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1 Cause No Filed 09 September 30 P2:31 Loren Jackson - District Clerk Harris County ED101J By: candice d. haynes BARBARA DOREEN HOUSE IN THE DISTRICT COURT v. 234 th JUDICIAL DISTRICT DANIEL S. FRISHBERG a/k/a THE MONEYMAN ; ELISEA T. FRISHBERG d/b/a FRISHBERG, JORDAN STEWART & KALETA ADVISORS; DANIEL FRISHBERG FINANCIAL SERVICES, INC., d/b/a FRISHBERG & JORDAN ADVISORS; ALBERT KALETA BUSINESSRADIO PARTNERS, LP; BUSINESSRADIO PARTNERS DALLAS, LP;BUSINESSRADIO PARTNERS HOUSTON, LP; BUSINESSRADIO INC., BUSINESS- RADIO NETWORK, LP; and BUSI- NESS RADIO NETWORK GP, LLC. v. HARVEY J. HOUSE, and DARIA LYSA HOUSE HARRIS COUNTY, TEXAS FIRST AMENDED ANSWER, SPECIAL EXCEPTIONS AND ORIGINAL THIRD-PARTY ACTION, AND REQUEST FOR DISCLOSURE TO THE HONORABLE JUDGE OF SAID COURT: NOW COME, DANIEL S. FRISHBERG, ELISEA T. FRISHBERG, ALBERT KALETA, DANIEL FRISHBERG FINANCIAL SERVICES, INC., FRISHBERG & KALETA CAPITAL MANAGEMENT, FRISHBERG JORDAN & STEWART ADVISORS, INC., BUSINESS RADIO PARTNERS, LP, BUSINESS RADIO PARTNERS - DALLAS, LP, BUSINESS RADIO PARTNERS - HOUSTON, LP, BUSINESS RADIO INC., BUSINESS RADIO NETWORK, LP, BUSINESS RADIO NETWORK GP, LLC, the Defendants in the above styled and numbered cause, and
2 file this their First Amended Answer, Special Exceptions and Original Third-Party Action and Request for Disclosure. By way thereof, the Defendant s shows as follows: 1.0. FIRST AMENDED ANSWER Special Exceptions The Defendants specially except to the allegations contained in paragraph of the Plaintiff s Original Petition and Request for Disclosure ( the Petition ) as follows: a. The allegations are not limited to the only Defendants named therein, and the other Defendants do not know whether the allegations are applicable to them. If the Plaintiff is alleging that the breach of fiduciary duty claims are only alleged against the named Defendants, they should so plead. b. The allegations do not give the Defendants what fiduciary duties they are alleged to have violated. Despite its reference to previous paragraphs, this portion of the Petition fails to give the Defendants sufficient notice of the nature of the claim so that they may adequately defend themselves The Defendants specially except to the allegations contained in paragraph of the Petition because it fails to give the Defendants sufficient notice of what acts are alleged to have been made with malice, or created a risk of significant harm. Without having notice of the facts relied upon the Plaintiff, the Defendants cannot adequately prepare their defenses in this matter. First Amended Answer and Original Third - Party Action Page 2 of 12.
3 The Defendants specially except to the allegations contained in paragraph of the Petition because it fails to state what facts were misrepresented or not disclosed, and which Defendants made such representations or omissions. The Defendants request that the Plaintiff be ordered to plead what representation or disclosures were made or omitted to whom they were made and who made them. It also fails to disclose what facts were relied upon by the Plaintiff and how they were material. Without such pleadings, the Defendants are unable to prepare an adequate defense to the allegations The Defendants specially except to the allegations contained in paragraph of the Petition because it fails to give the Defendants sufficient notice of what acts are alleged to have been made with malice, or created a risk of significant harm. Without having notice of the facts relied upon the Plaintiff, the Defendants cannot adequately prepare their defenses in this matter The Defendants specially except to the allegations contained in paragraph of the Petition because it fails to state with any degree of particularity what any of the Defendants did which would constitute an act in furtherance of any conspiracy. The Defendants also except to this paragraph because it fails to state how any of the Defendants, or which Defendants, participate and/or assisted in the acts alleged. The Defendants specially except to the allegations in this paragraph because there is no allegation as to what breaches of fiduciary duty or fraud that it is alleged that each Defendant participated in The Defendants specially except to the allegations contained in paragraph of the Petition because it fails to state with any degree of specificity the facts upon which the allegations are based. It fails to allege what acts were First Amended Answer and Original Third - Party Action Page 3 of 12.
4 undertaken by which Defendants which might make them liable for the acts of the others. It fails to state fraud or injury was accomplished. And it fails to state what entities or individuals are alter egos of what other entities. Without such knowledge, the Defendants are unable to prepare an adequate defense Specific Denials The Defendants deny that all conditions precedent to the filing of this lawsuit have occurred The Defendants specifically deny that any of the damages claimed by the Plaintiff in this case were caused by any actions of the Defendants, and avers that such damages were caused by the Third-Party Defendants Affirmative Defenses Defendants deny any and all liability on their parts to the Plaintiff. However, in the unlikely event that the Court or jury should find that Defendants committed any tortious conduct toward Plaintiff, Defendants invoke the doctrine of comparative responsibility as provide for in Tex. Civ. Prac. & Rem. Code , et seq. In the unlikely event that the Court or jury should find the Defendants are liable such recovery should be reduced or should be barred by the comparative responsibility of the Plaintiff and her husband In the unlikely event that the Court or jury should find comparative responsibility on the part of the Defendants, which is denied, such Defendants joint and several liability, if any, is limited under the provisions of Tex. Civ. Prac. & Rem. Code First Amended Answer and Original Third - Party Action Page 4 of 12.
5 Plaintiff is not entitled to recover attorney s fees for their alleged causes of action for breach of fiduciary duty, civil conspiracy to commit theft, common law fraud Defendants allege that under the facts and circumstances of this case, an award of punitive damages would violate substantive and procedural due process in violation of the Fifth and Fourteenth Amendments of the United States Constitution in the following respects: a. It is unconstitutional to allow a citizen to be punished upon the basis of a standard as vague and ill-defined as the common law concepts upon which punitive damages can be awarded. b. It is unconstitutional to allow a citizen to be punished for any conduct when the citizen is unable to determine, prior to the hearing, what the standards used in assessing that punishment will be and where the jury has almost total or unbridled discretion in determining the amount of that punishment. The standards for assessing punitive damages in this case are unconstitutionally vague, and allow the jury to assess punitive damages based upon criteria wholly unrelated to Defendants conduct and completely beyond the control of the Defendants. c. Because the award of punitive damages has quasi-criminal attributes, both as to rationale and effect, it is unconstitutional to award punitive damages based solely upon a mere preponderance of the evidence which may be provided by the slightest circumstantial evidence, coupled with speculation and innuendo. First Amended Answer and Original Third - Party Action Page 5 of 12.
6 d. It is unconstitutional for a state to allow a private citizen with a profit motive to seek punishment of another citizen without the full protections of the Texas and United States Constitutions, including privilege against self-incrimination, and the right not to be placed in double jeopardy. The fiction that punishment in civil suits does not invoke the constitutional protections, whereas the same punishment in a criminal suit does, should be abandoned. In either event, the state is forcing Defendants to forfeit valuable property interests An award of punitive damages, as sought by Plaintiff under the facts and circumstances of this case, would violate the excessive fines, cruel and unusual punishment, and due process clauses of the Texas Constitution Plaintiff right to recover punitive damages is limited in accordance with the provisions of , TEX. CIV. PRAC. & REM. CODE. Defendants further plead: a. The standards for recovery of punitive damages as contained in TEX. CIV. PRAC. & REM. CODE b. The factors precluding the recovery of punitive damages as contained in TEX. CIV. PRAC. & REM. CODE c. The requirement that an award of punitive damages be specific as to each Defendant as contained in the TEX. CIV. PRAC. & REM. CODE d. The preclusion of prejudgment interest on a recovery of punitive damages as contained in TEX. CIV. PRAC. & REM. CODE e. The limitations on the recovery of punitive damages as contained in First Amended Answer and Original Third - Party Action Page 6 of 12.
7 TEX. CIV. PRAC. & REM. CODE General Denial The Defendants deny each and every allegation made by the Plaintiff ORIGINAL THIRD-PARTY CLAIM Statement of the Nature of the Case The Defendants, now acting as Third-Party Plaintiffs ( the Third-Party Plaintiffs ) sue the Plaintiff s Husband and his daughter ( the Third-Party Defendants ) because they are liable to the Plaintiff for the damages sought in this case, and independently liable to the the Third-Party Plaintiff herein The Parties Daniel Frishberg Financial Services, Inc. ( DFFS ). The Defendant, DFFS is now acting as a the Third-Party Plaintiff Harvey J. House, Jr. ( House ). The Third-Party Defendant, HARVEY J. HOUSE, JR., is an individual residing in Harris County, Texas who may be served with process by serving him at his residence at Big Creek Falls, Spring, Texas, Daria House. ( Daria ). The Third-Party Defendant, DARIA HOUSE, is an individual who resides in Harris County, Texas. Daria s current residential address is unknown and will provided at a later date The Facts The Plaintiff, who at that time was recently widowed, sought financial guidance from DFFS. The Third-Party Plaintiff provided such guidance to the Plaintiff, and also assisted the Plaintiff in making arrangements for her finances in the absence of her deceased husband. The Third-Party Defendant, House, who First Amended Answer and Original Third - Party Action Page 7 of 12.
8 was at that time doing business as Celebrity Limousine Service, was associated with DFFS by virtue of the fact that House chauffeured DFFS out of town clients when needed. House s association with DFFS was longstanding, and its principles had lent House funds in the past. DFFS trusted House with various minor responsibilities and relied on him as dependable source of help House met the Plaintiff when after the death of her husband, when the Plaintiff s previously existing medical conditions were aggravated, rendering her in need of medical and psychiatric care and consultation. House was assigned by DFFS to transport the Plaintiff to and from her appointments, and oversee her moving to a residence more suitable to her new situation. House, taking undue advantage of the Plaintiff s situation, obtained the confidence of the Plaintiff and convinced her to marry him. Upon learning that the Plaintiff was to marry her new driver only shortly after the death of her husband, DFFS arranged for the Plaintiff to be represented by competent counsel, who drafted a pre-nuptial agreement for the Plaintiff and House to sign prior to the formal wedding which had been announced. House, received the pre-nuptial agreement from DFFS and took it to the attorney for the Plaintiff for review. Apparently on the advice the attorney for the Plaintiff in this case, House convinced the Plaintiff that it was not necessary to sign the pre-nuptial agreement, and that a formal wedding would not be necessary. They were shortly thereafter married, and the Plaintiff never signed the pre-nuptial agreement After House married the Plaintiff he convinced the Plaintiff that she should invest her money in the various business enterprises of House and his daughter, Daria. House, who holds himself out as a music promoter, did business as the Gospel Allstars, Humphrey House Music, H&P Records, and Big Joe First Amended Answer and Original Third - Party Action Page 8 of 12.
9 Hill, the Blues Man. Daria and House formed a production company known as House Productions. The Third-Party Plaintiff is informed and believes, based on conversations with House and the Plaintiff, that the substantial assets received from the Plaintiff s deceased husband have been depleted, not by any actions of the Defendants in this case, but by the actions of Harvey and Daria by imprudent investments in their promotional enterprises House completely took over the management of the Plaintiff s business affairs. He made representations to the Third-Party Plaintiff as to the amount of money the Plaintiff needed to meet her monthly expenses, and encouraged the Third-Party Plaintiff to make more speculative investments to allow the Plaintiff to continue to finance his business enterprises. When the Third-Party Plaintiff explained to House that such actions were not in the best interest of the Plaintiff, House through the misuse of the Plaintiff s trust, and deception, convinced the Plaintiff to terminate her contract with the Third-Party Plaintiff First Cause of Action: Tortious Interference The Third-Party Plaintiff had a contract with the Plaintiff to act as her financial adviser. The Third-Party Defendants knew of that contract, and without cause, intentionally and deliberately convince the Plaintiff to terminate her contract with the Third-Party Plaintiff. As a direct and proximate result of the actions of the Third-Party Defendants the Plaintiff terminated her contract with the Third-Party Plaintiff As a result of the actions of the Third-Party Defendants, the Third-Party Plaintiff has suffered actual damages in an amount in excess of the minimum jurisdictional levels of this court. First Amended Answer and Original Third - Party Action Page 9 of 12.
10 The actions of the Third-Party Defendants are actions for which the law allows the recovery of punitive or exemplary damages. The Third-Party Plaintiff requests such damages be assessed against the Third-Party Defendants in an amount sufficient to punish the the Third-Party Defendants and deter others from engaging in the type of conduct prohibited by the law Second Cause of Action: Liability for the Plaintiff s Damages The actions of the Third-Party Defendants in abuse their position of trust and confidence with the Plaintiff, and their undue influence on the Plaintiff, render the Third-Party Defendants liable the Plaintiff for the damages the Plaintiff seeks to recover from the Defendants Pursuant to Rule 38 of the Texas Rules of Civil Procedure, all of the Defendants hereby assert that the the Third-Party Defendants are liable for the claims that the Plaintiff has made against the Defendants in this case REQUEST FOR DISCLOSURE Pursuant to Rule of the Texas Rules of Civil Procedures, the Plaintiff are hereby requested to disclose, within 30 days of service of this request, the information or materials described in Rule 194.2, (a) - (l) and seasonally supplement the responses as specified in Rule of the Texas Rules of Civil Procedure PRAYER WHEREFORE, PREMISES CONSIDERED, the Defendants,DANIEL S. FRISHBERG, ELISEA T. FRISHBERG, ALBERT KALETA, DANIEL FRISHBERG FINANCIAL SERVICES, INC., FRISHBERG & KALETA CAPITAL MANAGEMENT, FRISHBERG JORDAN & STEWART ADVISORS, INC., BUSINESS RADIO First Amended Answer and Original Third - Party Action Page 10 of 12.
11 PARTNERS, LP, BUSINESS RADIO PARTNERS - DALLAS, LP, BUSINESS RADIO PARTNERS - HOUSTON, LP, BUSINESS RADIO INC., BUSINESS RADIO NETWORK, LP, BUSINESS RADIO NETWORK GP, LLC, respectfully request that the relief requested by the Plaintiff be denied, that citations be issued to the Third- Party Defendants named herein and that the Court enter Judgment against the Third-Party Defendants for actual and consequential damages in a sum in excess of the minimum jurisdictional amount of the Court, for exemplary damages in an amount sufficient to punish the Third-Party Defendants for their wrongful conduct and deter others from such actions; for reasonable and necessary attorney's fees, expert witness fees, and deposition expenses; for all costs of suit, pre-judgment interest as provided by law; post-judgment interest as provided by law from the date of the judgment until paid; and, such other and further relief to which the Defendants may be justly entitled. Respectfully submitted, LAW OFFICES OF PETER J. STANTON Suite 1350, Riverview Towers 111 Soledad San Antonio, TX Telephone (210) Telecopier (210) By: PETER J. STANTON State Bar No ATTORNEY FOR THE DEFENDANTS First Amended Answer and Original Third - Party Action Page 11 of 12.
12 CERTIFICATE OF SERVICE I certify that on September 30, 2009 a true and correct copy of the foregoing was sent by first class mail and by facsimile transmission to: David A. Bryant, Jr. The Bryant Law Firm 18 Augusta Pines Dr., Ste. 200W Spring, Texas By: PETER J. STANTON First Amended Answer and Original Third - Party Action Page 12 of 12.
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