 MR. BLACKERT: Objection. Overbroad.

11 Calls for speculation. Vague and ambiguous.

12 BY MR. GINGRAS:

13 Q You can answer the question.

14 A Seminar business, it's a model that has

15 been very successful throughout the United States

16 and the world. Challenging that particular how the

17 people will go there and why they would go there, I

18 can't speak of that.

19 All I can tell you, the same thing as

20 University of Phoenix. Opens it up the door,

21 classrooms comes in, students will come and pay for

22 the class. But you can't say if we would not have

23 built the building, how will you know somebody will

24 go to the building. I can't speak to the

25 speculation of that.

53

1 Q Two things. First of all, how much

2 seminar experience do you have?

3 A I've been doing seminar, going myself to,

4 religiously to all kinds of seminars almost 25, 27

5 years.

6 Q But in terms of putting on seminars,

7 managing seminars and charging people to attend

8 seminars, how much experience do you have doing any

9 of those things in your life?

10 A This is not a business that you need to

11 have a personal experience as much as you need to

12 have a content, the subject matter and understanding

13 of the, the business.

14 Q So the answer is that you've never had any

15 experience doing seminars but you think you would

16 have been good at it?

17 MR. BLACKERT: Objection.

18 Mischaracterizes witness's testimony.

19 THE WITNESS: Not myself. I can -- you're

20 talking about who would manage day-to-day

21 operation of a seminar? Those are

22 seminar-operating people.

23 BY MR. GINGRAS:

24 Q But you yourself never ran any seminar

25 businesses in the past?


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54

1 A No.

2 Q Okay. And you made me lose my train of

3 thought. Give me just a second.

4 MR. BLACKERT: You want to break for a

5 couple minutes? Or you want to keep --

6 MR. GINGRAS: No, no, let's keep going.

7 Q Mr. Mobrez, you would agree with me, you

8 used the ice cream shop example; right? You would

9 agree with me that some people open ice cream shops

10 and they fail despite their best efforts? Isn't

11 that a fair statement?

12 MR. BLACKERT: Objection. Vague and

13 ambiguous.

14 THE WITNESS: They would sell at least one

15 ice cream first day.

16 BY MR. GINGRAS:

17 Q I would hope so. But sometimes businesses

18 fail just because that's the way businesses work?

19 Isn't that a fair statement?

20 MR. BLACKERT: Objection. Call for

21 speculation.

22 THE WITNESS: It's a very peculiar, it's a

23 very peculiar way of looking at the businesses.

24 BY MR. GINGRAS:

25 Q Are you saying that no business ever

55

1 fails?2 A Businesses fails in different manners and

3 shapes and forms.

4 Q Well, and most people wouldn't reach the5 conclusion that their business had failed until they6 had at least tried selling one ice cream cone;7 right?8 MR. BLACKERT: Objection. Vague and

9 ambiguous. Calls for speculation. Overbroad.

10 BY MR. GINGRAS:

11 Q Don't answer, don't answer the question.12 What I'm trying to get at is couldn't --13 isn't it fair to say that you could try to put on a14 seminar tomorrow; right? There's no reason you15 couldn't try?16 A Sir, this is not an intelligent

17 conversation. I will say over and over, there's no

18 one will go to my seminar tomorrow when my name is

19 tarnished and name of the organization is tarnished.

20 Q I understand Moses won't go to your21 seminar. But how do you know that other people22 won't unless you try?23 MR. BLACKERT: Objection. Calls for

24 speculation. Harassing.

25 \\\

56

1 BY MR. GINGRAS:2 Q All right. Do you want to move on or -- I3 jut want your testimony on this. You're going to4 have to explain it to a jury if you don't explain it5 to me, so I'd like to know.6 A I'll explain to you and the jury the same7 way.8 MR. BLACKERT: Objection. Harassing.9 MS. BORODKIN: Can we go off the record

10 for a second?11 MR. GINGRAS: No, we cannot.12 MS. BORODKIN: It's not a jury trial.13 MR. GINGRAS: Yes, it is. Read the14 Court's order.15 Q Mr. Mobrez, I just want to understand your16 position. I'm not trying to be harassing. I'm17 trying to have you tell me what I'm not getting18 clearly. Is there anything --19 A What is your question?20 Q My question is how do you know that your21 business has failed if you've never tried putting on22 any seminars?23 A Sir, I used to go out and hand my business24 card. People would love to contact me again, talk25 to me. Asia Economics. And they wanted to know

57

1 more about Asia.

2 Today I hand a business card or I would

3 have handed a business card in six, nine months ago,

4 nobody will even contact me back again.

5 Q Okay.6 A The pattern changed drastically.

7 Q Let's move on a little bit. I think8 everyone would agree it's time to do that.9 Your complaint references a report on my

10 client's website that talks about a person who said11 that they had a job interview with you and accepted12 the job interview, I think, and then they were going13 to report for work the next day but they Googled14 your name, found these reports and decided to blow15 you off. Does that ring a bell generally?16 A I have seen it on your report.

17 Q See if you can find Exhibit 4.18 A So which one is -- I apologize. Okay,

19 thank you. Four, yes.

20 Q And 4A specifically is kind of a screen21 print of the Ripoff Report website. And then 4B is22 the actual text of what's there, minus the23 surrounding art and so forth.24 Do you remember interviewing a person who25 you offered a job to -- I'm just going to, I'm just


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162

1 mentioned about a truck run over you and ice cream.

2 This is worse than an ice cream truck -- truck run

3 over me. And we went back to make sure every bones

4 are there to make sure it's absolutely dead.

5 Q But who's driving that truck?

6 A Ed Magedson.

7 Q Is he?

8 A Who owns this Ripoff Report?

9 Q I think in your example, Mr. Magedson

10 would be more like the truck manufacturer and the

11 author would be a little more like the driver.

12 Don't you think that is a fair characterization?

13 A No. The driver is Mr. Magedson, owns the

14 truck and drives over it. He has every rights, he

15 has -- he has to be precaution himself and say "Why

16 am I driving over this person?"

17 I offered him everything in the beginning

18 to rectify all of this. He's not interested on

19 that.

20 Q But the people that are reading the report

21 would be, wouldn't they?

22 A How they would be interested in we -- we

23 finished that discussion long ago, about two hours

24 ago, that when you post this rebuttal, as you are

25 referring to, it is all the way down and it is

163

1 sometimes it's there, sometimes it's not there.

2 Even if it's there, let's say the perfect

3 scenario, people will not go to do business with you

4 when they will find out you are a child molester.

5 And you are not a child molester. How would you

6 feel about it?

7 Q I'd be very angry at the person that wrote

8 that.

9 A And then you would contact Google, and

10 they will tell you go and tell them to take it off.

11 Q Well, we're getting a little far afield.

12 Let's, let's get back. Unless, I mean, you're

13 welcome to stay here until midnight with me. I

14 don't want to keep you that long. So let's, we'll

15 both try to focus ourselves.

16 Getting back to your unfair business

17 practices claim, I will tell you as a legal

18 principle, I'm not asking you for your feelings

19 about it, but California law generally limits your

20 recovery to what's called restitution. Okay? That

21 would be money that the defendant improperly took as

22 a result of whatever these acts are.

23 What money do you believe Xcentric should

24 have to pay back as restitution under your unfair

25 business practices claim?

164

1 MR. BLACKERT: Objection. Calls for a

2 legal conclusion.

3 THE WITNESS: This is a legal question. I

4 can't respond to a legal -- I'm not a legal

5 expert. I'm just a normal person.

6 BY MR. GINGRAS:

7 Q Okay. Is there money that you paid to

8 Xcentric that you're looking to recover?

9 A I don't have to pay him. He was asking

10 for it. I couldn't afford to pay him.

11 Q So you actually paid nothing to Xcentric?

12 A I didn't.

13 Q Okay. Do you have any evidence that

14 Xcentric received any money from anyone else as a

15 result of these postings on the -- the specific six

16 postings about you on the Ripoff Report website?

17 A I can't speak of that because I don't know

18 what between them happened until you provide me your

19 information. Your information is going to show if

20 Mr. Magedson get paid or didn't get paid.

21 Q Let's look at page 21 of Exhibit 10, the

22 complaint in front of you.

23 A Twenty-one?

24 Q I'm not sure why I just said that. I was

25 actually looking for paragraph 93, which is not on

165

1 21. It is on 27. Are you there now?

2 A Page 27?

3 Q Page 27, paragraph 93. Do you see that

4 paragraph?

5 A Yes.

6 Q Talks about contractual relationships with

7 current and former employees of AEI who but for

8 defendant's publications would have entered into

9 valid contractual relationships.

10 What employees are you referring to in

11 paragraph 93? What are their names?

12 A I don't have the names front of me. They

13 were people at that time they were working and

14 depending on this institute.

15 Q And is it your position that people that

16 worked for you quit because of Ripoff Report?

17 A Absolutely.

18 Q Who?

19 A Everybody.

20 Q They told you that they quit because of

21 Ripoff Report? Or you simply assumed that they did?

22 A Well, it was e-mail exchange with some of

23 them. I found out that later, that also they were

24 saying, "Did you see this report about AEI?"

25 Would you work for AEI if you would have

Q Talks about contractual relationships Q Talks about contractual relationships with

current and former employees of AEI who but for7

defendant's publications would have entered into8

valid contractual relationships.9

What employees are you referring to in10

paragraph 93? What are their names?11

A I don't have the names front of me. T A I don't have the names front of me. They12

were people at that time they were working and13

depending on this institute.14

Q And is it your position that people th Q And is it your position that people that15

worked for you quit because of Ripoff Report?16

A Absolutely. A Absolutely.17

Q Who? Q Who?18

A Everybody. A Everybody.19

Q They told you that they quit because o Q They told you that they quit because of20

Ripoff Report? Or you simply assumed that they did?21

A Well, it was e-mail exchange with some A Well, it was e-mail exchange with some of22

them. I found out that later, that also they were23

saying, "Did you see this report about AEI?"24

Would you work for AEI if you would have25




166

1 had such a report as these are scam artists and they

2 took people -- you think somebody will hire you if

3 they will know you are a child molester?

4 Q Was that answering the question?5 A I apologize.

6 Q First of all, you mentioned e-mails. What7 e-mails are you referring to?8 A Between two people that were working at

9 the institute.

10 Q These are e-mails that you saw?11 A I've seen them.

12 Q And you still have them?13 A I have to look for it.

14 Q And you can't tell me the names of any of15 these people who were talking about the Ripoff16 Report posting who then quit?17 A It's year and a half has passed. It's

18 more than 15 months has passed. I don't have the --

19 it's been very devastating for me mentally and

20 emotionally that this will happen to me. You're

21 treating this very lightly.

22 Q I'm sorry. I'm treating it lightly?23 A This is -- you're treating very lightly.

24 Q I'm actually treating it very seriously.25 A Thank you.

167

1 Q I'm treating it very seriously, and I

2 really do want to understand your case because, if I

3 understand your case, you don't know me, you don't

4 know the kind of person that I am, but if I

5 understand your case and I'm convinced that your

6 case is legitimate and valid, I would take that

7 extremely seriously.

8 My reputation is on the line as far as I'm

9 defending someone that is accused of doing very bad

10 things. If that person is guilty of those things, I

11 don't want to be associated with that person. Do

12 you understand --

13 A I hope you do.

14 Q So I want you to help me understand

15 whether or not I'm working for a bad guy.

16 A I'm sure by now you know who he is.

17 Q I think that's fair, I do. But I'm trying

18 to understand your case and your claims and why you

19 think he's so bad.

20 Let me ask you this, Mr. Mobrez.

21 Something I'm troubled with is this: The reports,

22 the six of them there, there are a lot of factual

23 statements in there, but if you want to generalize,

24 a couple of them kind of talk about don't work at

25 AEI because you're not a nice man and it's not a

168

1 good place to work.

2 Do you think it's kind of a fair way of

3 characterizing just generally a couple of those

4 reports?

5 A I can't speak of what somebody else says.

6 But I can tell you many, many people, they work

7 there, and one of them went even from out of his way

8 and wrote from bottom of his heart the rebuttal that

9 you are characterizing as a rebuttal. This says

10 this is a good place to be in.

11 Q But these reports generally say that

12 working there is not a good thing; right?

13 A I can't speak of somebody -- I don't know

14 who they are. I mean, I have no idea if they even

15 worked there.

16 MS. SPETH: We should take a break maybe.

17 MR. GINGRAS: No, we shouldn't. I need to

18 keep going here. Just hang on.

19 Q Do you recall reading one of the reports

20 that said something about you shouldn't work there

21 because you'd have more self-respect cleaning

22 toilets or working in a fast food place or something

23 like that? Does that ring a bell to you?

24 A I saw something about cleaning toilets.

25 And obviously that tells you that the writer's

169

1 demeanor -- I don't know if that's a true statement.

2 Q Here's the part that troubles me. Okay?

3 If AEI is a good place to work and if the statements

4 that say you don't pay your employees overtime or

5 you don't pay them fairly, if those statements are

6 false, the people that work there would know that,

7 wouldn't they?

8 MR. BLACKERT: Objection. Statements

9 speak for themselves. Calls for a

10 conclusion --

11 BY MR. GINGRAS:

12 Q I mean, if you tell me that I shouldn't go

13 outside because it's raining too hard and I look out

14 the window and see that it's sunny, I don't

15 understand how your statement about it raining is

16 going to impact me in any way.

17 Can you help me understand that?

18 MR. BLACKERT: Objection. Hypothetical.

19 Irrelevant. Vague and ambiguous.

20 THE WITNESS: This is a very, very

21 hypothetical question. Because it doesn't help

22 if somebody -- I have no idea -- you have to

23 provide us first who they are. Then I can make

24 intelligent assessment.

25 And you keep saying hypothetically there's

had such a report as these are scam artists and they1

took people -- you think somebody will hire you if2

they will know you are a child molester?3

Q Was that answering the question? Q Was that answering the question?4

Q And you can't tell me the names of any Q And you can't tell me the names of any of1414

these people who were talking about the Ripoff1515

Report posting who then quit?1616

A It's year and a half has passed. It's A It's year and a half has passed. It's1717

more than 15 months has passed. I don't have the --1818

it's been very devastating for me mentally and1919

emotionally that this will happen to me. You're2020

treating this very lightly.2121

Q I'm sorry. I'm treating it lightly? Q I'm sorry. I'm treating it lightly?2222

A This is -- you're treating very lightl A This is -- you're treating very lightly.2323

Q I'm actually treating it very seriousl Q I'm actually treating it very seriously. Q I'm actually treating it very seriousl2424

A Thank you. A Thank you.2525
