Posts by Bonk

2011 – LC – Eddie Cressy vs. OM Financial Life Insurance Company – Doug Andrew – 11-05871

• 2011 – LC – Eddie L. Cressy vs. OM Financial Life Insurance Company – Doug Andrew – 11-05871  —  [BonkNote]
  • • 2:11-cv-05871 
    • District Court, C.D. California
    • Date Filed: July 18, 2011, Date Terminated: June 4, 2013
    • courtlistener.com/docket/4147349/eddie-l-cressy-v-om-financial-life-insurance-company/

• Document 1 – 2011 0718 – Class Action Complaint – 63p
• Document 62 – TRANSCRIPT OF PROCEEDINGS – MARCH 12, 2012 – 11-cv-05871 – 45p
  • 9 – Judge: PARAGRAPH 36, FOR EXAMPLE, OF THE COMPLAINT ABOUT DEFENDANTS MADE UNIFORM MISREPRESENTATIONS, HALF-TRUTHS, MATERIAL OMISSIONS, THAT’S NOT ENOUGH. IT NEEDS TO BE MORE SPECIFIC AS TO WHAT WAS STATED AND WHEN IT WAS STATED AND BY WHOM IT WAS STATED.
  • 11 – MR. AZADIAN: WE DO NOT READ THE COMPLAINT THAT WAY. IN PARTICULAR, THE ONLY ALLEGATIONS THAT HAVE BEEN MADE AGAINST OUR CLIENTS ARE THAT THEY HAVE AUTHORED A BOOK AND HAVE PROMOTED THAT BOOK THROUGH MISSED FORTUNE 101 SEMINARS. THERE’S NO — AS YOUR HONOR DID SUGGEST IN THE TENTATIVE RULING, THERE’S NOTHING TYING MR. ANDREW AND PARAMOUNT FINANCIAL TO THE OTHER DEFENDANTS AND THE PURPORTED FINANCIAL ACTIVITIES OF THESE OTHER DEFENDANTS. WITHOUT THAT NEXUS, YOUR HONOR, THERE CANNOT BE ANYTHING IN THIS COMPLAINT TO SUGGEST THAT OUR CLIENTS DID ANYTHING WRONG OTHER THAN PUBLISH A BOOK, AUTHOR A BOOK AND PROMOTE THAT BOOK. I DON’T THINK THAT’S A MYOPIC VIEW OR A MYOPIC READING OF THE COMPLAINT. 
  • 13 – THE COURT: YOU READ THAT AS SAYING THEIR SOLE ROLE WAS AS PRODUCERS OF THE MATERIALS AND THAT THEY HAD NO OTHER ROLE?
    • MR. AZADIAN: YES, YOUR HONOR. 
  • 18 – Judge:  IF YOU AMEND YOUR COMPLAINT WITHIN THE TWO WEEKS, WHAT ALLEGATIONS CAN YOU MAKE AS TO THE AUTHORS OF THIS BOOK THAT WOULD MAKE THEM OTHER THAN AUTHORS OF A BOOK? 
  • 18 – MR. YANCEY: YOUR HONOR, I WOULD ALLEGE THAT MR. ANDREW, FIRST AND FOREMOST, WHILE AT THE RELEVANT TIMES THE POLICY AT ISSUE WAS SOLD TO MR. CRESSY, WAS A LIFE INSURANCE AGENT APPOINTED BY OM FINANCIAL AS ONE OF THEIR AGENTS FOR THE PURPOSE OF SELLING AND MARKETING THEIR PRODUCTS.
    • I WOULD ALSO ALLEGE WITH MORE SPECIFICITY HOW MR. ANDREW ACTIVELY PURSUES OTHER INSURANCE AGENTS TO ATTEND HIS TRAINING SEMINARS NOT FOR THE PURPOSE OF PROMOTING HIS BOOK, BUT FOR THE PURPOSE OF HOPEFULLY HAVING THEM AFFILIATE WITH HIMSELF SO THAT HE WILL OBTAIN OVERRIDE COMMISSIONS WHEN THEY SELL POLICIES AFTER USING WHAT THEY LEARN IN THE TRAINING SESSIONS HE HOLDS WHERE HE TEACHES THEM SPECIFICALLY HOW TO MARKET AND SELL EQUITY INDEX UNIVERSAL LIFE POLICIES. THAT’S WHAT WE WERE TRYING TO GET OUT WITH THE FIRST COMPLAINT. AND I —
  • 20 – THE COURT: WHAT INFORMATION DO YOU PRESENTLY HAVE THAT YOU SAY SUPPORTS YOUR VIEW THAT MR. ANDREW WOULD RECEIVE COMPENSATION FROM THOSE WHO ATTEND SEMINARS SHOULD THEY SELL THE PRODUCT IN A PARTICULAR WAY AND RECEIVE PREMIUM — EXCUSE ME, COMMISSIONS OF A CERTAIN AMOUNT? 
  • 23 – THE COURT: I UNDERSTAND. I THINK I’VE IDENTIFIED THE ISSUE. IF TONY ROBBINS WERE CONDUCTING A SEMINAR ON MOTIVATIONAL SPEAKING AND WERE URGING PEOPLE TO GO PREY ON ELDERLY IN SOME FASHION OR ANOTHER OR GIVING THEM THE TOOLS TO DO IT AND SAID, WHEN YOU DO IT, I GET A 10 PERCENT TAKE ON THAT, YOU KNOW, THAT WOULD BE DIFFERENT.
  • 36 – MR. TAYLOR: … THE PLAINTIFF STILL HAS TO AFFIRMATIVELY ALLEGE WHAT DILIGENCE HE CARRIED OUT, WHEN HE DISCOVERED IT AND THE LIKE.
  • 41 – THE COURT: HAVE YOU TALKED ABOUT A SETTLEMENT PROCESS?
    • MR. TAYLOR: WE HAVE NOT, YOUR HONOR.
    • THE COURT: DO YOU THINK —
    • MR. YANCEY: WE DID AGREE TO NON-JUDICIAL. 
• Document 66 – 2012 0328 – STIPULATED PROTECTIVE ORDER REGARDING CONFIDENTIAL INFORMATION 11-05871 – 10p
• Document 108 – TRANSCRIPT OF PROCEEDINGS – JUNE 25, 2012 – 11-cv-05871 – 43p
  • 16-17 – NAIC MODEL REG‘S HAS ADOPTED THE REGULATION, CALIFORNIA INCLUDED, THAT SAYS WITH RESPECT TO CONTENT OF ADVERTISING, INSURERS AND THEIR AGENTS ARE STRICTLY FORBIDDEN FROM USING THE TERM “INVESTMENT” OR “RETIREMENT PLAN” OR ANY SUCH TERM TO DESCRIBE A LIFE INSURANCE POLICY. THAT IS WHAT’S AT ISSUE HERE. 
  • 21 – SECONDLY, NOWHERE IN THE POLICY, WHICH I BELIEVE IS DOCKET 27, IS THE WORD “INVESTMENT” USED. 
  • 21 – NOWHERE IN THE FIRST AMENDED COMPLAINT, WHICH IS PLAINTIFF’S FOURTH BITE AT THE APPLE, IS THERE ANY ALLEGATION THAT FG LIFE OVERSAW, HAD RESPONSIBILITY FOR OR WAS ANY WAY INVOLVED IN THIS NOW SO-CALLED PLAN. 
  • 22 – Puffery – IF THERE IS AN INCONSISTENCY BETWEEN THE ORAL STATEMENTS MADE TO A PLAINTIFF AND THE WRITTEN DOCUMENTS, THOSE CONSTITUTE STORM WARNINGS. AND THEY PLACE THE PLAINTIFF ON INQUIRY NOTICE WHICH REQUIRES HIM OR HER TO CONDUCT A REASONABLE INVESTIGATION. 
  • 22 – FINALLY, PLAINTIFF’S COUNSEL SAYS THAT THIS PLAINTIFF DID NOT KNOW THAT HE WAS RECEIVING DEATH BENEFITS. BACK TO PAGE 7, BOLD TYPE LEFT-HAND CORNER, “DEATH BENEFIT.”
  • 24 – TWOMBLY VERSUS IQBAL IN WHICH THE SUPREME COURT TEACHES US THAT IT HAS TO BE PLAUSIBLE
  • 24 – MR. TAYLOR: REASONABLE EFFORTS TO DISCOVER THE ALLEGED FRAUD.
  • 25 – THE COURT: PUT ON NOTICE OF WHAT?
    • MR. TAYLOR: ON NOTICE THAT HE SHOULD WATCH HIS INVESTMENT, THAT HE NEEDS TO STUDY IT. 
  • 37 – MR. YANCEY:  SINCE 2004, MR. ANDREW HAS REPEATEDLY AND CONTINUOUSLY USED THE INTERNET TO MISREPRESENT EQUITY INDEXED UNIVERSAL LIFE INSURANCE POLICY AS INVESTMENTS.” 
  • 38 – MR. YANCEY: WE ALSO ALLEGE, SPECIFICALLY, THAT OM FINANCIAL APPROVED OF ALL THE SALES AND MARKETING MATERIALS OF THE MISSED FORTUNE PLAN AND THE SOFTWARE PROGRAM THAT WAS USED.
  • 40 – MR. YANCEY: WE HAVE ATTEMPTED TO SCHEDULE DEPOSITIONS OF THE DEFENDANTS. AND THEY HAVE RESISTED, SO —
• Document 131 – CIVIL MINUTES – GENERAL – October 15, 2012 – 11-cv-05871 – 4p 
• Document 149 – FINAL JUDGMENT JS-6 – 2p
• Pacer – Yes
• 2007 – USPTO – The Official Gazette – 1051p-GooglePlay
  • “The Equity Asset Management System” (i.e. “T.E.A.M.S.”).;

• 105 – (p9-10) –
  • MR. TAYLOR: I WOULD. WITH RESPECT TO FRAUDULENT CONCEALMENT, WE BELIEVE THAT THE LAW SAYS THAT THERE HAVE TO BE OVERT STATEMENTS THAT WERE MADE BY A DEFENDANT THAT STOPPED THE PLAINTIFF FROM TAKING CERTAIN ACTIONS. WE STILL BELIEVE REGARDLESS OF WHAT THE COURT HAS SAID THE PLAINTIFF HAS TO ALLEGE WHAT HE RELIED UPON IN NOT TAKING FURTHER ACTION WITH RESPECT TO HIS CLAIMS. WE THINK THE LAW IS CLEAR. AND IT STARTS WITH THE CASE IN THE FIRST CIRCUIT IN 1986 CALLED KENNEDY VERSUS JOSEPHTAL (PHONETIC) WAS ADOPTED BY THE NINTH CIRCUIT IN 1986 D.A. DAVIDSON THAT SAYS THAT IF THERE’S A CONTRADICTION BETWEEN THE WRITTEN DOCUMENTS AND THE ALLEGED ORAL REPRESENTATION, THE STATUTE STARTS AT THAT POINT AND THE PLAINTIFF IS ON INQUIRE NOTICE.  WE BELIEVE THAT THOSE DOCUMENTS ARE IN THE RECORD;
    • THE POLICY CONTRADICTS CRESSY’S ALLEGATIONS OF WHAT HE WAS TOLD AT THE POINT OF SALE.
  • [Statute of Limitations]
• (p14) – MR. TAYLOR – THIS LAW FIRM HAS SUED FG LIFE THREE TIMES. ONCE IN ALABAMA AND THE CASE WAS DISMISSED. ONCE IN VIRGINIA, WHICH WAS SETTLED, AND NOW WE’RE BACK HERE. WE WILL HAVE TO GO THROUGH SEVEN AND A HALF MILLION DOLLARS TO COMPLY WITH THESE DOCUMENT REQUESTS.
• (p15) – MR. TAYLOR – LET’S SEE IF PLAINTIFF CRESSY CAN FULFILL HIS OBLIGATION TO FILE A PROPER COMPLAINT AS TO WHY IN HIS MIND HE TOOK NO ACTION. THEY’VE GOT 14,000 DOCUMENTS.
• (p17) – MR. TAYLOR – WE DON’T WANT TO WASTE OUR CLIENTS MONEY, CAUSE ULTIMATELY THAT WILL IMPACT FUTURE POLICY HOLDERS. WE KNOW THAT AS A POLICY MATTER THAT IF AN INSURANCE COMPANY HAS TO SPEND MONEY DEFENDING ITSELF, WHO ULTIMATELY GETS HURT? THEY HAVE TO RAISE RATES. SO MAYBE THE BEST WAY TO APPROACH THIS —
  • THE COURT: THEY CAN’T REDUCE THE CEO’S SALARY, I GUESS.
  • MR. TAYLOR: HE MAKES $5 — NO. THE CEO DOES –
  • THE COURT: THAT’S FINE. I DIGRESSED. CONTINUE ON.
• (p19) – 
• (p33) – MR. AZADIAN – MY CLIENTS ARE SMALL ENTERPRISE COLLECTIVELY. IT IS HIM, THE AUTHOR, AND HIS SMALL CORPORATION. A CORPORATION UNDER UTAH LAW.
  • IT IS STILL A HEAD SCRATCHER WHY WE’RE IN THIS CASE.
• (p38) – MR. AZADIAN – AND IT WOULD BE RESULTING IN A GREAT DEAL OF  COSTS CERTAINLY MY CLIENTS DON’T HAVE THE KIND OF  MONEY TO LITIGATE THIS. THEY JUST DON’T. THEY — A GOOGLE SEARCH. A SIMPLE GOOGLE SEARCH WOULD REVEAL THAT. YOU KNOW, THEY SELL BOOKS. THEY GO TO BOOK FAIRS. YOU KNOW THEY GO TO CONFERENCES. WHAT THAT AUTHOR ENDED UP SAYING YOU KNOW AND WHAT IS ATTRIBUTED TO THIS AUTHOR IS PROTECTIVE SPEECH AND WE RESPECTFULLY DISAGREE WITH JUDGE KRONSTADT ON THAT POINT AND WE WILL TAKE OUR APPEAL TO THE NINTH CIRCUIT.
• (p41) – 
• (P42) – 
• (P44) – MY CLIENTS SIMPLY DON’T HAVE THE MONEY THEY NEED THE PROTECTIONS OF THE ANTI-SLAPP STATUTE.
• EQUITY HARVESTING MISSED FORTUNE
• (p54) – 
• (p56) – 
• —————————-

• 78-2 – Declaration of James S. Azadian – attorney with Enterprise Counsel Group ALC, in Irvine, California. My firm is counsel to Paramount Financial Services, Inc. and Douglas Andrew…
  • (p2) – On behalf of defendants Paramount Financial Services, Inc. and Mr. Andrew, I appeared at the Court’s March 12, 2012 hearing on the then-pending dispositive motions directed at Plaintiff’s original complaint. At that hearing, the Court granted the various motions to dismiss the original complaint pursuant to Federal Rules of Civil Procedure 9(b) and 12(b)(6), and the Court deferred ruling on the anti-SLAPP special motion to strike the original complaint. Subsequently, I ordered a transcript of the hearing from the court reporter. A true and correct copy of the March 12, 2012 hearing transcript is attached hereto as Exhibit A.
  • Anti-Slapp
  • (23) – Pyramid Scheme
  • (p26) – THE COURT: I UNDERSTAND. I THINK I’VE IDENTIFIED THE ISSUE. IF TONY ROBBINS WERE CONDUCTING A SEMINAR ON MOTIVATIONAL SPEAKING AND WERE URGING PEOPLE TO GO PREY ON ELDERLY IN SOME FASHION OR ANOTHER OR GIVING THEM THE TOOLS TO DO IT AND SAID, WHEN YOU DO IT, I GET A 10 PERCENT TAKE ON THAT, YOU KNOW, THAT WOULD BE DIFFERENT.

• 78-1 – (p8-9 of 11) –  The fact remains that Mr. Andrew’s authorship of books and seminar talks across the country cannot serve as a basis for liability.¹ The FAC’s allegations do not change this fact, as they are purely conclusory and calculated to disquiet the earlier allegations to avoid the reach of the anti-SLAPP statute, Cal. Civ. Proc. Code § 425.16(b)(1) (West 2012).²  Mr. Andrew and Paramount have made the necessary threshold showing under the anti-SLAPP statute because Mr. Andrew’s book and speaking seminars are classic free speech activities protected by the First Amendment and Article I of the California Constitution.
  • California’s anti-SLAPP statute is designed to protect book authors and other individual public participants, such as Mr. Andrew, from having to spend hundreds of thousands of dollars to defend themselves against conclusory and speculative accusations, only to later confirm, after much legal expense and discovery, that the accusations against them are built on nothing more than speculation that they must have been directly or “integrally” involved in an alleged fraudulent scheme because other defendants or third parties read their books, attended their speaking seminars, and followed their writings.
• If such a case as this advances past an anti-SLAPP challenge, the very purpose for the anti-SLAPP statute would be undermined. It is worth repeating the State Legislature’s finding, as recently underscored by the Ninth Circuit, that “it is in the public interest to encourage continued participation in matters of public significance, and that this participation should not be chilled through abuse of the judicial process.” Manufactured Home Communities, Inc. v. County of San Diego (“Manufactured Home”), 655 F.3d 1171, ___, 2011 WL 3771277 *4 (9th Cir. Aug. 26, 2011).
  • ¹ Incidentally, Plaintiff has not attempted to provide any evidence in support of his conclusory allegations that Defendants were integrally (or even otherwise) involved in a life insurance scheme. In fact, Plaintiff’s pending improper request for judicial notice provides website snapshots demonstrating that Defendants’ business is confined to the authorship, publication, and promotion of books and other literature. (Dkt. No. 59.)
• 78-1 – (p10) – Plaintiff now adds the general allegation that “Mr. Andrew has repeatedly and continuously used the internet to misrepresent equity indexed universal life insurance policies as investments.” (FAC ¶ 81.)