NO RAUHAUSER S RESPONSE AND OBJECTION TO PLAINTIFFS MOTION FOR NEW TRIAL

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1 FILED TARRANT COUNTY 2/2/2016 4:16:18 PM THOMAS A. WILDER NO DISTRICT CLERK JAMES MCGIBNEY and VIAVIEW, INC., Plaintiffs, v. THOMAS RETZLAFF, LORA LUSHER, JENNIFER D ALLESANDRO, NEAL RAUHAUSER, MISSANNONEWS, and JANE DOES 1-5, Defendants IN THE DISTRICT COURT OF TARRANT COUNTY, TEXAS 67 th JUDICIAL DISTRICT RAUHAUSER S RESPONSE AND OBJECTION TO PLAINTIFFS MOTION FOR NEW TRIAL JEFFREY L. DORRELL State Bar No jdorrell@hanszenlaporte.com Katy Freeway, Suite 850 Houston, Texas Telephone: FAX: ATTORNEYS FOR PLAINTIFF-IN-JUDGMENT NEAL RAUHAUSER

2 TABLE OF CONTENTS I. ARGUMENT & AUTHORITIES 1 A. Plaintiffs Are Not Entitled to an Oral Hearing on Their Unsworn Motion for New Trial... 1 B. The Court s Local Rules Do Not Create Due Process Rights That Would Not Otherwise Exist 4 1. Procedural Due Process Does Not Require an Oral Hearing 4 2. This Court s Local Rules Cannot Create a Due Process Right That Trumps Controlling Authority and Legislative Provisions.. 6 C. The Court s $1 Million Sanction Was Not Excessive and Did Not Violate Due Process 9 1. Gore Guidepost 1: The Reprehensibility of Plaintiffs Conduct Gore Guidepost 2: The Ratio Between the Penalty and the Actual Harm Suffered by Rauhauser Gore Guidepost 3: The Relative Severity of Civil or Criminal Penalties for Comparable Misconduct 14 D. The Court Did Not Abuse Its Discretion By Ordering Plaintiffs to Publicly Apologize..15 E. Why the Sanctions Ordered Were Necessary to Deter Plaintiffs Scorched-Earth SLAPP-Suit Tactics.. 17 F. Plaintiffs Red Herrings and Misrepresentations to the Court Regarding the Alleged Retzlaff Conspiracy 19 G. Plaintiffs Position Regarding Anti-SLAPP Statutes Has Changed Now That the Shoe is on the Other Foot 24 II. CONCLUSION & PRAYER 25 Rauhauser s Response and Objection to Plaintiffs Motion for New Trial ii

3 NO JAMES MCGIBNEY and VIAVIEW, INC., Plaintiffs, v. THOMAS RETZLAFF, LORA LUSHER, JENNIFER D ALLESANDRO, NEAL RAUHAUSER, MISSANNONEWS, and JANE DOES 1-5, Defendants IN THE DISTRICT COURT OF TARRANT COUNTY, TEXAS 67 th JUDICIAL DISTRICT RAUHAUSER S RESPONSE AND OBJECTION TO PLAINTIFFS UNSWORN MOTION FOR NEW TRIAL I. ARGUMENT & AUTHORITIES A. Plaintiffs Are Not Entitled to an Oral Hearing on Their MNT 1. Plaintiffs ask for a new trial because of what they characterize as new evidence. MNT, 27. Therefore, plaintiffs must also show: (i) (ii) (iii) (iv) the new evidence has come to their knowledge since the trial; plaintiffs failure to discover the evidence sooner was not due to a lack of diligence; the evidence is not cumulative; and the evidence is so material it would probably produce a different result if a new trial were granted. Waffle House Inc. v. Williams, 313 S.W.3d 796, 813 (Tex. 2010); Marvelli v. Alston, 100 S.W.3d 460, 483 (Tex. App. Fort Worth 2003, pet. denied). Plaintiffs abjectly fail to make the required showings. Rauhauser s Response to Plaintiffs Motion for New Trial 1

4 2. First, plaintiffs attempt to assassinate the character of Rauhauser s counsel with bizarre and scurrilous accusations is hardly new evidence. To the contrary, plaintiffs new evidence shows on its face that plaintiffs were in possession of most of the information long before trial. 1 Plaintiffs argue that: (i) (ii) (iii) (iii) At least some of the pleadings attributed to opposing counsel Jeffrey Dorrell were actually drafted or co-drafted by non-party, non-attorney, Thomas Retzlaff. Dorrell intends to split his contingency fee with Thomas Retzlaff in exchange for Retzlaff s assistance in this case. This [case] was one in a planned series of litigation schemes meant to bait the victim of defamatory speech into filing an unwinnable lawsuit and then obtaining a windfall fee award under the TCPA. Rauhauser has not actually incurred any fees in this case. MNT Rauhauser denies plaintiffs bizarre assertions under oath below. 1 Plaintiffs new evidence consists of Exhibit A, an April 28, 2014, to plaintiffs own counsel; Exhibit B, a purported December 9, 2015, affidavit of Brittany Retzlaff with several much older sub-exhibits; Exhibit C, an exchange with an Idaho sheriff on November 24-25, 2015; Exhibit D, a November 5, 2015, to plaintiffs own counsel; Exhibit E, correspondence with a San Antonio attorney on October 13 and 15, 2015, and the attorney s motion to withdraw as counsel filed October 8, 2015; Exhibit F, the December 15, 2015, affidavit of plaintiff James McGibney with several much older sub-exhibits; Exhibit G, nonparty Thomas Retzlaff s May 5, 2004, Agreement to Mandated Registration as a Sex Offender; Exhibit H, a July 29, 2014, transcript from a hearing in one of the other defamation SLAPP-suits plaintiffs filed in California; Exhibit I, an undated screen capture of personal information of attorney Lorne Berkely; Exhibit J, an undated screen capture of the CEO of Rosendin Electric with his grandchildren; Exhibit K, an undated screen capture of an alleged posting on an Internet website; Exhibit L, a December 30, 2015, purporting to be from Thomas Retzlaff; Exhibit M, the November 9, 2015, affidavit of plaintiffs attorney Mark Traynor; Exhibit N, a December 30, 2015, screen capture of someone purporting to be Tom Retzlaff discussing the Court s anti-slapp judgment; Exhibit O, an undated screen capture of an unidentified person apparently bragging about not intending to follow an unidentified court s orders; Exhibit P, a December 30, 2015, purporting to be from Thomas Retzlaff to an unidentified recipient discussing the Court s anti-slapp judgment; Exhibit Q, the December 30, 2015, affidavit of plaintiffs attorney Evan Stone; Exhibit R, November 6, 2015, correspondence between plaintiffs counsel and the Court; Exhibit S, an undated screen capture from an unidentified author that mentions both Thomas Retzlaff and Rauhauser attorney Dorrell; and Exhibit T, a March 10, Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 2

5 3. Second, even the so-called evidence that is new falls far short of being so material that it would likely produce a different result if a new trial were granted. 4. Third, plaintiffs make no showing of diligence or that plaintiffs socalled new evidence was unavailable at the time of trial. 5. Plaintiffs failure to make the required showings is fatal to their request for an oral hearing. If a movant for new trial fails to make the required showings, the trial court is not required to hold an oral hearing on the motion for new trial. Neyland v. Raymond, 324 S.W.3d 646, 653 (Tex. App. Fort Worth 2010, no pet.); Marvelli, 100 S.W.3d at 483. In Neyland, the appellant argued that the trial court abused its discretion by failing to hold a hearing on his motion for new trial and by denying his motion despite the new evidence submitted with it. Neyland, 324 S.W.3d at Noting that the motion for new trial did not explain why the evidence was not presented before trial, the Neyland court wrote: The trial court was not required to hold a hearing on [Neyland s] motion, and it therefore did not abuse its discretion by ruling on the motion without a hearing. Neyland, 324 S.W.3d at 653. hearing on plaintiffs motion. Rauhauser objects to the Court s holding an oral Nor are plaintiffs allowed to cure their fatal omissions now , screen capture from an unidentified source vaguely referring to this guy s gate code. 2 An amended motion for new trial is timely only if filed within 30 days of the judgment. In re Brookshire Grocery Co., 250 S.W.3d 66, (Tex. 2008). The date of the judgment in the case at bar is December 30, A motion for new trial filed more than 30 days after the judgment was signed is void and cannot be considered. See Equinox Enters. v. Associated Rauhauser s Response to Plaintiffs Motion for New Trial 3

6 B. The Court s Local Rules Do Not Create Due Process Rights That Would Not Otherwise Exist 5. In asking the Court for an emergency stay of the Court s December 30, 2015, order awarding mandatory TCPA attorney s fees and sanctions, plaintiffs contended: Plaintiffs procedural due process rights were violated when the Court ruled on Defendant s motion without first granting Plaintiffs the oral hearing they requested. Emergency Motion for Stay, p.1. Plaintiffs similarly contend in their motion for new trial. MNT, 25. This is incorrect for at least two reasons. 1. Procedural Due Process Does Not Require an Oral Hearing 6. First, the Texas Supreme Court has consistently rejected the argument that due process requires an oral hearing. Cire v. Cummings, 134 S.W.3d 835, (Tex. 2004). The Cire holding is particularly significant in view of the fact that the rule at issue in Cire specifically requires notice and hearing before sanctions are imposed. See TEX. R. CIV. P ; Cire, 134 S.W.3d at 843. But the hearing required by Rule need not be an oral hearing to satisfy due process. Cire, 134 S.W.3d at ; see also Gulf Coast Inv. Corp. v. Nasa Bus. Ctr., 754 S.W.2d 152, 153 (Tex. 1988) ( Not every hearing called for under every rule of civil procedure necessarily requires an oral hearing. ). Media Inc., 730 S.W.2d 872, 875 (Tex. App. Dallas 1987, no writ). Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 4

7 [F]or some years now both the Legislature and [the Texas Supreme Court] have discouraged oral presentation of testimony and evidence when they can fairly be submitted in writing. Michiana Easy Livin Country, Inc. v. Holten, 168 S.W.3d 777, 782 (Tex. 2005). 7. If no oral hearing is required even under rules that expressly require notice and hearing, then certainly due process cannot be offended by a Court s holding no oral hearing under the TCPA especially since the TCPA contemplates no oral hearing at all. TEX. CIV. PRAC. & REM. CODE (a); Pena v. Perel, 417 S.W.3d 552, 556 (Tex. App. El Paso 2013, no pet.). 8. Plaintiffs due process argument depends for its validity entirely upon a self-invented theory that is disconsonant with the TCPA and which has been rejected by the Texas Supreme Court for at least 28 years. Plaintiffs fail to cite any contrary authority. None exists. Plaintiffs fail to show that Rauhauser s cited authorities are distinguishable. They are not. Plaintiffs choose instead to simply ignore the substantial weight of legal authority against them. This is whistling past the graveyard. Plaintiffs lose. Rauhauser s Response to Plaintiffs Motion for New Trial 5

8 2. This Court s Local Rules Cannot Create a Due Process Right That Trumps Controlling Authority and Legislative Provisions 9. Ignoring the significant holdings of the Texas Supreme Court on this issue, plaintiffs in their emergency motion for stay instead relied upon a 38- year-old Texarkana appellate decision, Jack Adams Aircraft Sales, Inc. v. Hurley, 569 S.W.2d 599, 601 (Tex. Civ. App. Texarkana 1978, writ ref d n.r.e.), to argue that they were entitled to rely on the local rules. Plaintiffs Emergency Motion for Stay, p.1. 3 In addition to being noncontrolling authority in this jurisdiction, Jack Adams does not fairly support the proposition for which plaintiffs cite it. In Jack Adams, a default judgment was set aside because a defendant s failure to appear for trial was caused by the plaintiff s violation of a Dallas Civil Court Rule that required the plaintiff to give the defendant notice of the trial setting. Id. The Jack Adams facts are a far cry from those at issue here. 10. Unlike in Jack Adams, this Court did not enter a default judgment against plaintiffs because they failed to appear for trial. Unlike in Jack Adams, Rauhauser did not violate any local rule or, by doing so, deprive plaintiffs of the ability to present a meritorious defense. Instead, plaintiffs had more than 30 days notice of the written submission of Rauhauser s motion for an award of TCPA 3 In the instant motion for new trial, plaintiffs also attack Court coordinator Becky Holland, whom plaintiffs counsel repeatedly lectured in a series of early-november s appended as evidence to their MNT: Local rules state simply that hearings should be requested from the Court Coordinator. MNT 25 and Exhibit R. Plaintiffs now complain that the Court abused its discretion by its refusal to rule on Rauhauser s request for a ruling by written submission. MNT, 26. Of course, the Court did rule on Rauhauser s request when the Court set Rauhauser s motion to award TCPA attorney s fees for a ruling by written submission on December 2, Plaintiffs simply did not like the Court s ruling and chose to ignore it. Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 6

9 attorney s fees and sanctions. Thus unlike in Jack Adams plaintiffs chose not to file a response. 11. In the 58 days Rauhauser s motion for an award of TCPA attorney s fees and sanctions remained pending, plaintiffs filed no affidavit controverting the amount of Rauhauser s attorney s fees or sanctions requested. Yet, plaintiffs now wring their hands in anguish because they were preparing for an oral hearing while waiting for the Court to affirm that plaintiffs are entitled to one. MNT, 26. Perhaps plaintiffs should not have so arrogantly presumed that they could dictate to the Court how to control its docket. The fact that they did so presume incorrectly and to their own detriment does not now entitle plaintiffs to a doover. 12. Furthermore, the Court s local rules in this respect are hardly the guarantee that plaintiffs claim they are. Plaintiffs overlook this: 1. MOTION PRACTICE A. Written Submission Only The Court prefers that motions be set for written submission if possible. Rule 1(A), Local Rules of the 67 th District Court. This Court s courtesy of typically granting oral hearings upon request is not a rule imposed by some higher authority it is the Court s own policy. As such, the Court may alter it at any time at will. The Court s local rules appear to have been last revised on June 25, 2010 approximately a year before the TCPA was adopted. Even if the Rauhauser s Response to Plaintiffs Motion for New Trial 7

10 Court s local rule can be read as plaintiffs argue, such a rule could not trump the express provisions of a statute adopted after the local rule. The TCPA states: In determining whether a legal action should be dismissed under this chapter, the court shall consider the pleadings and supporting and opposing affidavits stating the facts on which liability or defense is based. TEX. CIV. PRAC. & REM. CODE (a). At least one court has held this to mean an oral hearing is not allowed by the TCPA. Pena, 417 S.W.3d at 556. See also TCPA (policy and express purpose of TCPA are to protect the exercise of constitutional rights by cost-effective means). Holding the equivalent of a trial on TCPA attorney s fees and sanctions with subpoenas, witnesses, and cross-examination would hardly have been cost-effective. 13. A trial court abuses its discretion if it fails to analyze or apply the law correctly, In re Cerberus Capital Mgmt., L.P., 164 S.W.3d 379, 382 (Tex. 2005), or when it acts in an arbitrary or unreasonable manner or without reference to any guiding rules and principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, (Tex. 1985). The Court correctly decided Rauhauser s motion for an award of TCPA attorney s fees and sanctions without an oral hearing. Because plaintiffs chose not to file controverting affidavits or evidence either before the scheduled December 4, 2015, submission date or after it the Court ruled on the basis of the only evidence before it. This was not an abuse of the Court s discretion. Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 8

11 C. The Court s $1 Million Sanction Was Not Excessive and Did Not Violate Due Process 14. Plaintiffs dramatically aver that the $1,000,000 SLAPP sanction is the largest in United States history. MNT, 24. While the Court s sanction may be the largest thus far in the short history of the TCPA, it pales in comparison to other, larger sanctions meted out in other states on similar facts: (i) (ii) (iii) On May 10, 1991, Linda Tanner was awarded $86.6 million in damages by a St. Louis, Missouri, court against a Canadian conglomerate who sued her for $1 million for libel in Decom Medical Waste Systems v. Tanner. 4 Tanner lived near the site of an infectious-waste incinerator operated by Decom and wrote letters to local newspapers criticizing the incinerator. Id. Tanner said Decom officials inquired at the hospital where she worked about her certification, accused her of stealing telephone time from the hospital, and wrote letters to state senators, the governor, and the attorney general referring to her as an unbalanced fanatic and implied she was involved in some kind of criminal activity. Id. In 1988, Ken Wegis and two other farmers, Jack and Jeff Thompson, were awarded $13.5 million in damages on their SLAPP counterclaim by a Kern County, California, court against farming giant J. G. Boswell Co. for bringing an unwarranted libel suit. 5 In 1986, Raymond Leonardini, was awarded $5.197 million in damages against Shell Oil because Shell sued him for defamation in a California federal court to intimidate him from revealing a test that concluded that polybutylene pipes may be a health hazard. 6 Plaintiffs hyperbolic implication that the Court has sailed recklessly into uncharted juridical waters is unwarranted. 4 5 See St. Louis Post-Dispatch, May 14, 1991; Reynolds County Courier, May 23, See Los Angeles Times, July 16, 1988, last accessed January 5, See Los Angeles Times, April 24, 1986, _1_polybutylene-pipes, last accessed January 5, Rauhauser s Response to Plaintiffs Motion for New Trial 9

12 15. The Due Process Clause prohibits grossly excessive punishments on tortfeasors. BMW of North America, Inc. v. Gore, 517 U.S. 559, 562 (1996). In Gore, the U.S. Supreme Court held that punitive damages of 500 times actual damages violated Due Process. Id. at 582, 585. In reaching its decision, the Gore court set forth three guideposts for lower courts to use in determining whether a sanction is excessive under the Due Process clause: (i) (ii) (iii) the reprehensibility of the defendant s conduct; the ratio between the penalty and the actual harm suffered by the plaintiff; and the relative severity of civil or criminal penalties imposed for the defendant s transgressions or comparable misconduct. Gore, 517 U.S. at The Gore guideposts are analyzed in turn below. 1. Gore Guidepost 1: The Reprehensibility of Plaintiffs Conduct 16. Perhaps the most important indicium of the reasonableness of punitive damages is the degree of reprehensibility of the defendant s conduct. Gore, 517 U.S. at 575. While reprehensibility is a subjective standard, plaintiffs two-state, scorched-earth SLAPP campaign in three jurisdictions against the same defendants based on the same facts is sufficiently reprehensible conduct in and of itself especially given that the stated purpose of the mandatory TCPA sanction is to deter plaintiffs from filing similar lawsuits in the future. 17. But there is more. Plaintiff James McGibney taunted and threatened Rauhauser s counsel in an attempt to deprive Rauhauser of legal representation. Already of record in the case at bar are messages such as the following: Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 10

13 Rauhauser s Response to Plaintiffs Motion for New Trial 11

14 18. Plaintiffs two-pronged response in the instant motion for new trial to Rauhauser s November 9, 2015, evidence of reprehensibility never controverted by plaintiffs before judgment was rendered on December 30, 2015 is that: (i) (ii) Rauhauser failed to prove that the foregoing statements were made by James McGibney (despite the prominent Bullyville logo on the Tweet, the Twitter and the name James McGibney emblazoned on the Tweet); and Rauhauser failed to prove that the Jeff named in McGibney s posts was Rauhauser counsel Jeffrey L. Dorrell (since McGibney avoided using counsel s last name or referring to the firm of Hanszen Laporte). MNT, 5-6. Plaintiffs so-called new evidence that McGibney never made that statement is not only untimely but spectacularly unpersuasive. It requires the Court to believe either that there is some other James McGibney who has a grudge against Rauhauser counsel Jeffrey L. Dorrell or that James McGibney has a grudge against some other Jeff besides Rauhauser s counsel. 19. Plaintiffs insult the Court s intelligence with an argument on a par with a seventh-grader s excuse that the dog ate my homework. The Court is not required to act as a credulous, wayfaring fool, accepting all statements proffered from any source as having equal credibility. Plaintiffs dog-ate-my-homework excuses are far from evidence so material it would probably produce a different result if a new trial were granted. The Court s $1 million sanction easily survives scrutiny under the first Gore guidepost. Plaintiffs lose. Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 12

15 2. Gore Guidepost 2: The Ratio Between the Penalty and the Actual Harm Suffered by Rauhauser 20. The principle that exemplary damages must bear a reasonable relationship to compensatory damages is said to have a long pedigree. Gore, 517 U.S. at 580. Although the Constitution does not require any simple mathematical formula, Id. at 582, the Gore court noted that some 65 different enactments from 1275 to 1753 provided for double, treble, or quadruple punitive damages. Id. at 581. The $2 million sanction held to be constitutionally infirm in Gore was based on economic damages of only $4, times the amount of actual harm. Id. at By contrast, plaintiffs scorched-earth SLAPP-suit campaign in the case at bar caused Rauhauser to incur in excess of $300,000 in attorney s fees to defend. Thus, the $1 million sanction is slightly more than three times Rauhauser s actual damages. Furthermore, the Court should consider whether there is a reasonable relationship between the punitive damages award and the harm likely to result from [plaintiffs ] conduct. TXO Production Corp. v. Alliance Resources Corp., 509 U.S. 443, 460 (1993) [emphasis in original]. The TXO court relied upon the harm that would have befallen the victim if the tortious plan had succeeded. Id. at 462. In the case at bar, that harm is $1 million the precise amount for which plaintiffs sued Rauhauser in their defamation SLAPPsuit. The Court s $1 million sanction easily survives scrutiny under the second Gore guidepost. Plaintiffs lose again. Rauhauser s Response to Plaintiffs Motion for New Trial 13

16 3. Gore Guidepost 3: The Relative Severity of Civil or Criminal Penalties for Comparable Misconduct 22. A reviewing court determining whether a sanction is excessive should accord substantial deference to legislative judgments concerning appropriate sanctions for the conduct at issue. Gore, 517. U.S. at 583. Thus: Comparing the punitive damages award and the civil or criminal penalties that could be imposed for comparable misconduct provides a third indicium of excessiveness. Id. In Gore, the court compared the maximum penalty under Alabama s DTPA statute $2, to the $2 million in exemplary damages at issue and observed that the $2 million award was substantially in excess of the statutory fines available in Alabama and elsewhere for similar malfeasance. Id. at 584. Thus, the Gore court held the $2 million sanction against BMW excessive. Id. 23. The TCPA has no analog in common law or statutes, so there is no other civil or criminal penalty to which to compare the Court s $1 million sanction. The TCPA offers the only remedy available. The sole purpose of the TCPA sanction is to deter future conduct. TEX. CIV. PRAC. & REM. CODE A deterrent sanction is mandatory under the TCPA and was specifically ordered by the court of appeals when it remanded the case to this Court. Although large, the Court s $1 million sanction does not jar one s constitutional sensibilities. See TXO, 509 U.S. at 462. The Court $1 million sanction easily survives scrutiny under the third Gore guidepost. Plaintiffs lose yet again. Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 14

17 D. The Court Did Not Abuse Its Discretion By Ordering Plaintiffs to Publicly Apologize 24. As noted in Rauhauser s earlier briefing, for many years before adoption of the TCPA, both state and federal courts have recognized the need for a judge to be able to award non-monetary sanctions in the proper case. Courts have the widest possible latitude to fashion these. A court may award any creative non-monetary sanction that it considers just. See Braden v. S. Main Bank, 837 S.W.2d 733, 736 (Tex. App. Houston [14th Dist.] 1992, writ denied) (upholding sanction requiring attorney to perform 10 hours of community service for drafting unreasonably frivolous interrogatory answers); see also Braden v. Downey, 811 S.W.2d 922, 930 (Tex. 1991) ( [W]e do not criticize this type of creative sanction [ordering attorney to perform community service]. ) 7 ; see, e.g., Sec. Nat l Bank of Sioux City v. Abbott Labs., 2014 WL , at *15 (N.D. Iowa July 28, 2014) (requiring attorney to produce training video as sanction for deposition misconduct). A creative nonmonetary sanction may either protect the victim, penalize the actor, or both. 25. American courts have taken to the idea of coerced apology with gusto, using apology mostly as a shaming mechanism. 8 Reports abound in the media of judges requiring defendants to apologize as a condition of receiving 7 Downey and South Main Bank were consolidated cases. See Downey, 822 S.W.2d at 924, n.1. 8 See generally Elizabeth Latif, Note, Apologetic Justice: Evaluating Apologies Tailored Toward Legal Solutions, 81 B.U. L. REV. 289, (2001) (describing several such reports including one about an Ohio judge who ordered three men to publicly apologize for disorderly conduct and a Texas judge who ordered a teenager to apologize to students for vandalizing their Rauhauser s Response to Plaintiffs Motion for New Trial 15

18 probation rather than incarceration. 9 Examples range from judges ordering drunk drivers to take out newspaper ads apologizing to the community, 10 to requiring batterers to apologize to their spouses before women s groups, 11 to ordering corporate polluters to write letters of apology for their environmental crimes and pay for newspaper advertisements detailing their conduct. 12 When defendants refuse to cooperate in such coerced expressions of remorse they risk the wrath of the court. For example, a federal judge in Hawaii sent a former city councilman back to prison, rather than to a halfway house, after the former city councilman refused to apologize to the community for misusing public funds Like family abuse victims, those who have been devalued and belittled experience a variety of psychological distresses, including anxiety, anger, and powerlessness. Apologies facilitate recovery from this distress by restoring the victim s dignity through a symbolic transfer of humiliation and power between the offender and the victim. 14 This is why their use as a judicial remedy has grown. schools (2000). 11 See, e.g., id. See Daniel W. Shuman, The Role of Apology in Tort Law, 83 JUDICATURE 180, 187 See, e.g., Haya El Nasser, Paying for Crime With Shame: Judges Say Scarlet Letter Angle Works, USA TODAY, June 25, 1996, at A1; see also Thomas M. Antkowiak, Note, Truth as Right and Remedy for International Human Rights Experience, 23 MICH. J. INT L L. 977, (2002) (noting several instances of judge-ordered apology in the context of a discussion of the benefits of systematically incorporating restorative principles in the U.S. criminal justice system). 12 See Dan M. Kahan & Eric A. Posner, Shaming White-Collar Criminals: A Proposal for Reform of the Federal Sentencing Guidleines, 42 J. L. & ECON. 365, 367 (1999) (citing Richard Phillips, Shame as a Deterrent, CHI. TRIB., July 27, 1988 at C20). 13 See KITV News, The Hawaii Channel (ABC television broadcast May 16, 2005). 14 See AARON LAZARE, ON APOLOGY, at 44 (2004) (discussing the growing importance of public and private apologies in American culture). Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 16

19 E. Why the Sanctions Ordered Were Necessary to Deter Plaintiffs Scorched-Earth SLAPP-Suit Tactics 27. Although plaintiffs never filed evidence of assets or net worth before the Court entered judgment on December 30, 2015, now over three months after Rauhauser s motion to award TCPA attorney s fees and sanctions was filed plaintiffs complain that the Court s $1 million sanction is entirely disproportionate to the size of plaintiffs business and the amount of plaintiffs assets. MNT 24. To argue that the Court s sanction is unnecessary to deter plaintiffs from filing similar lawsuits in the future, plaintiffs cynically offer up McGibney s word that he will never file another defamation suit in Texas. Id., and McGibney affidavit 7. Again, plaintiffs insult the Court s intelligence. 28. McGibney routinely sues Texas residents for defamation in other states. For example, McGibney sued Retzlaff, Rauhauser, and most of the same defendants named in the instant case in Cause No. 5:14-CV-01059; McGibney v. Retzlaff; in the U.S. District Court for the Northern District of California. Plaintiffs continued feverishly litigating their federal defamation SLAPP-suit against Texas resident Retzlaff for 15 months, when the court finally dismissed it on June 18, See, 2015 U.S. Dist. LEXIS (N.D. Cal. 2015), Exhibit 4. Undeterred by the federal court s ruling that California could not exercise personal jurisdiction over Retzlaff, id., plaintiffs continue feverishly litigating their third suit against Retzlaff to this day. See Cause No. Cause No. 114CH005460; ; in the Superior Court of Santa Rauhauser s Response to Plaintiffs Motion for New Trial 17

20 Clara County, California (presently stayed by the California court of appeals pending disposition of Retzlaff s petition for writ of mandamus). Against the backdrop of these facts, one visualizes McGibney making his solemn vow with his fingers crossed behind his back. 29. As to plaintiffs MNT s suggestions (not evidence) of penury, plaintiffs cannot present new evidence during a hearing on an unsworn motion for new trial that plaintiffs strategically chose not to present to the Court before judgment was rendered. Even now, plaintiffs only vaguely allude to the Court s sanction as disproportionate to the size of plaintiffs business. Yet, plaintiffs selectively omit facts such as the following: (i) (ii) On February 6, 2012, Radaronline.com 15 reporter Amber Goodhand reported that James McGibney, founder of Cheaterville.com, the go-to website to find photos and information on philandering lovers, had drafted a bid for the city of Bucyrus, Ohio, to rename their city Cheaterville for $1 million. Exhibit 5. On May 6, 2013, during oral testimony to the Nevada State Assembly s Judiciary Committee, 16 which was considering an anti- SLAPP statute, McGibney testified in favor of Nevada s adopting such a statute and mentioned that ViaView was a company that makes a few million dollars a year. Exhibit 6, p.6. Rauhauser does not repeat plaintiffs judicial admissions as to wealth and assets that were before the Court in Rauhauser s motion to award TCPA attorney s fees and sanctions. The Court s sanction was necessary to deter plaintiffs last accessed on February 2, last accessed on February 2, Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 18

21 F. Plaintiffs Red Herrings and Misrepresentations to the Court Regarding the Alleged Retzlaff Conspiracy 30. Plaintiffs spill much ink conjecturing about an elaborate conspiracy between Rauhauser s counsel, Jeffrey L. Dorrell, and former defendant Thomas Retzlaff. Plaintiffs boast that their allegations about Rauhauser are established by Retzlaff s own admissions. MNT 21, 24 [emphasis added]. Plaintiffs socalled new evidence consists of a series of somewhat self-aggrandizing s from Retzlaff to his estranged daughter, in which Retzlaff claims: o to have drafted pleadings and motions in this case as to which plaintiffs allege Dorrell presented false evidence to the Court to support the claim for Rauhauser s TCPA attorney s fees; (MNT 9); o to have signed the checks to pay Rauhauser s attorney s fees in this case (Id. and supporting exhibits); o to be entitled to an agreed share of any attorney s fees and sanctions collected from plaintiffs in this case (Id.); o to have been secretly listening to a telephonic hearing in which the only participants were supposed to be counsel and this Court (MNT 10); and, o perhaps most bizarrely, that Retzlaff and Dorrell deliberately baited the unsuspecting McGibney into filing this defamation SLAPP-suit for the express purpose of litigating a TCPA claim for attorney s fees and sanctions. (MNT 21). Plaintiffs forget that the so-called Retzlaff admissions do not bind Rauhauser or his counsel. See TEX. R. CIV. P (an admitted matter is conclusively established as to the party making the admission ) [emphasis added]. Plaintiffs speculations based on the Retzlaff claims are categorically denied by witnesses who have actual knowledge of the facts. Exhibits 1-3. Rauhauser s Response to Plaintiffs Motion for New Trial 19

22 31. Plaintiffs subtly bolster their conspiracy theory by peppering their diatribe with references to Retzlaff and Rauhauser (MNT 15) even though there has never been a scintilla of evidence that Rauhauser and Retzlaff were linked. Plaintiffs also cynically refer to opposing counsel s associate, Thomas Retzlaff (MNT 16) an allegation supported by nothing but Retzlaff s s. 32. Not satisfied with that, plaintiffs brazenly misrepresent material facts to the Court to argue that Retzlaff has a working relationship with Rauhauser s legal counsel that allows Retzlaff to be privy to legal strategies beforehand: [Retzlaff s] voic [left for the CEO of McGibney s employer, Rosendin Electric, advising that McGibney admitted to hacking into the accounts of Rauhauser s counsel 17 and put child porn on the attorney s computers] is remarkable because the voic was left on November 30, 2015, which was before any pleadings were filed that made mention of the new claim of Plaintiff McGibney s having inserted pedophilic material into Hanszen Laporte s system. MNT [emphasis added]. As the Court s files easily confirm, this is false. Rauhauser filed a Notice of Plaintiffs New Criminal Aggravating Misconduct and Request for Non-Monetary TCPA Sanctions on November 9, days before Retzlaff s November 30, 2015, voic . In that filing, Rauhauser states: The Court can take judicial notice that it might be possible for hacker McGibney to manufacture evidence by inserting exogenous data, software, or images into the files of Hanszen Laporte s compromised computers for purposes of making it appear that the items originated there. McGibney now threatens to do this to Rauhauser s attorneys, if he has not already done so. Rauhauser s Notice of Plaintiffs New Criminal Aggravating Misconduct, Retzlaff s voic actually appears to refer to Rauhauser s counsel as the attorney representing me in Houston. If so, this is incorrect. Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 20

23 In support, Rauhauser produced the following McGibney Tweets from November 7, 2015: Rauhauser s Response to Plaintiffs Motion for New Trial 21

24 Obviously, Retzlaff (as well as any other member of the public) would have had access to Rauhauser s November 9, 2015, filing from public records for 3 full weeks at the time he left a voic for McGibney s employer not from secret strategy meetings with Dorrell on how to make plaintiffs lives miserable. 33. Nor is there any truth to plaintiffs speculation that Rauhauser s counsel uses Retzlaff as a surrogate to attack opposing counsel or parties. The Dorrell affidavit appended to this response establishes the following key facts, most of which are corroborated by the affidavits of Hanszen Laporte s managing partner and accounting personnel: (i) (ii) (iii) (iv) (v) (vi) When plaintiffs filed the instant case on February 19, 2014, Dorrell had never met or heard of defendant Neal Rauhauser. Exhibit 1, 6. Dorrell did not bait plaintiff James McGibney or plaintiff ViaView, Inc., into filing the instant lawsuit. Id., 9. When plaintiffs filed the instant case on February 19, 2014, Dorrell had never met or heard of defendant Thomas Retzlaff. Id., 7. When plaintiffs filed the instant case on February 19, 2014, Dorrell had never met or heard of either McGibney or ViaView, Inc. Id., 8. Neither Hanszen Laporte nor Dorrell has ever represented or agreed to represent defendant Retzlaff in any legal matter of any kind or nature whatsoever at any time. Id., 10; Exhibit 2, 3. Retzlaff has not paid, agreed to pay, or ever been asked to agree to pay, any amount of money to Hanszen Laporte or Dorrell for Neal Rauhauser s attorney s fees, expenses, or anything else at any time. Exhibit 1, 11; Exhibit 2, 7; Retzlaff is not entitled to any amount of money that may ever be collected from plaintiffs as a result of any order of the Court in this (or any other) case Exhibit 1, 12. (vii) Retzlaff has never been to the offices of Hanszen Laporte. Id., 13. Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 22

25 (viii) Dorrell has met Retzlaff only two times in his life in court and in connection with the instant case. Id., 14. (ix) (x) (xi) Dorrell has never permitted Retzlaff to audit any telephonic hearing before this Court in which Dorrell was participating, whether by secret participation on a conference call or by allowing him to be present in my office while Dorrell was on the phone with the Court. Id., 15. Retzlaff has not performed any legal work or drafted any motions, pleadings, or briefs on behalf of Rauhauser in the instant case. Retzlaff has never reviewed and approved any motion, pleading, or other filing Dorrell has made on behalf of Rauhauser in this case. Id., 16. Retzlaff is not now, and never has been, Dorrell s client, agent, associate, surrogate, partner, confederate, co-conspirator, or anything else. Dorrell has no relationship with Retzlaff apart from the fact that the plaintiffs in this suit sued both Retzlaff and Neal Rauhauser, in both the instant case and in Cause No. 5:14-CV ; ; in the U.S. District Court for the Northern District of California. It is hardly remarkable that two codefendants in parallel defamation SLAPP-suits brought and maintained by the same plaintiffs based on the same facts in two different states at the same time would occasionally have an interest in and communication with each other regarding the common issues in the two suits. Id., Even if the Court were to assume that plaintiffs elaborate theory of a dark conspiracy between Retzlaff and Rauhauser s counsel were true, it is unclear how this would change the facts that (i) plaintiffs chose not to present evidence before judgment was rendered; and (ii) the post-judgment evidence plaintiffs now proffer is not, in fact, new. The Court should deny plaintiffs motion for new trial. Rauhauser s Response to Plaintiffs Motion for New Trial 23

26 G. Plaintiffs Position Regarding Anti-SLAPP Statutes Has Changed Now That the Shoe is on the Other Foot 35. Although perhaps of only tangential relevance to the instant motion, it is interesting to see how much plaintiffs position regarding anti-slapp legislation has changed after plaintiffs started filing defamation SLAPP-suits. Now decrying the injustice of TCPA sanctions that may bankrupt plaintiffs, 18 plaintiffs once advocated stronger remedies in anti-slapp statutes. During oral testimony to the Nevada State Assembly s Judiciary Committee 19 considering strengthening Nevada s anti-slapp statute, McGibney testified in favor of the changes. Exhibit 6, pp.6-7. McGibney also wrote this to the Committee: The proposed amendments to Nevada s current anti-slapp laws found in SB 286 provide a powerful method for ViaView (and other companies) to grow without fearing the costs of a frivolous lawsuit. As a result, when faced with frivolous litigation for its First Amendment-protected activity ViaView would be able to recover its costs and attorney s fees from the person who brought the action. Strong anti-slapp statutes like those in California and Washington have helped protect [victims] in those states from all kinds of frivolous, wasteful lawsuits that attempt only to target those companies lawful and First Amendment-protected activities. Exhibit 7. McGibney warned of the specter of financial ruin in the form of a lawsuit brought to punish Fist (sic) Amendment-protected activities. Id. 36. Now, apparently, plaintiffs believe it is all right for Rauhauser to suffer the specter of financial ruin because McGibney has promised never to do it again (but only in Texas). McGibney s hypocrisy is astounding 18 Plaintiffs make this argument only in their Emergency Motion for Stay, 9. It appears nowhere in plaintiffs motion for new trial last Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 24

27 II. CONCLUSION & PRAYER 37. For these reasons, Rauhauser asks the Court to deny plaintiffs motion for new trial without conducting an oral hearing on the motion. Rauhauser requests such other and further relief, at law or in equity, as to which he shall show himself justly entitled. Respectfully submitted, By: /s/ Jeffrey L. Dorrell. Jeffrey L. Dorrell State Bar No Philip A. Meyer State Bar No Katy Freeway, Suite 850 Houston, Texas Telephone: FAX: ATTORNEYS FOR DEFENDANT NEAL RAUHAUSER accessed on February 2, Rauhauser s Response to Plaintiffs Motion for New Trial 25

28 CERTIFICATE OF SERVICE I hereby certify that on 2-2, 2016, a true and correct copy of the foregoing was sent by: X Hand delivery Certified mail Telephonic document transfer E-service in accordance with TEX. R. CIV. P. 21a to the following counsel of record: Mr. Evan Stone evan@stonevaughanlaw.com Stone & Vaughan, PLLC 624 W. University Drive, Suite 386 Denton, Texas Telephone: FAX: COUNSEL FOR PLAINTIFFS /s/ Jeffrey L. Dorrell JEFFREY L. DORRELL Rauhauser s Response and Objection to Plaintiffs Motion for New Trial 26