36 - motion to strike

7/29/2019 36 - Motion to Strike

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Quarles & Brady LLPFirm State Bar No. 00443100

Renaissance One, Two North Central Ave.Phoenix, AZ 85004-2391TELEPHONE 602.229.5200

John S. Craiger (#021731)[email protected] E. Funkhouser III (#022449)[email protected]

Attorneys for DefendantLisa Jean Borodkin

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

XCENTRIC VENTURES, L.L.C.,Plaintiff,

v.

LISA JEAN BORODKIN and JOHN DOEBORODKIN, husband and wife; RAMONDMOBREZ and ILIANA LLANERAS,husband and wife; DANIEL BLACKERTand JANE DOE BLACKERT, husband andwife; ASIA ECONOMIC INSTITUTE,

LLC, a California limited liability company,DOES 1-10, inclusive,

Defendants.

No. 2:11-CV-01426-PHX-GMS

DEFENDANT LISA JEAN

BORODKIN'S MOTION UNDER

FEDERAL RULE OF CIVIL

PROCEDURE 12(f) TO STRIKE

PARAGRAPHS 2, 42, 44, 50 AND 51

OF THE VERIFIED COMPLAINT

(Assigned to the Honorable G. MurraySnow)

(Oral Argument Requested)

Defendant LISA JEAN BORODKIN hereby moves pursuant to Federal Rules of

Civil Procedure 1, 8(a) and 12(f) to strike paragraphs 2, 42, 44, 50, and 51 of the Verified

Complaint (Complaint) on the grounds that they are scandalous, impertinent, and

prejudicial. This Motion is based on the Memorandum of Points and Authorities filed andserved herewith, and upon the papers, records and pleadings on file herein, and

specifically without waiving other defenses under Federal Rule of Civil Procedure 12

motions for which are filed concurrently with this Motion.

Case 2:11-cv-01426-GMS Document 36 Filed 10/31/11 Page 1 of 13


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MEMORANDUM OF POINTS AND AUTHORITIES

I. PRELIMINARY STATEMENTDefendant Lisa Jean Borodkin ("Ms. Borodkin) brings this motion pursuant to

Federal Rules of Civil Procedure 1, 8(a)1

and 12(f) to strike paragraphs 2, 42, 44, 50 and

51 of the Verified Complaint (Complaint) filed by Plaintiff Xcentric Ventures, L.L.C

(Xcentric).

Generally, this is styled as an action for malicious prosecution arising out of civil

litigation in the Central District of California (the California Action). See Doc. 20

Paragraphs 2, 42, 44, 50 and 51 contain unsubstantiated and prejudicial references to

criminal conduct and violations of California Rules of Professional Conduct allegedly

committed by the defendants, two of whom are attorneys. These specific accusations of

criminal and ethical violations are based on nothing more than what Plaintiffs attorney

David Gingras, claims is a reasonable inference from the disputed facts at issue in this

action.

Under the circumstances, inclusion of such extreme and personal attacks on the

character and reputation of defendants, prior to adjudication of Xcentrics allegations, is

impertinent, scandalous and prejudicial. Accordingly, this motion should be granted.

II. SUMMARY OF RELEVANT FACTSA. References to Criminal Conduct Are Scandalous, Impertinent and

Prejudicial.

Paragraphs 2, 42, 44, 50 and 51 of the Complaint allege that the plaintiffs in the

California Action (Defendants Raymond Mobrez and Iliana Llaneras) and their counsel

1 A complaint having the factual elements of a cause of action present but scattered

throughout the Complaint and not organized into a short and plain statement of the claim

may be dismissed for failure to satisfy Rule 8(a) of the Federal Rules of Civil Procedure.

See Ortega v. Arpaio, 2006 U.S. Dist. LEXIS 59018 at *7 (D. Ariz. Aug. 15, 2006);

McHenry v. Renne, 84 F.3d 1172 (9th Cir. 1996).



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(Defendant Daniel F. Blackert and Ms. Borodkin) committed the crimes of perjury,

subornation of perjury and false swearing:

. . . Defendants engaged in a wide variety of unlawful, criminal, tortiousand unethical conduct including, but not limited to: perjury in violation of18 U.S.C. 1621, subornation of perjury in violation of 18 U.S.C. 1622,false swearing in violation of 18 U.S.C. 1623[.] (Compl. 2) (emphasisin original).

. . . Defendants MOBREZ and LLANERAS each committed perjury whenthey testified that Magedson demanded $5,000 from MOBREZ in atelephone conversation[.] (Compl. 42)

This [May 11, 2010] letter reiterated that Defendant MOBREZ andLLANERAS had committed perjury[.] (Compl. 44)

. . . Defendant further perjured himself by testifying, for the first time, Inaddition, there were a number of incoming calls to me from Ripoff Report.(Compl. 50)

. . . BORODKIN and BLACKERT intentionally suborned perjury fromMOBREZ[.] (Compl. 51)

None of the Defendants has ever been prosecuted for or convicted of the crimes of

perjury, subornation of perjury, or false swearing.

B. References to Violations of California Rules of Professional ConductAre Scandalous, Impertinent and Prejudicial.

Paragraph 2 of the Complaint alleges that Defendants (two of whom are attorneys)

committed various violations of the California ethical rules for attorneys:

. . . multiple/repeated violations of the California Rules of Professional Conductincluding but not limited to: Rule 3-200 (prohibiting a lawyer from bringing anaction or asserting any position in litigation without probable cause and for thepurpose of harassing or maliciously injuring any person); Rule 3-210 (prohibiting alawyer from advising a client to violate the law); and Rule 5-200(B) (prohibiting alawyer from misleading a court by making a false statement of fact). (Compl. 2)



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Ms. Borodkin does not have any bar record of disciplinary action, for these

allegations or otherwise.

III. LEGAL ARGUMENT.A. Motions Under Rule 12(f).Rule 12(f) of the Federal Rules of Civil Procedure provides:

(f) Motion to Strike. The court may strike from a pleading an insufficient defenseor any redundant, immaterial, impertinent, or scandalous matter. The court may act

(1) on its own; or(2) on motion made by a party either before responding to the pleading or, if a

response is not allowed, within 21 days after being served with the pleading.

See Fed. Rule. Civ. Proc. 12(f).

The function of a 12(f) motion to strike is to avoid the expenditure of time and

money that must arise from litigating spurious issues by dispensing with those issues prior

to trial. See Sidney-Vinstein v. A.H. Robins Co., 697 F.2d 880, 885 (9th Cir. 1983);

Torres v. Goddard, 2008 U.S. Dist. LEXIS 35291 at *3 (D. Ariz. Apr. 22, 2008). This

Court has inherent authority to strike from any pleading any redundant, immaterial,

impertinent or scandalous matter. See Apolinar v. Baum, 2008 U.S. Dist. LEXIS 113273

at *17 (D. Ariz. June 4, 2008). Such matter includes any allegations that unnecessarily or

irrelevantly reflect on the moral character of an individual, do not contribute to the

substantive claims, or state anything in repulsive language that detracts from the dignity of

the court. See id. at *17-18; Vesecky v. Matthews (Mill Towne Center) Real Estate

LLC, 2010 U.S. Dist. LEXIS 24928 at *4 (D. Ariz. Mar. 2, 2010).

A matter is impertinent if it consists of statements that do not pertain and are notnecessary to the issues in question. See Torres v. Goddard, 2008 U.S. Dist. LEXIS 35291

at *3 (D. Ariz. Apr. 22, 2008). The decision whether to strike material as scandalous is

within the discretion of the district court. See Talbot v. Robert Matthews Distrib. Co., 961

F.2d 654, 664-665 (7th Cir. Ill. 1992) (striking allegation that defendants conspired to



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cause fatal salmonella outbreak); Alvarado-Morales v. Digital Equipment Corp., 843 F.2d

613, 618 (1st Cir. P.R. 1988).

Improper legal terms should be stricken from pleadings. See Clark v. Goodwill

Indus. of Hawaii, 2009 U.S. Dist. LEXIS 86453, 30-31 (D. Haw. Sept. 21, 2009).

B. Paragraphs 2, 42, 44, 50 and 51 Should Be Stricken from the Complaint.

The allegations of perjury, suborning perjury and violations of California

Rules of Professional Conduct in paragraphs 2, 42, 44 and 50 should be stricken under

Rule 12(f). They are not necessary to the issues in this action. They would be

unnecessarily burdensome to answer, and would unduly prejudice the Defendants. See

Wailua Assocs. v. Aetna Cas. & Sur. Co., 183 F.R.D. 550, 556 (D. Haw. 1998) (striking

reference to siege warfare as scandalous because plaintiff could communicate same idea

in other words).

The unfounded allegations of perjury and suborning perjury in the Complaint

bear an unfortunate resemblance those in Nault's Auto. Sales, Inc. v. American Honda

Motor Co., Acura Auto. Div., 148 F.R.D. 25, 29 (D.N.H. 1993) (Terms such as

"perjury," "contempt," "liar," and "suborning of perjury" became almost routine in Nault's

pleadings.).

In Nault, as here, the defendant moved to strike, inter alia, allegations that the

defendant had committed perjury, and that its counsel had suborned perjury and

pressured a witness into signing an affidavit which it knew to contain false information.

See id., 148 F.R.D. at 33. The Court struck the allegations of perjury, suborning

perjury and other criminal conduct.In Nault, the Court specifically rejected Naults counsels claim to have acted in

subjective good faith in alleging perjury, subornation of perjury and criminal conduct:

That Nault's counsel are convinced in their own minds that the "facts" pointexclusively to one reasonable conclusion (i.e., that Honda's counsel . . . suborned



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perjury," "committed perjury," and engaged in "criminal conduct") hardlyestablishes either the truth of those charges or even that those charges wereobjectively reasonable when made. . . . none of that justifies the unsubstantiatedand extreme attacks on the personal integrity, ethics and character of defense

counsel exhibited in the challenged pleadings. The tone, the language used, and theaccusations themselves are unwarranted by the facts, either as they are presentlyknown or as they were known to plaintiffs' counsel when the challenged pleadingswere filed.

See Nault, 148 F.R.D. at 34-35 (D.N.H. 1993).

Without factual evidence, an attorneys subjective belief does not free him to

indiscriminately bludgeon the professional reputations of other attorneys:

[P]laintiffs' counsel . . . are of course free to believe whatever they choose tobelieve. They are not free to indiscriminately bludgeon the professional reputationsof opposing counsel out of frustration, or in angry overreaction, or on meresuspicion alone.

See id., 148 F.R.D. at 36.

Exactly the same conviction exists solely in the mind of Xcentrics counsel, David

Gingras. However convinced Xcentrics counsel may be that he will ultimately prevail on

the merits of his claims, that conviction does not justify the accusations in the Complaint

that Blackert and Ms. Borodkin committed the crimes of suborning perjury and

violating Californias Rules of Professional Conduct. Such an inference is insufficient

to justify scandalous allegations that irrelevantly reflect on the moral character of the

defendants. See Vesecky, 2010 U.S. Dist. LEXIS 24928 at *4.

If the evidence is consistent with two possible interpretations, scandalous

allegations of perjury, subornation of perjury and criminal conduct against opposing

counsel should be stricken from a pleading unless they are demonstrated beyond mere

suspicion:

When presented with evidence which is consistent with two possible and equallyplausible, but inconsistent, interpretations of how opposing counsel have conductedthemselves, professional courtesy and dignity militate in favor of adopting thatwhich is consistent with ethical and professional conduct, at least until the contrary



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is demonstrated beyond mere suspicion. . . . In this instance, the Court finds therewas and is no reasonable basis well grounded in fact to have warranted Nault'sallegations of perjury and subornation of perjury in the first place, and certainly nobasis for refusing to strike those allegations now. Those allegations are stricken.

Nault's, 148 F.R.D. at 34.

In this case, the evidence of Blackerts and Ms. Borodkins continuation of the

California Action is subject to the alternate explanation that they believed the case had

merit, and could be continued with the correction of any affected testimony. Xcentrics

counsel recognized that possibility in a May 11, 2010 letter, attached to the Complaint in

this action as Exhibit E ([I]t may be possible that you believe the case, or some part

thereof, may still be salvageable based on the disclosure of new or different factual

theories of some kind.). Therefore, these scandalous allegations supported only by mere

suspicion should be stricken.

Similarly, in Clark v. Goodwill Indus of Hawaii, the Court struck references to

perjury in the complaint in that action:

Each of Plaintiff's allegations of perjury are unsubstantiated . . . Perjury is a serious

offense, and allegations of perjury are scandalous accusations that may result inprejudice against Defendants. . . . Improper use of legal terms should be strickenTherefore, the Court strikes all allegations of perjury from paragraphs 27, 28, 3132, 33, 59, 62, 66, 67, and 82.

Clark v. Goodwill Indus. of Hawaii, 2009 U.S. Dist. LEXIS 86453, 30-31 (D. Haw. Sept

21, 2009). Likewise, improper use of the legal terms perjury, subornation of perjury

false swearing and recitations of the California Rules of Professional Conduct should be

stricken from the Complaint.

C. There Has Been No Finding of Perjury to Support the Allegations.

Xcentric lacks evidence supporting the serious allegations of perjury, subornation of

perjury and other crimes. Perjury requires not only proof beyond a reasonable doubt



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but also consists of willfulness and must pertain to a material fact of the case. See Chein

v. Shumsky, 373 F.3d 978, 983 (9th Cir. 2004). As no adjudication of perjury, was ever

made, the allegations of Defendants committing perjury and suborning perjury are not

only unsubstantiated but without objective factual basis.

1. There Has Been No Finding that Mobrez Acted Willfully

Specifically, there has been no finding of willfulness. To the contrary, Exhibit L

attached to Xcentrics Complaint show that there is evidence that the alleged perjury

was not willful. Mobrez stated in his corrected declaration, attached to the Complaint in

this action as Exhibit L, that he had confused some of what was said in my telephone

conversations with what was written in the e-mail correspondence. See Compl. Ex. L at

2:27-3:1. Mobrez stated that, I do specifically recall a telephone conversation with

someone who mentioned five grand as the cost for joining the Corporate Advocacy

Program . . . I do not know whether the speaker was Magedson or not. See Compl. Ex. L

at 3:18-24.

Mobrez also stated that part of his testimony was based on erroneous assumptions

drawn from Mr. Magedsons prior declarations. See id. at 4:5-6. In the California Action

Magedson had filed declarations on March 22, 2010 and April 5, 2010, falsely claiming

that Mobrez had threatened him in a telephone call. On May 11, 2010, Gingras filed a

declaration for Magedson stating, in part:

Having reviewed the recordings, I believe that I was mistaken when Itestified in my affidavits that Mr. Mobrez made such threats towards me. I must

have confused Mr. Mobrez with someone else.

Upon reviewing the six recordings of the calls/voicemails from Mr. Mobrezwhich took place approximately a year ago, I realize now that I may not haveaccurately recalled the substance of those calls. These recordings do not contain anythreats by Mr. Mobrez to locate me in Arizona and to the extent that my previousaffidavits stated that such a threat occurred during those calls, I must have been



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mistaken.

I believed that Mr. Mobrez was one of the people who threatened mebecause 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 MrMobrez in response to a statement from him which threatened to find me in Arizona

or to have someone else do so[.]2.

Thus, Xcentrics counsel is aware that both Defendant Mobrez and Magedson were both

confused by Magedsons prior false statements. The confusion claimed by Mobrez falls

far short of a finding of willfulness necessary for perjury, and does not support the serious

allegations of perjury leveled by Xcentric in the Complaint.

2. The Alleged Perjury Was Not Material to The Cause of Action

Moreover, the substance of the alleged perjury was itself not material to the cause

of action for RICO predicated on attempted extortion in the California Action. Exhibit A

attached to Xcentrics Complaint show that the original complaint in the California Action

alleged, in the claim for RICO predicated on attempted extortion, inter alia:

62. On or about May 5, 2009, Mobrez, on behalf of AEI, sent an email toRipoffreport.com advising that it was posting false and defamatory informationabout the company. Magedson responded via email describing the websites policiesand referring the Plaintiffs to the Ripoff Reports Corporate Advocacy, Businessremediation and Customer Satisfaction Program. The program promised, amongother things, to change[] the negative listings on search engines into a positivealong with all the Reports on Rip-off Report. The pair later spoke by telephoneduring which Magedson offered to enroll the Plaintiffs in the abovementionedprogram for an initial fee of $5,000 plus additional monthly monitoring fee. Oneweek later, after Plaintiffs failed to fill out the appropriate paperwork, Magedsonsent Mobrez an e-mail requesting he fill out the forms necessary to join the program.

63. Plaintiff rejected Defendants attempt to wrongfully collect and extort moniesfrom their funds. Nevertheless, Defendants program amounts to attempted

2See AEI v. Xcentric, C.D. Cal No. 10-cv-1360 DN-31 (May 11, 2010), available at

https://ecf.cacd.uscourts.gov/doc1/031110147370.



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extortion[.]

64. . . . The electronic and telephonic communication between Mobrez andMagedson constitute several predicate acts sufficient to establish a pattern of

racketeering activity as that term is defined in 18. U.S.C. 1961(1) and (5).

65. . . . Defendants and individuals associate with them have perpetrated thisscheme upon other entities. According to court records, other individuals have hadsimilar offers made to them from Ed Magedson and Ripoff Report.com to addressnegative, false, misleading and defamatory posts.

See Compl. Ex. A at 20-21 (emphasis added).

It was undisputed in the California Action that Magedson sent Mobrez emails

describing the Corporate Advocacy Program (CAP) as one that changes the negativelistings on search engines into a positive along with all the Reports on the Ripoff Report.

See Asia Econ. Inst. v. Xcentric Ventures, LLC, 2010 U.S. Dist. LEXIS 13337 at *20

(C.D. Cal. July 19, 2010). It was also undisputed that Xcentric charges $7,500 plus a

monthly maintenance fee for CAP. See id. at *13. Moreover, the court in the California

Case found that members of CAP receive preferential treatment, including that negative

reports about CAP members are less prominent in internet searches.3

Here, Xcentric is alleging that Mobrez committed perjury by stating that he was

asked on the telephone to join CAP for $5,000, as opposed to receiving an email

describing the CAP, and, in fact the initial fee for CAP costs $7,500 rather than $5,000.

These differences are not material to the AEI Parties claim for RICO predicated on

a pattern of attempted extortion. As noted by the Court in the California Action, the AEI

Parties only relied on threats made in writing and did not rely upon the California

3See AEI v. Xcentric, C.D. Cal No. 10-cv-1360 DN-184, available at

https://ecf.cacd.uscourts.gov/doc1/031112261815 (May 4, 2011 Order) at 4.



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attempted extortion statute that applies to threats not made in writing.4

Accordingly, the

statements could not support a finding of perjury.

In the California Action, Xcentric kept trying to revive the issue of the recordings

that had been barred from evidence. Xcentrics counsel filed an unsuccessful Rule 11

motion grounded in part on the alleged perjury of the defendants which claimed, falsely

that:

[I]t was proven that the individual Plaintiffs (Mr. Mobrez and Ms. Llaneras)committed perjury in this case by manufacturing and presenting sworn falsetestimony accusing Mr. Magedson of demanding $5,000 in order to make negativeinformation disappear from the Rip-Off Report website.

5

This Rule 11 motion was denied.6 Of course, no perjury was ever proven.

Accordingly, these renewed allegations of perjury are scandalous and prejudicial.

Accusing the Defendants in a new forum of perjury in order to again attempt to recover

attorneys fees for immaterial statements, which were in fact corrected, is vexatious and

unnecessarily multiplies the proceedings.

IV. CONCLUSION

For the foregoing reasons, paragraphs 2, 42, 44, 50 and 51 of the Verified

Complaint should be stricken as impertinent, scandalous, and prejudicial.

4See Asia Econ. Inst. v. Xcentric Ventures, LLC, 2010 U.S. Dist. LEXIS 13337 at *46

(although not relied upon by Plaintiffs here, California Penal Code 524 criminalizes

attempted extortion by means of a threat even where such threats are not made in writing.Cal. Penal Code 524.) (emphasis added).

5AEI v. Xcentric, AEI v. Xcentric, C.D. Cal No. 10-cv-1360 DN-135 (Sept. 3, 2010) at2:12-15, available at https://ecf.cacd.uscourts.gov/doc1/031110823447 (emphasis added).

6See AEI v. Xcentric, C.D. Cal No. 10-cv-1360 DN-184, available at:

https://ecf.cacd.uscourts.gov/doc1/031112261815 at 14.



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RESPECTFULLY SUBMITTED this 31st day of October, 2011.

QUARLES & BRADY LLPRenaissance One, Two North Central AvenuePhoenix, AZ 85004-2391

By /s/ David E. Funkhouser IIIJohn S. CraigerDavid E. Funkhouser III

Attorneys for Lisa Jean Borodkin



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CERTIFICATE OF SERVICE

I hereby certify that on October 31, 2011, I electronically transmitted the attached

document to the Clerk's Office using the CM/ECF System for filing and transmittal of a

Notice of Electronic Filing to the following CM/ECF registrant:

David S. Gingras, Esq. ([email protected])Attorneys for Plaintiff

Hartwell Virginia Harris ([email protected])Attorney for Defendants Mobrez, Llaneras and AsiaEconomic Institute LLC

/s/ David E. Funkhouser III


36 - motion to strike

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