Real Estate Topics Forum :: View topic - John T. Reed’s Anti-S.L.A.P.P. motion in Whitney vs. Reed 2

Guest

John T. Reed’s Anti-S.L.A.P.P. motion in Whitney vs. Reed 2

39. One of the statements that was on Reed’s Web page that Whitey alleges is libelous is David Keith’s comment, “The only thing that gives me some relief is that I know he will be arrested and do hardtime in the future…all this will catch up to him…he is a true crook at heart and a vile little man.” This statement is little different from a statement that Whitney makes in his own book Building Wealth quoting his mother: “[My mother] told me repeatedly that I was no good, that I would never amount to anything, and that I would probably wind up spending most of my life in jail.” Whitney published Building Wealth in 1994, distributes it internationally through book stores and directly, and continues to this day to promote its sale vigorously. (Defendant’s Affidavit ¶17)
40. Russ Whitney is libelproof, that is, he cannot prevail in a libel suit because his reputation is so poor that little or no incremental harm could possibly be done to it by anyone. (Defendant’s Affidavit ¶¶14 to 23)
41. The motion to dismiss shows that the challenged statements are opinion or hyperbole and therefore cannot be shown to be false. Reed’s affidavit shows that so much negative information has been published about Russ Whitney that is consistent with or worse than the challenged satements that Whitney will not be able to prove “actual malice.” In which case, he has no probability of prevailing in the libel suit.
Choice of state law
42. California, not Florida, law should apply to the non-federal questions in this suit. This is a “multistate defamation” suit. “Multistate defamation” has its own separate section in Restatement (Second) of Conflict of Laws: §150.
43. In the Gertz decision, the U.S. Supreme Court admonished against liability without “fault” and indicated that “fault” refers to a single standard imposed by the jurisdiction of the defendant’s place of business. In Sack on Defamation, Libel, Slander and Related Problems, 3rd edition, Robert D. Sack said, “…the rules for defamation cases now call for the application of the law of the place with ‘the most significant relationship’ to the case.”
44. In 1980, the Florida Supreme Court adopted the “most significant relationship test from Restatement (Second) of Conflict of Laws, §§145-56. This requires that the statute of limitations of the state with the most significant relationship to the alleged libel be applied. Bishop v. Florida Specialty Paint Co., 389 So 2d 999 (Fla 1980) See also Bates v. Cook, 509 So 2d 1112 (Fla 1987)
45. In Starace v. Chicago Tribune Co., [17 Media L. Rep. 2330 (S.D. N.Y. 1990)], the district court applied the law of the forum where the plaintiffs claimed the most injury. Similarly, Restatement (Second) of Conflict of Laws §150 Comment (e) says, “When there has been publication in two or more states of an aggregate communication claimed to be defamatory, at least most issues involving the tort should be determined, subject to the possible limitation stated in Comment (d) [relating to different kinds of special damages in different states], by the local law of the state where plaintiffs have suffered the greatest injury by reason of loss to his reputation.” Ibid. §150 Comment (e) page 459
46. “A state which is not the state of the plaintiffs’ domicil, may be that of most significant relationship if it is the state where the defamatory communication caused plaintiffs the greatest injury to their reputation. This may be so, for example, in situations where (a) the plaintiff is better known in this state than in the state of his domicil, or (b) the matter claimed to be defamatory related to an activity of the plaintiffs that is principally located in this state, or (c) the plaintiffs suffered greater special damages in this state, or (d) the place of principal circulation of the matter claimed to be defamatory was in this state.
47. “Other contacts that the forum will consider in determining which is the state of most significant relationship with respect to the particular issue include (a) the state or states where the defendant did his act or acts of communication, such as assembling, printing and distributing a magazine or book and (b) the state or states of the defendant’s domicil, incorporation, or organization and principal place of business.” Ibid.
48. Although Whitney is headquartered in Florida, he likely has about 35% of his real estate investment customers in California and only about 6% in Florida because of disproportionate interest in real estate investment in California (Reed affidavit in support of California Anti-SLAPP motion ¶¶11, 12). The court can take judicial notice of the fact that the U.S. Bureau of the Census says on April 1, 2001 the population of California was 34,501,130 and the population of Florida was 16,396,515. (http://quickfacts.census. gov/qfd/)
49. New York is the capital of both print and broadcast publishing in the United States. “…as the center of publishing in this country New York has a strong, widely recognized interest in regulating media defendants whose speech originates in New York. [McClain v. Camoflage Associates, 22 Media L. Rep. 2440]
50. When a Florida plaintiff sued the New York-based Wall Street Journal regarding allegedly false statements published in the Journal regarding New York activities, the federal court held that New York, not Florida, had the most significant contacts with the claim. [Rudin v. Dow-Jones & Co., 510 F. Supp. 210 (S.D.N.Y. 1981)] That decision went on to say, “[s]trong policy reasons exist for deciding issues whose major impact is on the behavior of potential defendants according to the rules of the jurisdiction where the conduct that gives rise to liability takes place…especially when that conduct may be protected speech.” Ibid. 580 F. Supp. 1093
51. “Applying New York law gave both protection and predictability, enabling those engaged in publishing from New York to tailor their conduct to meet those legal norms.” [Lee v. Bankers Trust Co., 166 F 3d 540 (2nd Cir. 1999)
52. Similarly, the Third Circuit said there are, “…strong policy reasons in protected speech areas for deciding issues that have an impact on defendant’s behavior according to the rules of the jurisdiction in which the conduct at issue took place.” [Buckley v. McGraw-Hill, Inc., 782 F. Supp. 1042 (W.D.Pa. 1991) 968 F. 2d 12 (3d Cir. 1992)]
53. However strong these policy considerations are for huge companies like Dow-Jones and McGraw-Hill, they are far greater for publishers like defendant Reed’s one-man, home-office-based, self-publishing, sole proprietorship. If the federal courts permit libel plaintiffs to haul tiny Web publishers across the country to defend suits in hundreds of different jurisdictions, such publishers will be forced to stop all publishing that might be the subject of a libel suit, regardless of the merits of the material.
54. In Aro Chem International. Inc. v. Buirkle [918 F 2d 266 (2nd Cir. 1992)], the court held that the libel privilege was conduct regulating and that the California statute therefore applied despite the fact that plaintiff was a Connecticut domiciliary and the law of Connecticut would therefore have been expected to apply. “Thus where there is a multistate libel, it must be determined from among the potentially conflicting standards of care of several states, which is the applicable standard for gauging the defendant’s ‘fault.’ The law of the plaintiff’s domicile has little or no relation to it; the law of the defendant’s domicile does.” Sack on Defamation, Libel, Slander and Related Problems, 3rd edition, §15.3.2
55. “In determining a question of choice of law, the forum should give consideration not only to its own relevant policies, but also to the relevant policies of all other interested states. The forum should also appraise the relative interests of the states involved in the determination of the particular issue. In general, it is *beep* that the state whose interests are most deeply affected should have its local law applied. Which is the state of dominant interest may depend upon the issue involved.” Restatement (Second) of Conflict of Laws §6 page 14
56. “The content of the relevant local law of a state may be significant in determining whether this state is the state with the dominant interest.” Ibid. page 15 “The rights and liabilities that arise from defamatory matter…are determined by the local law of the state, which, with respect to the particular issue, has the most significant relationship to the occurrence and the parties under the principles stated in §6. Ibid §150 (1) page 455
57. Defendant Reed resides in the Northern District of California and operates his publishing business and Web site out of his home office there. California’s “Silicon Valley” is to the Internet what New York City is to print and broadcast publishing. The Northern District of California is “Silicon Valley’s” federal court.
For the reasons stated above, this court should strike the complaint and award attorney fees and costs to defendant pursuant to California Code of Civil Procedure §425.16.
August 22, 2002 ________________________________
Date John T. Reed, pro se Defendant
John T. Reed Publishing
342 Bryan Drive, Alamo, CA 94507
925-820-6292, Fax: 925-820-1259
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA

WHITNEY INFORMATION NETWORK, INC.,
a Florida Corporation, and RUSS WHITNEY,
an individual,

Plaintiffs, AFFIDAVIT IN SUPPORT OF
MOTION TO STRIKE PURSUANT
v. TO THE CALIFORNIA ANTI-
SLAPP STATUTE, CCCP §425.16
JOHN T. REED, an individual, CASE NO.: 2:02-CV-288-FTM-29DNF

Defendant.

I, defendant John T. Reed declare and state as follows:
1. I am a 56-year-old self publisher. That is, I write and publish my own books. Book authors normally produce only a manuscript. Publishers then turn manuscripts into final book form, have them printed, and market them at their expense. As a self-publisher, I perform all of these functions. I have been in the publishing business since 1976 and have sold over 150,000 books and 3 million newsletters to a nationwide audience. I only sell books, audio cassettes, and newsletter subscriptions. I offer no services comparable to Whitney’s seminars or “boot camps” or “consulting” services. In 1981, I self-published my first book on real estate investment and now have 17 books and nine audio cassette programs on that subject. I also self-publish books on youth baseball coaching and football coaching.
2. I am not an attorney. I graduated from the United States Military Academy at West Point, NY in 1968. At West Point, I took a course in Constitutional law and a course in the Uniform Code of Military Justice. In 1977, I received a masters degree in business administration from Harvard. During my second year there, I completed a course in federal income tax law. I have had no other legal training and never enrolled in a law school. I consult with New York media attorney Marshall Beil from time to time, but he is not representing me in this lawsuit.
3. I am the entire full-time staff of John T. Reed Publishing. My 15-year-old son Michael helps me process orders and bind books.
4. Whitney and I both sell information on real estate investment. Each of us has a Web site that criticizes the other, as well as criticizing other real estate investment gurus.
5. In three certified, return-receipt letters from his attorneys (Exhibits A, B, and C of my Motion to Dismiss), between December 1, 2000 and June 25, 2001, Whitney ordered me to remove all mention of Whitney from my Web site. I did not comply.
6. A fourth letter, Exhibit D to the motion to dismiss, complained that several statements in an email from David Keith (plaintiffs’ Exhibit C to the complaint) were libelous. I removed two of those comments the day I received the letter from Whitney’s attorney and told him so by certified return receipt letter dated January 17, 2002 (Exhibit E to my Motion to Dismiss).
7. Exhibit “C” to Whitney’s complaint, contains a threat made by Whitney to the owners of Creative Real Estate Online (CREO) Web site. That site, like mine, published emails from unhappy Whitney customers. The threat has been in my Web site discussion of Whitney since November, 2001 and remains at the CREO Web site as well. Whitney has never complained that it is inaccurate.
8. Four of my 368 Web pages mention Whitney. They are attached to the motion to dismiss as Exhibits F, G, H, and I. Here are their URLs (Web addresses), page titles, and headlines, respectively:
• URL: www.johntreed.com/Whitneycomments.html, Page title: “Reader comments sent to John T. Reed about Russ Whitney,” Page headline: “Reader comments sent to John T. Reed about Russ Whitney”
• URL: www.johntreed.com/Reedgururating.html, Page title: “John T. Reed’s views of various real estate investment gurus,” Page headline: “John T. Reed’s views of various real estate investment gurus,”
• URL: www.johntreed.com/BSchecklist.html, Page title: “The real estate B.S. artist detection checklist article by John T. Reed,” Page headline: “The real estate B.S. artist detection checklist”
• URL: www.johntreed.com/Foreclosureworld.html, Page title: “Email from kevin Dean about Russ Whitney and Foreclosureworld,” Page headline: “Email from Kevin Dean about Russ Whitney and Foreclosureworld”
9. I am not aware of a single instance where a reader of my Web site mistook it for Whitney’s. The Whitney mentions have been on my Web site for years.
10. The forum where plaintiffs will claim the most injury is California. Upon information and belief based on claims at Whitney’s Web site www.russwhitney.com, Whitney sells his products and services nationwide and in Canada and the United Kingdom.
11. I became a real estate investment writer for the Harcourt Brace-published newsletter Real Estate Investing Letter as a summer job between my two years at Harvard Business School in 1976. The Real Estate Investing Letter was based in Boston at that time. Later, it moved to New York City, then Connecticut. In spite of being based in the Northeast, the Real Estate Investing Letter always had the highest number of subscribers in California and the percentage of subscribers from California always greatly exceeded the percentage of the U.S. population that was from California.
12. It is generally not possible to tell which state an Internet user is from his email address. But my postal service mailing list probably has a similar geographic distribution to my real estate Internet visitors. The last time it was printed out—February of 1999—35% of my customers were from California; only 6% from Florida. Since this pattern of disproportionate interest in real estate investment has been consistent throughout my career in Boston, New York , Connecticut, and California, Whitney’s postal service mailing list of real estate investment customers would almost certainly show a similar breakdown, notwithstanding the fact that his headquarters is in Florida.
13. Whitney has had a terrible reputation ever since he became known in the real estate investment information industry.
14. To a large extent, plaintiffs’ bad reputation stems from his own self-descriptions. In his book Building Wealth, he describes himself as, “a high school dropout with a bad attitude” (page 17)
15. In Building Wealth, Whitney apparently confesses to a number of crimes, civil law, and ethics violations (Exhibit A of this Affidavit):
• lying on a job application (page 23)
• using a counterfeit drivers license to obtain a job driving passengers for hire (page 23)
• converting single-family homes to rooming houses without obtaining necessary permits or installing safety retrofits required in densely occupied buildings (page 44)
• lying to a bank loan officer about the true purpose of a loan he was seeking (page 56)
• simultaneously applying for multiple bank credit lines without disclosing the other applications to each bank (page 57)
• charging his property management clients double actual cost for repairs and pocketing the markup in addition to his percentage-of-the-gross-income management fee (page 66) Property managers are licensed real estate brokers and have a fiduciary duty to obtain the best prices on repairs for their clients (Certified Property Manager Code of Ethics Exhibit B of this affidavit) . I am a former property manager and a former member of the Institute of Real Estate Management.
• telling banks that planned improvements were estimated to cost $17,000 and obtaining improvement loans for that amount, when, in fact, he knew the actual cost was only $3,000 (page 70)
• collecting “consulting” fees for finding real property for a buyer while unlicensed (page 73)
• “[My mother] told me repeatedly that I was no good, that I would never amount to anything, and that I would probably wind up spending most of my life in jail.” (page 22)
16. Whitney published Building Wealth in 1994, distributes it internationally through book stores and directly, and continues to this day to promote its sale vigorously.
17. I have received hundreds of emails about Whitney and seen many Internet postings about Whitney. I have also interviewed some Whitney customers by phone. The general picture they paint is that Whitney and his employees promise unrealistically easy riches in pep rally style free seminars that use tactics that go beyond extreme high pressure to get prospects to sign up for expensive “boot camps” and “consulting” services. In addition, those who attend the expensive “boot camps” or sign up for various telephone consulting services report that much of the time in the “boot camps” or “consulting” is devoted to more extreme high pressure selling to purchase additional “boot camps” or “consulting” services. One of Whiney’s schemes somehow promises profits for going door-to-door persuading homeowners to pay their mortgage biweekly instead of monthly. Complaints at various Web sites and elsewhere say these businesses are not viable and that the thousands spent on training and related software and equipment were wasted.
18. Upon information and belief based on numerous Internet discussions, Whitney is associated with a company called Leasecomm Corp. that purportedly finances the lease of software and credit card processing machines for various start-up business endeavors. The attorneys general of Massachusetts and Florida have demanded and received documents from Leasecomm and its parent company MicroFinancial, Inc. according to a quarterly filing by that firm with the Securities and Exchange Commission on 8/14/02. (Reuters News report Exhibit C to the affidavit) That filing says Massachusetts is investigating potentially unfair or deceptive acts regarding the sale, solicitation and marketing of leasing agreements as well as the billing and collection procedures. Florida is investigating whether the leases, which Leasecomm says are commercial ones, are, in fact, consumer transactions. A Massachusetts attorney told me by phone that another lawyer there tried and failed to get a class action certified against Leasecomm. The attorney to whom I spoke is also trying to get a class action suit certified against Leasecomm.
19. In addition to their personal experiences with Whitney and his various associated businesses, Internet posters also cite various third-party complaints including Better Business Bureau complaints and FTC and state cease-and-desist orders against Global Resource Network. Upon information and belief, Whitney is or was associated with Global Resources Network.
20. The Google search results shown in plaintiffs’ Exhibit “B” to the complaint were achieved in an unusual and unrepresentative manner. Plaintiffs typed the words Russ and Whitney into the search criteria box, put a space between them, and put them in quotation marks. This tells the search engine to search only for the names Russ and Whitney, in that order, with a space between them. Such a search criterion would miss many pages that were either owned by plaintiffs or about them. For example, this search criterion would miss the plaintiffs’ domain name—www.russwhitney.com—because there is no space between russ and whitney. This search criterion would also miss most of the mention’s of Whitney at my Web site because they generally only refer to the last name.
21. For both likelihood of confusion and libel purposes, the court is supposed to view my Web pages and the Google search results as the average member of the pertinent class would. It is common knowledge that the average Google searcher does not use the advanced technique of putting a name inside quotation marks. Rather he or she would typically simply type in the words russ and whitney, thereby getting all pages that included both names or either one.
22. A Google search for Russ Whitney, without quotation marks, that I did after receiving the complaint resulted in 29,400 hits. In that search, the Kevin Dean email had dropped to tenth—the last item on the first page. No other Web page from Reed’s Web site were in the first 99 pages and Google does not permit users to see results beyond the first 99 pages. There are ten results per page in a Google search, so no other page of my Web site ranked in the first 990 listings, which are the only results that can be seen.

___________________________
John T. Reed, Pro Se Defendant
342 Bryan Drive, Alamo, CA 94507
Telephone: 925-820-6292
Fax: 925-820-1250
email: johnreed@johntreed.com

Sworn to before me this ______________ day of _________________, 2002

____________________________
Notary Public
John T. Reed, a.k.a. John Reed, Jack Reed, 342 Bryan Drive, Alamo, CA 94507, Voice: 925-820-7262, Fax: 925-820-1259, Email: johnreed@johntreed.com

CONSUMER WARNING NOTICE: I recently saw Russ Whitney on a late night TV infomercial and then attended one of his "free" seminars. Unfortunately I believed all of their LIES and FRAUDULENT CLAIMS and I paid thousands of dollars to go to his "training camps". Needless to say I was clearly ripped off, cheated and lied to by Russ Whitney and his employees (band of thieves). My mistake was not searching the Internet to find out more about Russ Whitney and his company's HORRIBLE reputation for fraud, deception and illegal activities. Had I searched online I would have found out about THOUSANDS of customers being cheated, HUNDREDS of investigations by the Attorney General into the fraud of Russ Whitney and his company's, and that Russ Whitney himself is a CONVICTED VIOLENT FELON and spent years in PRISON. I saved the cached pages from the major search engines of the John Reed lawsuit with Russell Whitney and the TRUTH and FACTS that Reed discovered during his investigation of Whitney. I am posting this information on real estate discussion boards so other people do NOT get cheated and ripped off like I did.