791%?! IN) v-tv?Au-- 19 IN) .4 3 GREENBERG TRAURJG, LLP GREGORY D. TRIMARCI-D3 (SEN 143686) AMY ALDERFER (SEN 205482) - 2450 Colorado Avenu?. Suii? 4005 Santa Monica, California 90404 Telephone: (310) 586-7700 Facsimile: (310) 536-7300 Attorneys for Defendant Brock Pierce SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF LOS AN GELES ALEXANDER MARK CASE NO. LC053103. and MICHAEL E., a minor, by and through his Guardian ad Litem, BONNIE DEFENDANT BROCK SUPPLEMENTAL DECLARATION IN Plaintiffs, SUPPORT OF MOTION TO SET ASIDE DEFAULT JUDGMENT PURSUANT TO vs. C.C.P. SECTION 473.5 MARC CHAD EROCK DIGITAL Date: July 17, 2003 ENTERTAINMENT NETWORK, Time: 8:30 am DOES 1 throu 100, inclusive; ABC Dcpt: -1-1- CORPORATI NS 1 through 100. inclusive, Action Filed: July 20, 2000 Defendants. 1 Trial Date: None Set 23 24 25 26 27 28 DECLARATION IN SUPPORT OF MOTION TO ASIDE DEFAULT IUDGMENT 99? pg :91 gage/91/4,3 24 26 27 Defendant Brock Pierce (hereinafter ?Defendant? or ?Pierce?) hereby ?les and serves this Supplemental Declaration in ?mher support of his Motion to Set Aside Default Judgment of Plaintiffs Alexander Burton, Mark Ryan and Michael Egan, by and through his guardian ad litem Bonnie Mound (hereinafter collectively ?Plaintifl?s?), as follows: SUPPLEMENTQ DECLAE OF BROCK PIERCE 1, Brock Pierce, declare and state as follows: 1. I have personal knowledge of the matters stated herein, and could and would competently testify to the same if called as a witness in this action. 2. I am a former officer and director of Digital Entertainment Network a company that provided entertainment programming ?situation comedies" and other programming similar to television shows) over the internet. Marc Collins-Rector (?Collins-Rector?) and Chad Shackley (?Shackley?) are also former officers andlor directors of DEN. 3. In or about July 1999, Plaintiff Alexander Burton (?Burton?), who was a childhood friend of mine from Minnesota, came to visit me in the Los Angcles area. At that time, Iwas living at the home of Collins-Rector and Shackley as their guest. Burton quickly initiated a romantic relationship with Shackley which, to the best of my knowledge and information, continued as a consensual romantic relationship at least until early Spring 2000. As a result of Burton?s relationship with Shackley, Burton became an employee of Burton lived as a guest at the home of Collins- Rector and Shackley; and Burton accompanied Collins-Rector, Shackley and myself on virtually all of our domestic and international travels between July 1999 and early Spring 2000. 4. In late 1999, DEN began to experience business difficulties. Most signi?cant, DEN and Collins-Rector (then, the Chairman of the Board of Directors of DEN) were named as defendants in a civil lawsuit in New Jersey (the ?New Jersey Lawsuit?) which had been filed in or about May 1999. By late 1999, the New Jersey Lawsuit appeared likely to cause signi?cant detriment to DEN. I was not a defendant in the New Jersey Lawsuit nor involved in that litigation in any way. 5. The New Jersey Lawsuit resulted in a con?dential settlement agreement. lnexplicably, the details of the con?dential settlement agreement in the New Jersey Lawsuit, and various other pieces of con? dential information concerning DEN and Collins?Rector were ?leaked? 1 TN SUPPORT Di? MOTION TO SET ASTDE DEFAULT JUDGMENT 6 139 7'31 t7'ZlEl? SSA. UN to the press and public in late 1999. Burton was one of the very few individuals who possessed that ?leaked" information. 6. On or about October 25, 1999, Collins?Re::tor, Shackley and I resigned as of?cers and/or directors of DEN. Shortly thereafter, Collins?Rector, Shackley and left the country to avoid the adverse publicity generated by the New crsey Lawsuit and business problems and to pursue new business opportunities in the internet sector in Europe. Burton accompanied us on those travels, as a guest of Shackley. I am no longer in possession of the passport I used for those travels, because that passport expired and I surrendered it when 1 received my new passport. 7. On or about November 1, 1999 through November 13, 1999, I was on the island of St. Martin with Collins-Rector, Shackley and Burton. At no time during this period did Burton state or otherwise indicate that he believed that he had been sexually abused by Collins-Rector, Shackley, or me, nor that he had any intention of ?ling any lawsuit whatsoever against me, Collins-Rector or Shackley. At no time did Burton state that he was being mistreated in any way and, to the best of my knowledge and information, Burton?s consensual romantic relationship with Shackley continued during this period of time. 8. On or about November 16, 1999, Burton, Collins-Rector, Shackley and I visited Barbados to obtain a new passport for Burton. At no time during this visit to Barbados did Burton state or otherwise indicate that he believed that he had been sexually abused by Collins-Rector, Shackley, or me, nor that he had any intention of ?ling any lawsuit whatsoever against me, Collins- Rector or Shackley. At no time did Burton state that he was being mistreated in any way and, to the best of my knowledge and information, Burton?s consensual romantic relationship with Shacldey continued during this period of time. 9. On or about November 17, 1999, I traveled to France with Burton, Collins-Rector and Shackley. We remained in France until December 26, 1999. At no time during this period did Burton state or otherwise indicate that he believed that he had been sexually abused by Collins- Rector, Shackley, or me. Burton did, however, at that time while we were in France, indicate to me for the first time that he was considering a plan to extort money from Collins-Rector and/or DEN. He solicited my interest in participating in his planned extortion. I advised Burton that Ihad no interest 2 SUPPLEMENTAL DECLARATION TN SUPPORT OF MOTION TO SET ASIDE DEFAULT JUDGMENT Ell El??tii t7S QZBG participating in such an extortion scheme, and I strongly discouraged him ?om pursuing it. Therea?er, he never again mentioned the extortion plan to me. At no time during this period did Burton state that he was being mistreated by Collins-Rector, Shaekley, or me, in any way, and to the best of my knowledge and infonnation, Buiton?s consensual romantic relationship with Shackley continued during this period of time. 10. In late 1999, Collins-Rector, Shaekley and I began to suspect that someone was ?leaking? private information ccnceming us and con?dential business inforrnatiorr concerning DEN to competitors and the public. We hired private investigators to determine the source of such ?leaks.? ll. On or about December 26, 1999, Burton, Collins-Rector, Shackley and I traveled back to Los Angeles, Califomia, where we remained for a brief visit. At no time during this period did Burton state or otherwise indicate that he believed that he had been sexually abused by Collins- Rector, Shackley, or me; nor did he make any fLl1'ih6I' mention of his apparent plan to extort money from Collins-Rector or nor did he state that he was being mistreated by us in any way. To the best of my knowledge and information, Burton?s consensual romantic relationship with Shaclcley continued during this period of time. 12. On or about January 9, 2000. Burton, Collins-Rector, Shackley and I traveled back to France, where we remained for some weeks. At no time during this period did Burton state or otherwise indicate that he believed that he had been sexually abused by Collins?Rector, Shackley, or me; nor did he make any further mention of his apparent plan to extort money from Collins-Rector or nor did he state that he was being mistreated by us in any way. To the best of my knowledge and information, Bui-ton?s consensual romantic relationship with Shackley continued during this period of time. 13. At some point in early 2000, Burton, Collins-Rector, Shackley and I returned again for a brief visit to Los Angeles, California. At no time during this period did Burton state or otherwise indicate that he believed that he had been sexually abused by Collins-Rector, Shockley, or me; nor did he make any further mention of his apparent plan to extort money from Collins-Rector or nor did he state that he was being mistreated by us in any way. To the best of my knowledge and 3 DECLARATION IN SUPPORT OF MOTION TO SET ASIDE DEFAULT JUDGMENT I :91 I ?I-nil information, Burton?s consensual romantic relationship with Shackley continued during this period of time. 14. In April or May 2000, Collins-Rector, Shackley, Burton and I traveled to Florida, where we lived for approximately one month. During our visit to Florida, Collins-Rector, Shackley and I discovered, through a search of the personal computer than Burton had been using, that Burton had been the source of the leaks of con?dential and private information concerning us and DEN to competitors and the public. We confronted Burton about his misconduct, whereupon Burton became agitated and stormed out of the house and, to the best of my knowledge and infonnation, returned to the Los Angeles area. At that time, Burton did not state or otherwise indicate that he believed that he had been sexually abused by Collins-Rector, Shackley, or me; nor did he make any put i mention of any plan to extort money from Collins-Rector or nor did he state that he had been 1-: I9 mistreated in.any way by Collins-Rector, Shackley, or me. This was the last direct contact we had I-3 hi with Burton. --L -It 15. On or about May 20, 2000, Collins-Rector, Shacl-rley and I moved to Marbella, Spain. r-A At the time we left for Spain, none of us had any idea that Burton was planning to ?le suit against I-H any of us. Furthermore, as of this time, Burton had never given us any indication whatsoever that he I--I --J had been sexually abused or mistreated 16. According to court records, in July 2000, the present action (this ?Action") was I--I N-D commenced by Burton and others against DEN, Collins?Rector, Shackley, myself and several other IN) individuals, two months after the above?described incident in Florida between us and Burton. At that INJ time, as mentioned above, we had already left the country and taken up residence in Spain. We IQ IQ continued to live abroad for approximately two?and?a half years thereafter. IO La 17. Eventually, while living overseas, in late 2002, a ?iend mentioned to me that, -F sometime earlier, he had seen a news article that indicated that a several million dollar judgment had I0 u- been entered against Collins-Rector, Shackley and me in a civil matter back in the Los Angeles area. Ix.) ON I eventually obtained a copy of that news article, and became concerned about the litigation that --J apparently had been commenced against us, so lretumed to the United States to investigate the (0 O0 situation. Shortly thereafter, on or about February 25, 2003, I obtained a copy of the Court?s ?Case 4 SUPPLEMENTAL DECLARATION IN SUPPORT OF MOTION TO SET ASIDE DEFAULT JUDGMENT 992.. UN I 6tiEZt72E9ttI L6 9 I HFIUEIL VS =9 1 History Report? in this Action, and learned that a default judgment had been entered against me in 2 this Action. 3 18. I had no idea that I might have been named as a party to any civil action in the United 4 States until Iread the aforementioned news article in late 2002, and 1 had no actual notice of this 5 Action until on or about February 25, 2003, when I obtained the ?Case History Report? in this Action. In particular, I had no reason to suspect that Burton was planning to initiate litigation against me, since I saw him on a daily basis from late 1999 to May 2000 the period ending a mere two months before Burton initiated this Action), during which time he never gave me any indication that he believed that he had been sexually abused by Collins-Rector, Shackley, or me, nor that he had 10 been mistreated in any way. in fact, lbelieve that this Action is the manifestation of Burton?s 11 scheme (?rst mentioned to me in France in late 1999) to extort money ?orn DEN and/or Collins- 12 Rector and, moreover, that Burton only named me as a defendant in this Action because of my 13 opposition to and stated refusal to participate in his extortion plot against DEN and Collins~Rector. 14 19. My lack of actual notice of this Action was not due to avoidance of service or 15 inexcusable neglect on my part. I left the country before commencement of this Action for legitimate 16 reasons, I had no reason to suspect that I would be named as a defendant in any such action at the 17 time I left the country, despite my above-described daily contact with Plaintiff Burton until the ?eve? 18 of litigation two months before L886 QSL SI DECLARATION IN SUPPORT MOTION TO SET ASIDE DEFAULT JUDGMENT UN 9 I EIFIUHL VS 9T 73 1 ?ling). I never had an)? actual knowledge 0f the ?f1hiS A?ti?n ?mil on or about February 2 25, 2003. 3 20. I did not have actual notice of this Action in time to the Action- 4 I deem; under pgnalty of pexjury under the laws of the State ofCa1ifon1ia that the foregoing is true and correct, 5 and ifcallcd as a witness, I would and could testify as to the accuracy of such statements. 6 Executed this ?ay ofluly, 2003 7% PIERCE 1994.-QN "mt hum AR ATION IN SUPPORT 061? MOTION TO SET ASIDE DEFAULT IUDGMENT 6