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                  UNITED STATES BANKRUPTCY COURT

    

             FOR THE NORTHERN DISTRICT OF CALIFORNIA

    

         BEFORE THE HONORABLE ARTHUR S. WEISSBRODT, JUDGE

    

     In Re:                             ) Case No. 98-51326-ASW

                                        ) Chapter 13

                                        )

     HOWARD KEITH HENSON,               )

                                        ) TRIAL

                                        ) Volume IV

                         Debtor.        ) Pages 493 to 725

                                        )

                                        )

                                        ) Wednesday, October 2, 2002

                                        ) San Jose, California

    

     Appearances:

    

     For the Debtor:          Law Offices of Stanley A. Zlotoff

                              By:  Stanley A. Zlotoff, Attorney at Law

                              300 South First Street, Suite 215

                              San Jose, California  95113

    

     For Creditor Religious   Moxon & Kobrin

     Technology Center:       By:  Helena K. Kobrin, Attorney at Law

                              3055 Wilshire Boulevard, Suite 900

                              Los Angeles, California  90010

    

                              McPharlin, Sprinkles & Thomas

                              By:  Elaine M. Seid, Attorney at Law

                              10 Almaden Boulevard, Suite 1460

                              San Jose, California  95113

    

                              Paul, Hastings, Janofsky & Walker LLP

                              By:  Samuel D. Rosen, Attorney at Law

                              75 East 55th Street

                              New York, New York  10022-4597

    

     For Witness Lucas:       Howard Hibbard, Attorney at Law

    

     Electronic Court         United States Bankruptcy Court

     Recorder:                Clerk of the Court 

                              Liz Armendariz

                              280 South First Street, Room 3035

                              San Jose, California  95113

                              (408) 535-5003

    

     Certified Electronic     Palmer Reporting Services

     Transcriber:             P. O. Box 30727

                              Stockton, California  95213-0727

    

            Proceedings recorded by digital recording;

          transcript produced by federally-approved transcription

service.                             I N D E X

    

    

     Debtor's Objections to Creditor's Exhibits:       page 495

    

     Court's Decision on Debtor's Objections and

      Creditor's Exhibits:                             page 506

    

     Agreements of the Parties:                        page 595

    

    

    

    

     Witnesses:

                              Direct   Cross   Redirect   Recross

         

     Victoria Arel Lucas

    

      By Mr. Rosen:                    

      (Resumed):                        540

                                        605

    

      By Mr. Hibbard:                   689

    

      By Mr. Zlotoff:                             689

    

      By Mr. Rosen:                                         709 

    

    

    

    

     Exhibits:                               Received in Evidence

    

    

     Creditor's Exhibit 290:                           page  523

    

     Creditor's Exhibit 292:                           page  671

    

    

     Debtor's Exhibit R:                               page  534

    

     Debtor's Exhibit S:                               page  535

    

     Debtor's Exhibit O:                               page  536

    

     Debtor's Exhibit P:                               page  536

    

     Debtor's Exhibit Q:                               page  537

    

    

    

    

    

    

                                                                     495

 

 1        Wednesday, October 2, 2002                 9:13 o'clock a.m.

 

 2                    P R O C E E D I N G S

 

 3             THE CLERK:  Please rise.  This is the United States

 

 4   Bankruptcy Court for the Northern District of California.  Court

 

 5   is now session.

 

 6             THE COURT:  Good morning, ladies and gentlemen.  Sorry

 

 7   for the brief delay.  I had something I had to take care of.

 

 8             This is the case of Keith Henson.

 

 9             May I have appearances of counsel?

 

10             MR. ZLOTOFF:  Stan Zlotoff for debtor.

 

11             MR. ROSEN:  For Religious Technology Center, Samuel D.

 

12   Rosen, Paul, Hastings, Janofsky and Walker.

 

13             MS. KOBRIN:  Also for Religious Technology Center,

 

14   Helena Kobrin, Moxon and Kobrin.

 

15             MS. SEID:  Elaine Seid of McFarland, Sprinkles and

 

16   Thomas, also for Religious Technology Center.

 

17             THE COURT:  Good morning.

 

18             Are you ready to present your argument?

 

19             MR. ZLOTOFF:  Yes, Your Honor.  I think the easiest

 

20   way to do this would be if you - if you have a copy of Mr.

 

21   Rosen's brief.

 

22             THE COURT:  I do.

 

23             MR. ZLOTOFF:  Okay.  And then we have certain

 

24   headings.  And so the first headings is at page 6.  And actually

 

25   the first exhibits of interest are on page 7.  There's nothing

 

                                                           496

 

 1   that's really stated before page 7 that's of any pertinence at

 

 2   all to the exhibits.

 

 3             On page 7, these are - these are all objectionable

 

 4   with the exception of 168.  They're - all of these references,

 

 5   that is Exhibits 121, 124, 140, 142, 159, 230, 231, 232, 266,

 

 6   267, 268, those of the ones that I had objected to.  And all of

 

 7   those represent postings at one time or another by Mr. Henson.

 

 8   And you can gather from certain quotations set forth here the

 

 9   general tenor of those postings.

 

10             For example 140:  The excerpt is "Killing the

 

11   organization off entirely is the best way to change the future

 

12   of Scientology."

 

13             Number 230, Exhibit 230:  "Activities of Henson and

 

14   his cronies will only end when Scientology is ground into the

 

15   dirt or spent its last dollar on lawyers."

 

16             266:  "We are out to break the COS."

 

17             268:  "The annihilation of COS and all its fronts is a

 

18   worthy goal."

 

19             All those to my mind are free speech.  I mean they

 

20   might be cartoonish.  To my mind it's a bit like the Wiley

 

21   Coyote complaining that the Roadrunner - or I guess the reverse

 

22   - the Roadrunner complaining the Wiley Coyote's after him, but

 

23   it's cartoonish.

 

24             I mean to me it makes no difference; except the only

 

25   way it could possibly be relevant is if these are supposed to be

 

                                                           497

 

 1   bad acts and based upon these bad somehow we're supposed to

 

 2   infer some kind of what?  Bad faith Chapter 13 character that is

 

 3   somehow relevant to the issue of confirmation.

 

 4             In other words, none of these postings have anything

 

 5   to do with the debt that RTC holds.  None of them have to do

 

 6   with any kind of budgetary analysis.  None of them have to do

 

 7   with any net worth.  They're just ramblings by somebody on the

 

 8   Internet.

 

 9             168 was also objectionable, but that's not a posting.

 

10   That's the protective order.  And again it was a protective

 

11   order entered in either the District Court case or related

 

12   District Court case.  And the protective order was granted, I

 

13   believe, to exclude Mr. Henson from the deposition because of

 

14   some alleged threats that someone had perceived had been made.

 

15             And again to the extent it has any interest it's to

 

16   approve an alleged bad act or conduct on behalf of Henson at

 

17   some time in the past, utterly unrelated to either the debt

 

18   that's before the Court or anything having to do with the

 

19   Chapter 13.  And it's totally irrelevant for that purpose.

 

20             THE COURT:  Why don't you complete your argument as to

 

21   all the exhibits?

 

22             MR. ZLOTOFF:  Okay.  I'm going forward.

 

23             Number 257.  If you down the page under the next

 

24   heading, "Contempt and threatened contempts."  257 is just

 

25   another internet posting, which to me is nothing other than free

 

                                                           498

 

 1   speech and not objectionable for the same reasons I indicated.

 

 2             I didn't have - a lot of these I didn't have any

 

 3   objection to.  Can I just state the ones I have objection to?

 

 4             THE COURT:  Sure.

 

 5             MR. ZLOTOFF:  Because they pretty much wrote out a

 

 6   trial brief rather than just limiting their objections to the

 

 7   ones that I had a problem with.

 

 8             Number 22.  At the bottom, Exhibit 22, I withdraw - I

 

 9   withdraw any objection for that.

 

10             THE COURT:  What page of their brief is Exhibit 22?

 

11             MR. ZLOTOFF:  I'm sorry.  What page of their brief?

 

12   It's page 7.

 

13             THE COURT:  Yeah.  You're asking me to follow their

 

14   brief, and I'm trying -

 

15             MR. ZLOTOFF:  Yeah, I'm sorry.

 

16             THE COURT:  - trying to follow.

 

17             MR. ZLOTOFF:  That's page 7 at the bottom.

 

18             THE COURT:  Oh, yes, I see it.  Excuse me a second.

 

19             Ms. Lucas, I noticed that you just came into the

 

20   courtroom.  We are going to be dealing with these legal issues

 

21   about the exhibits for at least another 20, 25 minutes.  So if

 

22   you need to make calls or do anything, we can come out in the

 

23   hall and find you.

 

24             MR. ROSEN:  Your Honor, may I refer you to the back of

 

25   the brief which has the equivalent of the table of authorities -

 

                                                           499

 

 1             THE COURT:  You need your mic, to be at your mic.

 

 2             MR. ROSEN:  - which has the equivalent of a table of

 

 3   authorities, functionally.  So, for example, on the question you

 

 4   just asked, obviously if after - when you consider these in your

 

 5   chambers, if you have any questions of the kind that was just

 

 6   asked, you'll see that Exhibit Number 22 appears on page 7.

 

 7   That's what the table in the back is for.  So Your Honor can

 

 8   locate it in the brief.

 

 9             MR. ZLOTOFF:  Your Honor, actually you don't even know

 

10   the ones that I made objection to.  So it's - why don't I just

 

11   not even mention 22 and you just assume that there's no issue on

 

12   that.  I think that would be easiest way to proceed.

 

13             THE COURT:  I do know from a footnote.

 

14             MR. ZLOTOFF:  Oh, that's right, you're right.  Okay.

 

15   I withdraw any objection to 22.

 

16             On the next page, page 8, Exhibit 80 - I'm sorry

 

17   Exhibit 25 is withdrawn.  No objection as to 25.

 

18             Exhibit 80, Exhibit 269, 270, 274 are still

 

19   objectionable on relevance grounds.  They're postings.  And

 

20   again to me they just evidence free speech.  Or if they suggest

 

21   bad conduct, it's irrelevant to prove some kind of character

 

22   that's wrongful with regard to Chapter 13.

 

23             Exhibit 274.  I have no objection to 274.  I'm not

 

24   sure whether that was one of the ones I objected to or not.

 

25             MR. ROSEN:  Yeah.

 

                                                           500

 

 1             MR. ZLOTOFF:  It was?  I withdraw objection to 274.

 

 2             Then the next batch is Number 3 on page 8:  "Henson's

 

 3   repeated efforts to derail the copyright trial."  I don't have

 

 4   any objections in that category - in that - under that heading.

 

 5   So either I didn't make objections as to the ones indicated or I

 

 6   withdraw whatever objections I may have had.

 

 7             Is that clear, Your Honor?

 

 8             THE COURT:  I guess so.  It's 9 and 4.

 

 9             MR. ROSEN:  And 6, Judge.

 

10             THE COURT:  Yes.

 

11             MR. ROSEN:  He didn't object to any of those.  And

 

12   also 7, I see.  It's on line 14 under - in that heading.  No

 

13   objection to that one either.  And 8 on line 16, no objection to

 

14   that one either.

 

15             MR. ZLOTOFF:  The next heading, Number 4, on page 8.

 

16   No objections in that category.  So I did have an objection to

 

17   256 earlier; that's withdrawn.  And the other exhibits indicate

 

18   I never objected to in the first place.

 

19             The next heading on page 9 is Heading Number 5.  And

 

20   this gets into - the first paragraph Exhibits 5 and 258 are

 

21   exhibits pertaining to other trials or orders made in other

 

22   cases.  And to me for that reason they lack relevance to this

 

23   particular case.

 

24             Exhibit 96 is a posting that to me again is nothing

 

25   other than free speech posting and doesn't suggest one thing or

 

                                                           501

 

 1   the other.  And for that reason it is irrelevant, as with the

 

 2   next paragraph on page 9.  So that would include Exhibits 94,

 

 3   93, 81 and Exhibits 147 to 158.  They're all free speech

 

 4   postings.  And, you know, he's talking about the amusement value

 

 5   of the litigation and explaining his picketing activities and so

 

 6   forth.  And it's, you know, it's - it's irrelevant.  I don't see

 

 7   any point to - it has to the trial.

 

 8             The last paragraph are a series of exhibits that

 

 9   pertain to the criminal trial.  And, remember, the criminal

 

10   trial happened postpetition.  I think a couple of years

 

11   postpetition, regarding postpetition conduct.  Mr. Henson at

 

12   some kind of a Scientology or RTC headquarters, I think, in

 

13   Riverside.  It's irrelevant.

 

14             I don't understand why any kind of - it was a

 

15   misdemeanor conviction, as I recall.  So, in the first place, I

 

16   don't think misdemeanor convictions are admissible.  It's

 

17   irrelevant because it doesn't bear on either the debt or assets

 

18   or any pertinent confirmation standard.  To the extent that it

 

19   shows anything that RTC is trying to squeeze into a relevancy

 

20   category, it's that he was a bad person, he committed a bad act,

 

21   therefore he again has some kind of character flaw that carries

 

22   into Chapter 13.  And so he must be doing bad things while in

 

23   Chapter 13.  To me it just doesn't follow.

 

24             And you - as a matter of law, as I recall - Mr. Rosen

 

25   I'm sure will correct me on my evidence, but I don't think you

 

                                                           502

 

 1   can prove character from an instance of bad conduct.

 

 2             So, anyway, we were talking here about again the last

 

 3   paragraph on page 9.  This will be Exhibit 183, misdemeanor

 

 4   complaint; 129 a docket sheet; 260, again having to do with the

 

 5   criminal trial.  And also 134.  I'm on page 10 now.

 

 6             THE COURT:  Um-hum.

 

 7             MR. ZLOTOFF:  Exhibits 133, 134, 135, 141, they're all

 

 8   postings.  And to me, looking at them without any narrative

 

 9   supplied by RTC, they're just postings, again free speech.  RTC

 

10   tries to tie them in by saying, 'Well, they were part of the

 

11   criminal trial.'  And again I say so what.  They were a part of

 

12   the criminal trial, not relevant.

 

13             On that line, line 8, page 10, 164 to 167 and 261 to

 

14   262.  Again I read them and I - I just see free speech.  I don't

 

15   even see context to them.  I mean they're just - some of are

 

16   just two sentences long that don't have any significance to me

 

17   at all - except RTC supplies a context and says they were used

 

18   in the criminal trial.  And I say, okay, if they were used in a

 

19   criminal trial, so what, they're still irrelevant.

 

20             The next line down, 273, is the dismissal of his

 

21   criminal appeal.  And I say so what.  It's irrelevant.  I don't

 

22   care about the criminal appeal or that it was dismissed based on

 

23   the fugitive disentitlement doctrine.  We've already talked

 

24   about fugitive disentitlement in the Degan case and how that's

 

25   not - it's not relevant in our circumstance here.

 

                                                           503

 

 1             The next paragraph, again Exhibit 250.  It's something

 

 2   from the criminal case.  Not relevant for that reason.

 

 3             Exhibit 249, the next sentence again, that's from the

 

 4   criminal case and not relevant to this proceeding.

 

 5             The next paragraph at line 15 of page 10, Exhibit 114

 

 6   pertains to a tax case that Mr. Henson filed against RTC.  It

 

 7   may be interesting, but I don't see the relevance at all.  I

 

 8   mean certainly someone has got a constitutional right to file a

 

 9   lawsuit, rightly or wrongly.  I don't see what it proves one way

 

10   or the other.

 

11             Exhibit 233, the same thing.  It has to do with R- -

 

12   with Henson's action against the RTC.

 

13             The next batch is headed Number 6, "Inaccurate

 

14   Schedules."  I have no objection to anything in that category -

 

15   I'm sorry - on that page.  On page 10, on that category, I don't

 

16   have any objection.  In fact, I don't have anything in that

 

17   whole heading except for Number - this is on line 6 of page 11,

 

18   215 and 216 just appear to be postings without free - again free

 

19   speech postings without any particular context that makes any

 

20   significance, so far as I can see.

 

21             But except for those two, the remainder of the

 

22   exhibits noted, if I had an objection I withdraw the objection,

 

23   otherwise I didn't have objection.  And RTC just chose to ramble

 

24   on about the - about these exhibits.

 

25             THE COURT:  Okay.

 

                                                           504

 

 1             MR. ZLOTOFF:  Turning to page 12, the next heading is

 

 2   Number 7.  I have no objection to anything - any evidence or any

 

 3   exhibit mentioned in that heading, nor did I ever.

 

 4             Down the page on heading 8, there's nothing on page

 

 5   12.

 

 6             On page 13, there's a footnote, which is footnote 11,

 

 7   in which is noted Exhibit 95.  I withdraw the objection I had to

 

 8   Exhibit 95.  I didn't - I don't think I ever had an objection to

 

 9   Exhibit 98 mentioned right next to it.  Nor did I to the other

 

10   exhibits noted.

 

11             Back to the top of the page on page 13 -

 

12             THE COURT:  14?

 

13             MR. ROSEN:  No, page 13, the top of the page 13.

 

14   Again, we're on -

 

15             THE COURT:  I see.  Yeah, because you went to the

 

16   footnote.

 

17             MR. ROSEN:  - Heading 8.  Exhibits 125 and 126 pertain

 

18   to model plans.  And to me those are irrelevant.  And they're

 

19   irrelevant because I could take a model plan, I could cross out

 

20   lines and add lines.  And, you know what, I'd end up with our

 

21   model plan.  And what difference does it make?  What does it

 

22   prove?  What does it show?

 

23             You could do anything with the plan and the issue is

 

24   what's in a plan and was it objected to?  And that's all.  I

 

25   mean the fact that somebody uses one form or another doesn't

 

                                                           505

 

 1   mean you can't add or delete to a model plan.  And so the issue

 

 2   is really what's before the Court; and the others are utterly

 

 3   irrelevant.  They don't prove anything.  The other exhibits

 

 4   noted I had no objection to, in any event.

 

 5             Going to the next heading, Number 9, "Misconduct."  No

 

 6   objections to anything in that batch.  I had objected to 222 and

 

 7   224 to 226.  I withdraw my objections to those.  The others

 

 8   noted, I don't think I had any objection to, to begin with.

 

 9             Page 14, the next heading, Heading 10.  No objections.

 

10   Again, I don't think I had any to begin with in that - in that

 

11   series.  Oh, I'm sorry, except for again at the bottom, 215 and

 

12   216.  I previously noted as they were in another - another

 

13   heading.  So except for Exhibits 215 and 216, which are noted at

 

14   the bottom of page 14, I don't have any objection to any of the

 

15   other exhibits noted.  And the 215 and 216 were postings,

 

16   Internet postings which I contend are just free speech.

 

17             Page 15, Heading 11, I have no objections to anything

 

18   in that.  If I objected to 272, I withdraw that.  The others I

 

19   don't think I objected to, to begin with.

 

20             Heading Number 12, I had no objection, to begin with,

 

21   with anything in that column.

 

22             Heading 13 on page 15, the last one.  Again, all of

 

23   these indicated here have to do with - I think almost all of -

 

24   are more recent postings.  And to me they're just free speech

 

25   postings.  We're talking about 2- - Exhibit 253, 254, 188, 238,

 

                                                           506

 

 1   251, 255, and 265.  And those are all again free speech postings

 

 2   and not relevant.  And that's...

 

 3             THE COURT:  I know you are ready to argue, Mr. Rosen.

 

 4             Are you finished, Mr. Zlotoff?

 

 5             MR. ZLOTOFF:  I think so, yes.

 

 6             THE COURT:  But I intended to admit almost all of

 

 7   these documents.  Maybe you ought to hear my decision before you

 

 8   make an argument.

 

 9             Essentially all of the exhibits - and I'm not able to

 

10   switch back and forth between what was in the footnote, what

 

11   RTC's brief says, and what you just said.  So I'm going to have

 

12   to do this more broad brush.  But essentially they're almost all

 

13   admitted.

 

14             I'm faced with the totality-of-the-circumstances test

 

15   which I have to apply.  And that includes Mr. Henson's alleged

 

16   motive for filing bankruptcy.  RTC says it's not to reorganize

 

17   but to continue to harass the creditor and to try to destroy the

 

18   creditor by stopping the District Court trial, and running up

 

19   the creditor's expenses, et cetera, et cetera, is alleged

 

20   manipulation of the bankruptcy law to suit his own alleged

 

21   purposes of destroying the church, his alleged overall disregard

 

22   of the law.

 

23             And so essentially all of this comes in under the

 

24   totality-of-the-circumstances test, both the prepetition conduct

 

25   and the postpetition conduct, under the caselaw.

 

                                                           507

 

 1             Mr. Zlotoff has alleged that certain, especially

 

 2   postings, but perhaps other documents are free speech.  And I

 

 3   make no ruling on Mr. Henson's free speech.  The fact that it

 

 4   may be - Mr. Henson may be entitled under the free speech

 

 5   doctrine to write something really is not what I'm focusing on.

 

 6             What I'm focusing on is whether or not, under the

 

 7   totality-of-circumstances test, a statement, a posting, a

 

 8   writing, essentially any - any of these documents come in under

 

 9   the totality-of-the-circumstances test, and I think that they

 

10   do.

 

11             There - and I can go through some of these, but

 

12   certainly what happened vis-a-vis the criminal trial, what

 

13   happened in these postings, and what happened in the District

 

14   Court are admissible under the totality-of-the-circumstances

 

15   test.  The weight is a different matter, but I'm not going to

 

16   the weight at this point.  I'm only talking about what's

 

17   admissible.

 

18             Exhibits 125 and 126 are model plans from other

 

19   districts and information regarding those model plans.  Those

 

20   aren't relevant to whether the debtor acted in bad faith by

 

21   using the model plan that he's required to use in this district.

 

22   And efforts to avoid a lien as an impairment of a homestead

 

23   objection - homestead exemption, which the Bankruptcy Code

 

24   specifically permits, is not relevant to whether bankruptcy was

 

25   filed in bad faith.  So those don't come in.  In fact, there's

 

                                                           508

 

 1   no knowledge that Mr. Henson even knew about the model plans in

 

 2   any other district.

 

 3             MR. ROSEN:  What exhibit are you referring to?

 

 4             THE COURT:  I think they're 125 and 126.

 

 5             MR. ROSEN:  No, I know those as the model plans.  But

 

 6   you then said efforts to avoid a lien.  Do you have an exhibit

 

 7   that you are referring to, Your Honor?

 

 8             THE COURT:  I don't have a number.  I think it's 122

 

 9   and 187, and the claims filed by the creditor, 194 and 195.  But

 

10   I believe 122 and 187 involve efforts to avoid the creditor's

 

11   lien.

 

12             MR. ROSEN:  I don't - I don't believe so, Judge.

 

13             THE COURT:  Well, we'll check.

 

14             MR. ROSEN:  Okay.

 

15             THE COURT:  We'll check.  But, in any event, the - and

 

16   again, Mr. Zlotoff, I'm not able to go through all of the ones

 

17   that you've withdrawn.  So I may discuss some of the ones that

 

18   you've withdrawn an objection to, or which were not listed in

 

19   your footnote but were referred to in RTC's brief.  But under

 

20   the time I did the best that could.

 

21             The - Exhibit 275, page - is submitted to show the

 

22   debtor allegedly knew before publishing the creditor's work,

 

23   that it was copyrighted, and someone else had been enjoined from

 

24   publishing it, but went ahead and published it anyway.

 

25             Exhibit 1 is a de- - cease-and-desist letter to the

 

                                                           509

 

 1   debtor.  2 is his refusal to stop.  99 is the District Court

 

 2   summary judgment for the creditor.  3 is the June '97 permanent

 

 3   injunction.

 

 4             The District Court trial was May 5th, '98.  Exhibit 20

 

 5   are trial excerpts of a tape played for the jury.  213 is a tape

 

 6   and transcript of excerpts played.

 

 7             21 is debtor's answer to his attorney's question as to

 

 8   whether he had been deterred from doing it again, "At least I

 

 9   wouldn't do it openly."

 

10             36 is jury instruction regarding willfulness.  18 is

 

11   the jury's special verdict finding, willfulness.  173 is the

 

12   District Court judgment.  115 is the Ninth Circuit order

 

13   affirming.

 

14             100 is the Ninth Circuit order awarding creditor fees

 

15   for deterrence purposes.

 

16             Exhibits 112, 113, 116, 121, 124, 140, 142, 159, 168,

 

17   184, 213, 229, 230, 231, 232, 266, 267, 268, 275, and 279 are

 

18   statements by the debtor introduced to demonstrate his desire to

 

19   destroy the Scientology religion by various means.

 

20             107, 257, and 10 are debtor's alleged threats to

 

21   violate the injunction.  Exhibit 109 is the District Court's

 

22   order expanding the injunction.

 

23             210 is this Court's order of relief from stay to allow

 

24   the creditor to go to state court regarding debtor's alleged

 

25   contempt of the injunction.

 

                                                           510

 

 1             12 is the District Court order granting emergency

 

 2   relief to stop threatened violation.  111 are findings of fact

 

 3   by the District Court regarding contempt.

 

 4             22 is the District Court contempt order.  25 is the

 

 5   Ninth Circuit Court order affirming.  80 is debtor's statement

 

 6   blaming other parties for those orders.

 

 7             269, 270, and 274 are recent statements by the debtor

 

 8   allegedly showing violation of injunction and intent to drive up

 

 9   creditor's cost to enforce.

 

10             Exhibit 4 allegedly shows the District Court trial was

 

11   originally set for 12-97.  And the debtor originally dated his

 

12   bankruptcy petition 12-1-97.

 

13             Exhibit 4 is the District Court's continuation of

 

14   trial due to its own schedule.  Exhibit 6, 7, and 8 are debtor's

 

15   attempts to continue the trial again.  9 is the bankruptcy

 

16   petition filed after the continued efforts - the efforts to

 

17   continue failed.

 

18             256, the debtor's Bankruptcy Court notice to the

 

19   District Court within a very short time after filing bankruptcy.

 

20   209 is the Bankruptcy Court's March 23, 1998 relief-from-stay

 

21   order permitting the District Court to proceed.

 

22             211 is the debtor's notice of voluntary dismissal of

 

23   the bankruptcy case on March 24, '98.

 

24             5 and 28 - 5 and 258 are restraining orders issued

 

25   October '97 and December '97 to prevent the debtor from

 

                                                           511

 

 1   harassing and picketing.

 

 2             96 and 91 are the debtor's expression of appreciation

 

 3   to those who supported picketing, and requests for additional

 

 4   help.

 

 5             94 and 93 are debtor's statements about amusing

 

 6   himself and others at creditor's expense.

 

 7             Exhibits 279 is his deposition about his picketing.

 

 8   Exhibits 147 through 158 are statements by the debtor about his

 

 9   picketing.

 

10             Exhibit 183 is a misdemeanor complaint which, of

 

11   course, isn't for the truth, but is relevant.  129 is a docket

 

12   sheet from that criminal case.

 

13             269 is part of the trial transcript from that case of

 

14   what the debtor did and why he did it.  Exhibits 133, 34, 35 and

 

15   141, and 164 through 167 and 261 and 262 are published

 

16   statements by the debtor that were exhibits at the criminal

 

17   trial.

 

18             273 is a dismissal of the debtor's appeal from

 

19   conviction.  250 and 264 showed jury conviction of a hate crime.

 

20   249 shows sentencing.

 

21             114 is the District Court's dismissal of the debtor's

 

22   suit against IRS seeking to revoke Scientology Church tax-exempt

 

23   status.  233 is the Ninth Circuit's order affirming.

 

24             Exhibit 16 is the debtor's original schedules.  2 - 27

 

25   are amended schedules.  Other information - other exhibits

 

                                                           512

 

 1   attack the information in the schedules.

 

 2             Exhibit 16 and 277 allegedly show that the house - the

 

 3   value of the house is the purchase price.  91 is an appraisal

 

 4   purporting to show it to be worth less - I'm sorry - more on the

 

 5   date of bankruptcy.

 

 6             81 through 83 and 93, 94, 96, 189, 215, 216, 276, 277,

 

 7   278, and 279 are statements by the debtor that he's received

 

 8   money from others that allegedly were not scheduled as assets.

 

 9             279 and 179 allegedly show that the daughter's school

 

10   expenses are much higher than scheduled, which - and which were

 

11   paid by a credit card.

 

12             98, 278 - 98 and 278 are offered to show that the

 

13   scheduled phone expense is 50 percent of what it really is.

 

14             Exhibits 35, 47, 56, 67, 177, 178, 191, 286, 278

 

15   allegedly show that he denied having a life insurance policy

 

16   with cash value.

 

17             Exhibit 276 is allegedly his denial that he owns

 

18   artwork, but Exhibit 89, 160, 234 allegedly show that he does.

 

19             Exhibit 221, 89 show - allegedly show that he owns

 

20   stock bought shortly prepetition that isn't scheduled.  276 and

 

21   279 are his admissions that he had a credit card or credit cards

 

22   when he filed - or credit card.  And allegedly shows that he

 

23   purposely didn't disclose it.

 

24             Exhibit 278 and 279 are tax returns, allegedly without

 

25   certain information.  171 is his effort to explain.

 

                                                           513

 

 1             174 is an application to the District Court for pauper

 

 2   status.  277 is - allegedly is Mr. Henson's admission that the

 

 3   information - that it isn't correct.

 

 4             Exhibit 187 shows the debtor suffered to sell his

 

 5   house without marketing it, without notice to creditors, the

 

 6   trustee, or the Court.  That's what it's intended to show.

 

 7             Exhibit 18, 28, 92 are proposed plans allegedly

 

 8   offering nothing to the creditor after administrative expenses

 

 9   are provided for.

 

10             122 and 187 are the ones, I believe - and we'll check

 

11   those - reflecting efforts to avoid the creditor's lien under

 

12   the Bankruptcy Code.  And we should check those.

 

13             And then I talked about 125 and 126.

 

14             The debtor's conduct in discovery is part of the

 

15   circumstances alleged to show his bad faith.  And that's 13, 14,

 

16   29, 35, 37, 39 to 44, 46 to 48, 53, 59, 61, 62, 64, 65, 66, 67,

 

17   68, 69, 72, 73, 75, 86, 222, 224, 225, 226, 276, 277, 278, 279,

 

18   30, 31, 32, 33, 34, 59, 61, 78, 97, 122.

 

19             He allegedly admitted he destroyed relevant records

 

20   rather than produce them in discovery and/or to the IRS, Exhibit

 

21   279, 58, 60, 61, 75, 81, 83, 93, 94, 96, 215, 216, 279.

 

22             He allegedly caused himself to be under unemployed,

 

23   and that's relevant, 84, 275, 272, 278, 279, 76, 77, 278.

 

24             279 shows the debtor making what is characterized by

 

25   the creditor as an extortionate - extortionate demand on the

 

                                                           514

 

 1   creditor.

 

 2             253 is debtor's statement from Canada regarding

 

 3   whether he will return or not.

 

 4             254 is his statement complaining about his criminal

 

 5   case.

 

 6             188 is his statement about being in Canada.

 

 7             238 is a letter saying he won't appear for sentencing.

 

 8   251 shows that he didn't appear.

 

 9             255 and 265 are his statement that he was arrested in

 

10   Canada for having entered without revealing his fugitive status.

 

11   And they are introduced to attempt to show that he continues to

 

12   mock the law.

 

13             Now let's turned to 125 and 126 -

 

14             MR. ROSEN:  Your Honor, I think I can save you some

 

15   time.  The first two that you are not - I gather from your

 

16   comments, are not admitting because you don't believe they're

 

17   relevant, are 125 and 126, those are the model plans.  Let me -

 

18   those are a matter of public record.  But let me just -

 

19             THE COURT:  Sure.

 

20             MR. ROSEN:  - tell you why they were offered.

 

21             It was our recollection that Your Honor, not in a

 

22   ruling but in rumination, in comments from the bench a long time

 

23   ago in this case, had indicated that under the model plan of

 

24   this district the valuation date for the house, which under the

 

25   statute is the effective date of the plan, is the date of the

 

                                                           515

 

 1   filing of the petition.  Your Honor is going to have to decide

 

 2   that issue at some point.  I don't know necessarily in this one

 

 3   or in the next motion.

 

 4             But assuming Your Honor needs to decide, we put this

 

 5   in only to show the model plans of other districts in the

 

 6   following way:  If Your Honor were to write a decision which

 

 7   says the model plan of this district says this and therefore I'm

 

 8   going to follow it, we would want the record to show that the

 

 9   model plans of other districts don't follow it.  If Your Honor

 

10   has no intention of doing that, and saying as you just did, the

 

11   model plan is a model plan, and both debtors and the Court are

 

12   free to ignore it, to follow it, do whatever they want, then the

 

13   other plans in the other districts are indeed irrelevant.

 

14             But we put it in only because it appeared to us that

 

15   Your Honor's nonbinding comments, if you will, of observations

 

16   on the subject in the past, were that this is what your - the

 

17   model plan in this district says.

 

18             So with that understanding, if Your Honor wants to

 

19   exclude them, they're matters of public record anyway.  But

 

20   that's the only purpose that we put them in for.  That's 125 and

 

21   126.

 

22             Respecting 122, Your Honor, it's a transcript -

 

23             THE COURT:  I need to get it before you start talking.

 

24        (Pause in the proceedings.)

 

25             THE COURT:  Had you objected to 122 and 187?

 

                                                           516

 

 1             MR. ROSEN:  He objected to neither.

 

 2             THE COURT:  Okay.  So there's no issue, they come in.

 

 3             MR. ROSEN:  Okay.  Takes care

 

 4             Okay.  So, if I understand correctly, that all of our

 

 5   exhibits are now -

 

 6             THE COURT:  Except the model plan.

 

 7             MR. ROSEN:  - received, except for the 125 and 126.

 

 8        (Creditor's counsel confer briefly off record.)

 

 9             MR. ROSEN:  And, Your Honor, if I may, we have one

 

10   more exhibit.  May I hand up what's been marked as Plaintiff's

 

11   Exhibit 290?  And I will have only a brief word on this exhibit.

 

12             THE COURT:  Do we have the whole exhibit, the whole

 

13   deposition here?

 

14             MR. ROSEN:  No.  No.

 

15             THE COURT:  Well, so if I want to read this in context

 

16   how do I do that?

 

17             MR. ROSEN:  You can't.

 

18             Exhibit 290 and the purpose of offering it is as

 

19   follows.  Yesterday Mr. Zlotoff suggested to the Court that the

 

20   bankruptcy schedules, Exhibit - Schedule B, "A personal

 

21   property," et cetera, that Ms. Lucas had testified Mr. Henson

 

22   was frantically filling out and running to her for information,

 

23   were not necessarily the same one as was filed.  And that there

 

24   was some bankruptcy schedules prepared by Mr. Henson earlier in

 

25   December.  That was the representation by counsel.

 

                                                           517

 

 1             This is the second time in this relatively short trial

 

 2   we have had to deal with a representation by counsel that has no

 

 3   basis in fact and the second time we've had to put in an exhibit

 

 4   to disprove it.

 

 5             This is the witness' testimony.  There were no papers

 

 6   filed in December.  There were no papers prepared in December.

 

 7   And the only thing which he has testified, he prepared in

 

 8   December, is the petition itself, the two pages.  And it bears

 

 9   the date, December 1, which he then put in his pocket after

 

10   Judge Whyte postponed the trial.  And then re- - and then filed

 

11   it in February.

 

12             So this is second time I've had to spend time

 

13   responding to these statements by opposing counsel that have no

 

14   basis in fact.  I would hope that in the remainder of this

 

15   trial, if counsel is going to represent something as a fact,

 

16   that he has some evidence to support it.

 

17             THE COURT:  Do you object to this document?

 

18             MR. ZLOTOFF:  Right.  I object.  It's not complete,

 

19   not a complete transcript.  I - you know, when I wanted to admit

 

20   an exhibit the other day about a transcript that was actually in

 

21   the court file, I got an objection that, well, you have to pay

 

22   50 cents a copy and copy all hundred pages, or whatever, because

 

23   it's not in context, even though it was plainly clear what I was

 

24   trying to admit - admit it for; and the pith of what I wanted

 

25   was in the two pages.  So I'm going to object for the same

 

                                                           518

 

 1   reason.

 

 2             MR. ROSEN:  Counsel mis- - misunderstands the

 

 3   objection.  When he tried to offer a page, I believe it was page

 

 4   52 from the hearing before Your Honor in July of '98, to

 

 5   represent to the Court that Your Honor had made the

 

 6   reinstatement of the bankruptcy petition retroactive.  I said

 

 7   that representation is false.

 

 8             And in fact we have, already marked in our exhibits,

 

 9   the relevant portions of the transcript of that very hearing, in

 

10   which Your Honor said exactly to the contrary.  I didn't object

 

11   on the grounds that he wasn't putting the whole thing in.  I

 

12   objected on the grounds that he was misrepresenting what

 

13   happened at that hearing by offering a one snippet out of

 

14   context.  And I approved it by putting in the portions of that

 

15   transcript which show that that's not what Your Honor said.

 

16             There is no grounds for objection, as was just stated

 

17   and as Your Honor had inquired, that you have to put in the

 

18   whole transcript.  Never has.

 

19             MR. ZLOTOFF:  Well, Your Honor, here's the problem -

 

20             MR. ROSEN:  There's no basis.

 

21             THE COURT:  Let me tell you what I think.

 

22             MR. ROSEN:  I'm sorry.  He interrupted me.

 

23             THE COURT:  I thought you were finished.  Go ahead.

 

24             MR. ROSEN:  I forgot where I was.

 

25             THE COURT:  You said there is no basis.

 

                                                           519

 

 1             MR. ROSEN:  Oh.

 

 2             THE COURT:  It sounded like you were repeating

 

 3   yourself.

 

 4             MR. ROSEN:  There's - there's no basis in the Federal

 

 5   Rules of Evidence.  And if counsel believes there is I would

 

 6   invite him to point us to where in the Federal Rules of Evidence

 

 7   it is even suggested that to offer a part of a deposition you

 

 8   need to offer all of it.

 

 9             And, in fact, let me help counsel out.  Rule 32 says

 

10   we can offer any part of a deposition of a party.  And if you

 

11   think it's out of context, it's your job to offer what's called

 

12   the fairness designations.  It's your job, meaning the debtor,

 

13   not Your Honor of course.  And debtor can certainly offer any

 

14   fairness designations he wants that go with this exhibit.

 

15   That's his prerogative.

 

16             THE COURT:  The problem is that all exhibits were

 

17   supposed to be to me by a certain time.  You may well have a

 

18   reason to want to introduce this late.  But without the whole

 

19   transcript, it's prejudicial.  And so at this point I'm not

 

20   going to introduce it until you have produced the whole

 

21   transcript for everybody to review.  And then he can - he can at

 

22   least have an opportunity to decide, in the middle trial,

 

23   whether or not he wants to introduce other excerpts.  So at this

 

24   point it's excluded.

 

25             MR. ROSEN:  Your Honor, may I just say in view of your

 

                                                           520

 

 1   comments, number one, we didn't delay the offer of this.  This

 

 2   issue came up yesterday.

 

 3             THE COURT:  I - I didn't say you did.  I just said

 

 4   that it otherwise means prejudice if he doesn't have an

 

 5   opportunity to review the whole -

 

 6             MR. ROSEN:  It's not prejudice.  He had the

 

 7   opportunity to get the transcript three years ago.

 

 8             THE COURT:  But maybe he didn't need it three years

 

 9   ago.  And now all of a sudden you're seeking to introduce it.

 

10   And it becomes prejudicial in the -

 

11             MR. ROSEN:  Excuse me, Your Honor, -

 

12             THE COURT:  - middle of trial.

 

13             MR. ROSEN:  Your Honor, you're making arguments for

 

14   Mr. Zlotoff, which he will not make himself.  Don't -

 

15             THE COURT:  I'm not making an argument for anybody.

 

16             MR. ROSEN:  You are.

 

17             THE COURT:  He objected because it's not the whole

 

18   transcript.

 

19             MR. ROSEN:  And, Your Honor, you just offer, as an

 

20   excuse for Mr. Zlotoff, that maybe he didn't need the whole

 

21   transcript three years ago.

 

22             THE COURT:  I don't know whether he did or didn't -

 

23             MR. ROSEN:  Well, I'm telling you that -

 

24             THE COURT:  - Mr. Rosen.  You try to take me on as if

 

25   - as if I'm your colleague.

 

                                                           521

 

 1             MR. ROSEN:  What -

 

 2             THE COURT:  I'm not.

 

 3             MR. ROSEN:  Your Honor, -

 

 4             THE COURT:  And I'm telling you I've ruled.  And I'd

 

 5   like you to be quiet.

 

 6             MR. ROSEN:  Your Honor, I'd like to make a record,

 

 7   just if I may have the privilege of speaking for 30 seconds on

 

 8   this.  You just offered as an additional ground that perhaps Mr.

 

 9   Zlotoff is prejudiced because he didn't know he had to get it to

 

10   before now.  Our trial exhibits, which he's had a long time

 

11   include excerpts from this very same deposition.  There is no

 

12   basis for Your Honor suggesting - and indeed Mr. Zlotoff is not

 

13   claiming - that his need to get this transcript arose just now.

 

14   That's number one.

 

15             Number two - and it's my last comment - I find it

 

16   extremely disheartening that Your Honor would say to me this is

 

17   being offered late.  Mr. Zlotoff yesterday has offered documents

 

18   which he didn't comply with, he had before.  He didn't comply

 

19   with your order.  And that's okay.

 

20             THE COURT:  No.  The standard is prejudice.

 

21             MR. ROSEN:  No.  The standard is good cause, Your

 

22   Honor, for not complying.

 

23             THE COURT:  Yes, that is good cause -

 

24             MR. ROSEN:  That's not prejudice.

 

25             THE COURT:  - and prejudice.  Anyway, if there's - if

 

                                                           522

 

 1   there's no prejudice then there's a different - well, anyway.

 

 2   Here there is possible prejudice.  And all you have to do is let

 

 3   him see the transcript.

 

 4             MR. ROSEN:  Your Honor already ruled on a motion he

 

 5   made before trial.  He asked that we'd be required to produce

 

 6   the transcripts to him.  We said no.  Your Honor ruled in our

 

 7   favor.

 

 8             We have a transcript that says - in which you said to

 

 9   Mr. Zlotoff he doesn't have any obligation to produce them to

 

10   you.

 

11             THE COURT:  I understand, but that's not in the middle

 

12   of trial.

 

13             MR. ROSEN:  Well, I don't understand the difference.

 

14             THE COURT:  It's a new - it's a new excerpt that

 

15   you're seeking to introduce in the middle trial.

 

16             MR. ROSEN:  Okay.  Well, Your Honor, now that we know

 

17   that new excerpts cannot be offered during trial, -

 

18             THE COURT:  I didn't say that.

 

19             MR. ROSEN:  Yeah.

 

20             THE COURT:  They can.  All you have to do is let him

 

21   read the -

 

22             MR. ROSEN:  Excuse me.

 

23             THE COURT:  - transcript.

 

24             MR. ROSEN:  Now that we know -

 

25             THE COURT:  You can do it during the break.

 

                                                           523

 

 1             MR. ROSEN:  - I can't offer it without doing something

 

 2   that I have no obligation to do, does Your Honor have any

 

 3   authority, I would beg the Court to give me so I can argue

 

 4   against it, for the proposition I have to show him a transcript

 

 5   in order to introduce this?

 

 6             THE COURT:  Or I would -

 

 7             MR. ROSEN:  I would love to have -

 

 8             THE COURT:  - adjourn the trial for him to go read the

 

 9   transcript.  I'm going to avoid prejudice.

 

10             MR. ROSEN:  He doesn't have the transcript.

 

11             MR. ZLOTOFF:  Your Honor, I'm going to withdraw it.

 

12   It's not worth the argument to me.

 

13             THE COURT:  I see.  All right.

 

14             MR. ZLOTOFF:  I'm sorry - I'm sorry for the problem.

 

15   He just - he set me off and I probably shouldn't have objected

 

16   in the first place, because it's - it's not that meaningful.

 

17             MR. ROSEN:  But - and that -

 

18             MR. ZLOTOFF:  Because it doesn't go to anything that

 

19   he said, in the first place, because it - nothing here rebuts

 

20   the fact that Mr. Henson could have had a worksheet, a separate

 

21   worksheet, that Ms. Lucas testified she saw him waving around.

 

22   Nothing -

 

23             THE COURT:  290 is admitted.

 

24             MR. ZLOTOFF:  - in here is contrary to that.

 

25        (Creditor's Exhibit 290 received in evidence.)

 

                                                           524

 

 1             MR. ROSEN:  Your Honor, there is now, as long as

 

 2   you're on the subject of late-offered exhibits, I was handed two

 

 3   exhibits by Mr. - by Mr. Zlotoff yesterday.  So perhaps - and

 

 4   they are - he marked them Exhibits R and S.  I assume he wants

 

 5   to for them, so let him do so I would suppose at this time

 

 6   before we put Ms. Lucas back on the stand.

 

 7             And, by the way, my opening objection is these were

 

 8   never produced earlier.  And the prejudice is there's no good

 

 9   cause.  There is no such thing as prejudice.  The burden is on

 

10   the party who is moving the exhibits in in violation of an order

 

11   to show good cause why he didn't comply.  I don't ever have to

 

12   show prejudice until he satisfies the burden of good cause.

 

13   That's the law in the Ninth Circuit and it's the law in every

 

14   court in this country.

 

15             THE COURT:  I don't have R and S.

 

16             MR. ZLOTOFF:  All right.

 

17             THE COURT:  And so you don't have to - in any event,

 

18   you don't have to introduce R and S now because he tells you to.

 

19   You have - you decide -

 

20             MR. ZLOTOFF:  Well, -

 

21             THE COURT:  - when you want to introduce R and S.

 

22             MR. ZLOTOFF:  If it's appropriate we could do it now.

 

23   It doesn't matter to me.  Or, in fact, I'm -

 

24             THE COURT:  Wait a second.  I haven't - I didn't even

 

25   know I had it.

 

                                                           525

 

 1             MR. ZLOTOFF:  Okay.

 

 2             THE COURT:  This is a complaint by RTC against Mr.

 

 3   Henson?

 

 4             MR. ZLOTOFF:  It's a certified complaint, and I just

 

 5   request that the Court take judicial notice of it.

 

 6             THE COURT:  And what's the S?

 

 7             MR. ZLOTOFF:  S?

 

 8             THE COURT:  S.

 

 9             MR. ZLOTOFF:  Oh, Exhibit S.  Oh, that's the notice of

 

10   amendment to motion to sell that was filed 9-25-02, and I asked

 

11   the Court to take judicial notice of that.

 

12             THE COURT:  Is there -

 

13             MR. ZLOTOFF:  It's simply a one-sentence statement

 

14   that - do you want me to read it, Your Honor?

 

15             THE COURT:  I understand what the notice is.  It says,

 

16   "Debtor hereby amends the prayer of his motion to sell free and

 

17   clear to provide that his plan shall be paid off from the

 

18   proceeds of such sale."  I understand what it is.

 

19             Why are we getting this at this time?

 

20             MR. ZLOTOFF:  Just housekeeping, Your Honor.  There's

 

21   no - no special reason why now - oh, why as opposed to why not -

 

22             THE COURT:  Well, this is after -

 

23             MR. ZLOTOFF:  - a month - a month ago.

 

24             THE COURT:  I mean this is dated a few days ago.

 

25             MR. ZLOTOFF:  That's right.

 

                                                           526

 

 1             THE COURT:  Okay.  So -

 

 2             MR. ZLOTOFF:  So I couldn't possibly have put it in my

 

 3   trial binder because it's a new document.

 

 4             THE COURT:  And what about this other thing?  This -

 

 5   why is this being offered, this verified complaint?

 

 6             MR. ZLOTOFF:  The verified complaint goes to - to the

 

 7   issue that Your Honor brought up, I thought, with regard to

 

 8   Eisen, for - with regard to the reason for filing the Chapter

 

 9   13.  There was -

 

10             THE COURT:  What does it say that's relevant, in your

 

11   view?

 

12             MR. ZLOTOFF:  That there wasn't a prayer for damages.

 

13   I think at some point during the trial Your Honor asked whether

 

14   Mr. Henson was aware of - that there were - there was a

 

15   potential for a large damage award against him.  And Mr. Rosen

 

16   said, 'Well, you know, statutory.  Could be 50 cents,' or

 

17   whatever he said, which he could have paid out of his own

 

18   pocket.  Well, it's not true.  If you read this, you can see

 

19   that the damage request is for I think a hundred thousand

 

20   dollars per bad act or something like that.

 

21             So he was put on notice, if you look at the prayer.

 

22   For example, the prayer on the second claim for relief on page

 

23   10 for an award of statutory - statutory damages of a hundred

 

24   thousand dollars for each of the works infringed, so - and

 

25   there's a request further down as well for attorneys' fees.  So

 

                                                           527

 

 1   I think that it's relevant for that purpose, Your Honor.

 

 2             MR. ROSEN:  I have three objections.  I'll start with

 

 3   the complaint.

 

 4             The complaint is dated April 4th, 1996.  I haven't

 

 5   heard anything that even approaches good cause for noncompliance

 

 6   with Your Honor's order.  I assume that you're going to ask me

 

 7   what the prejudice is.  And my prejudice is I comply with Court

 

 8   orders, Mr. Zlotoff doesn't.  That's prejudice, in addition to

 

 9   everything else I've said yesterday -

 

10             THE COURT:  How about on the merits?

 

11             MR. ROSEN:  On the merits, of course it's -

 

12             THE COURT:  What's the prejudice?

 

13             MR. ROSEN:  Of course it's prejudicial on the merits.

 

14   This is being - the critical issue here is as follows.  And it's

 

15   the same - and there are two cases that we talk about in our

 

16   brief.

 

17             At the point in time when the debtor filed the

 

18   petition in February of 1998 what was he facing.  Was there a

 

19   reason, a legitimate reason that he conceived that he's facing a

 

20   claim that he was going to be unable to pay.  To the extent -

 

21   and I think that that probably is of course the standard.

 

22   That's what I argued in my opening argument.

 

23             The fact that a complaint demands the maximum in a

 

24   statutory range of 500 to a hundred thousand dollars does not

 

25   mean that the creditor believed - that it could reasonably

 

                                                           528

 

 1   believe that he was exposed for a hundred thousand dollars when

 

 2   the creditor is - is fiercely contesting the fact that he, A,

 

 3   infringed; B, that the infringement was willful.  So you can't

 

 4   just take and damages from a complaint.

 

 5             But let me tell you the part that really offends me

 

 6   about this.  This is being offered to you as the pleading I

 

 7   presume which is before - which the debtor is faced with in

 

 8   February of 1998, about 22 months after this action was filed,

 

 9   and which caused him to file the bankruptcy petition.  If that

 

10   is the proposition that Mr. Zlotoff is presenting to you, it is

 

11   a fraud on the Court.

 

12             This is the first complaint in the case.  Long before

 

13   February of 1998, we withdrew portions of this pleading.  When

 

14   the Judge - when Judge Whyte granted us permanent injunction in

 

15   June of 1997 on a copyright claim, at or about that same time we

 

16   withdrew portions of this, including, by the way, if I remember

 

17   correctly, and we do have a record, the entirety of claim 3.

 

18             And for counsel to stand here and offer you this and

 

19   say this is what the debtor was faced with in February of 1998 -

 

20   because what he was faced with in '96 is meaningless.  He didn't

 

21   file a bankruptcy petition in '96.  What we was faced with in

 

22   '97 is meaningless.

 

23             If there is anything that's relevant it's what he was

 

24   faced with in February of 1998.  And for counsel to offer this

 

25   knowing that it is - it is false, knowing that the - that

 

                                                           529

 

 1   portions of this complaint were withdrawn, and including the

 

 2   entirety of - of the third claim for relief constitutes a fraud

 

 3   on the Court.

 

 4             MR. ZLOTOFF:  Your Honor, I don't know anything.  All

 

 5   I know is I went upstairs - or downstairs to the District Court

 

 6   Clerk's Office and I said, 'Gee, what I can figure out from this

 

 7   file with regard to what kind of action in the District Court

 

 8   Mr. Henson had knowledge of or constructive knowledge of,' and

 

 9   this is what I pulled out, the first document of the file.

 

10             MR. ROSEN:  And may I respond to that as follows.

 

11   Counsel as an attorney is charged with the knowledge of what is

 

12   in the District Court file.  He went to the District Court

 

13   Clerk's Office, he pulled out this document.  If he had bothered

 

14   to read the Docket he would have seen the withdrawal, for

 

15   example, of the third claim for relief.

 

16             Counsel cannot say, 'Gee, I didn't do my job.  I saw

 

17   June of '96' - 'April of '96, and I didn't go further.'  He's

 

18   charged with knowledge of what's in that Docket.  He went to the

 

19   Clerk to get it, and he should have looked at it, and I don't

 

20   know whether he did or not.  But he's certainly responsible for

 

21   doing so, because he's made a representation to this Court that

 

22   it's false.

 

23             THE COURT:  What about S -

 

24             MR. ROSEN:  I don't have any objection to this

 

25   document because it is in the Court's - it's a public record in

 

                                                           530

 

 1   the - in the Clerk of the District Court's file -

 

 2             THE COURT:  Wait.  S we're talking about.

 

 3             MR. ROSEN:  R.

 

 4             THE COURT:  R, you have no objection?

 

 5             MR. ROSEN:  No, you interrupted me.  I have no

 

 6   objection to Your Honor seeing this document per se.  What I

 

 7   object to, as I said, is the lateness of it.  It wasn't on the

 

 8   list, number one.

 

 9             If Your Honor believes it's relevant, then Mr. Zlotoff

 

10   should be directed to produce the rest of the Docket showing the

 

11   withdrawal of claim 3.

 

12             THE COURT:  Or just the amended complaint.  Was there

 

13   an amended complaint -

 

14             MR. ROSEN:  No.  There's not an amended complaint

 

15   because when you withdraw a cause of action you don't have to

 

16   file an amended complaint.  You file a notice of withdrawal of

 

17   the Court's -

 

18             THE COURT:  That's all you did, is to file a

 

19   withdrawal -

 

20             MR. ROSEN:  Isn't that right, hm?

 

21        (Creditor's counsel confer briefly off record.)

 

22             THE COURT:  There was no amended complaint?

 

23             MR. ROSEN:  Of course not.

 

24             THE COURT:  Well, I don't know what you did.  It's not

 

25   "Of course not."  Sometimes you do more than just withdraw.  You

 

                                                           531

 

 1   do something else.  So now here I'm asking you was there an

 

 2   amended complaint?

 

 3             MR. ROSEN:  No.

 

 4             THE COURT:  Thank you.

 

 5             MR. ROSEN:  There was a notice of withdrawal of the

 

 6   third claim for relief.

 

 7             THE COURT:  That's fine.

 

 8             MR. ROSEN:  That's on the Docket.

 

 9             With respect to Exhibit S, this is being put in,

 

10   according to Mr. Zlotoff, to show something, I have no idea what

 

11   it is.  This purports to be a notice of amendment to a motion

 

12   that had already been set on the 10th of September for the 10th

 

13   of October, that we filed our opposing papers.  We - we asked

 

14   for it, and Your Honor gave us a total of nine days to respond,

 

15   despite the fact that the Bankruptcy Rules, the Local Bankruptcy

 

16   Rules require 28-days notice for a motion to sell free and

 

17   clear.

 

18             THE COURT:  Why are we - why are you arguing that now?

 

19             MR. ROSEN:  I don't want - because I want to go a step

 

20   further.

 

21             I don't have any idea what Mr. Zlotoff used as the

 

22   relevance of this motion.  I view it as relevant for one reason.

 

23   This is a continuation of - I don't want to say bad faith on the

 

24   part of Mr. Zlotoff.  There is no such as a notice of amendment

 

25   to a motion.  It is unknown in federal practice.  It is not in

 

                                                           532

 

 1   the Federal Rules, it's not in the Bankruptcy Rules.

 

 2             You want to amend a motion, you withdraw the motion

 

 3   and you file a new one.  You start over again.  You cannot just

 

 4   with - with the - the aid of a pencil and a piece of paper

 

 5   create a document called "notice of amendment to motion."

 

 6             THE COURT:  The legal sufficiency of the notice is not

 

 7   before me.

 

 8             MR. ROSEN:  No.  I'm saying if Mr. Zlotoff -

 

 9             THE COURT:  Then why are you going through this?  I

 

10   don't understand -

 

11             MR. ROSEN:  I'll say - I'll say it again.

 

12             THE COURT:  - why you're - why you're - you're - why

 

13   are you objecting to the admission of the document, because the

 

14   document is legally deficient?

 

15             MR. ROSEN:  No.  To the contrary, I just said to you,

 

16   I don't know why Mr. Zlotoff is offering it, but if you admit it

 

17   into evidence it's okay with me because I will argue from it, -

 

18             THE COURT:  Okay.  That's fine.

 

19             MR. ROSEN:  - as I just have, -

 

20             THE COURT:  Then that's it.

 

21             MR. ROSEN:  - that it is improper.

 

22             THE COURT:  Then the answer is no objection.

 

23             MR. ROSEN:  Other than the fact that it wasn't timely

 

24   produced, which I said earlier -

 

25             THE COURT:  Well, it couldn't have been timely

 

                                                           533

 

 1   produced.  It occurred the month after the deadline, right?

 

 2             MR. ROSEN:  It's dated September 24th.  It could have

 

 3   been presented to us before this trial started.

 

 4             THE COURT:  Oh, I see.  Okay.  That's fine.

 

 5             The - was RTC served with this document?

 

 6             MR. ZLOTOFF:  Which one, Your Honor?

 

 7             THE COURT:  With 20 - with S.

 

 8             MR. ZLOTOFF:  Yes.

 

 9             THE COURT:  Okay.

 

10             MR. ZLOTOFF:  Yes.

 

11             THE COURT:  And after that long lecture, I - or

 

12   whatever it was by Mr. Rosen, I understand that he doesn't

 

13   object to the introduction of R on the merits other than he

 

14   wants you to correct it, and I think that's correct.  So that to

 

15   the extent you want to accept - if he'll make an offer of proof

 

16   that this was amended, in essence, by withdrawal of the third

 

17   claim for relief and that's the only way in which it was

 

18   changed, and you want to accept that, then there's no reason to

 

19   go to the District Court.  If you want to go to the District

 

20   Court and check it, you can check it.  But otherwise I would -

 

21   if you won't accept what he's saying, then I would order you to

 

22   go to the District Court.

 

23             MR. ZLOTOFF:  No.  You know, I spent about an hour

 

24   looking at the Docket, and I don't remember seeing a withdrawal.

 

25   I remember seeing an order, I think by Judge Whyte, denying a

 

                                                           534

 

 1   claim for trade secrets, or something like that.  But I didn't

 

 2   read from the third cause of action, which was the trade

 

 3   secrets.

 

 4             THE COURT:  Did -

 

 5             MR. ZLOTOFF:  It was the - it was the second cause of

 

 6   action for copyright infringement.  So, yeah, I accept what he

 

 7   says, and - but I still don't understand why -

 

 8             THE COURT:  Do we have the Docket here, Tanya?

 

 9             THE CLERK:  For District Court?

 

10             THE COURT:  Do we have anything that shows regarding

 

11   claim 3?

 

12        (The Court and Clerk confer off record.)

 

13             THE COURT:  Okay.  Fine.  You make an offer of proof

 

14   that you withdrew claim 3 or that it was denied?

 

15             MR. ROSEN:  Not an offer of proof.  I made a

 

16   representation.

 

17             THE COURT:  Right.  Okay.  That's fine.

 

18             Then you withdrew it voluntarily?

 

19             MR. ROSEN:  Yes, I'm told -

 

20             THE COURT:  Thank you.  That's fine.

 

21             MR. ROSEN:  I wasn't there.  My - that's why, I'm not

 

22   being impolite.  I had to lean over and ask Ms. Kobrin.  I

 

23   wasn't at the - involved in the case at that time.

 

24             THE COURT:  That's fine.  R is admitted.

 

25        (Debtor's Exhibit R received in evidence.)

 

                                                           535

 

 1             MR. ZLOTOFF:  Shall I go through one other

 

 2   housekeeping matter or -

 

 3             THE COURT:  Sure.

 

 4             MR. ZLOTOFF:  There was -

 

 5             THE COURT:  What do you need, Tanya?

 

 6             THE CLERK:  I just wondered about S.

 

 7             THE COURT:  S is admitted.

 

 8             THE CLERK:  Okay.

 

 9        (Debtor's Exhibit S received in evidence.)

 

10             MR. ZLOTOFF:  Wells Fargo statements.  That was O.

 

11   And I think that is hanging on a thread.  I was supposed to

 

12   represent that those were true copies of the subpoena that I

 

13   got, and they are.  And so I think they have actually been

 

14   referred to by Mr. - by Mr. Rosen as cross-examination of Ms.

 

15   Lucas.  So I would move for their admission as well.

 

16             THE COURT:  Any opposition now?

 

17             MR. ROSEN:  Yeah, but I think you already ruled on it.

 

18   You overruled my opposition.  You allowed it in.

 

19             MR. ZLOTOFF:  Oh, okay.

 

20             THE COURT:  What does it show, Tanya?  O.

 

21             THE CLERK:  Objection overruled subject to

 

22   certification.

 

23             MR. ROSEN:  You overruled my objection.  You told Mr.

 

24   Zlotoff he had to get certification for the subpoena.

 

25             THE COURT:  Okay.  It's admitted now.

 

                                                           536

 

 1        (Debtor's Exhibit O received in evidence.)

 

 2             THE COURT:  Are we ready for Ms. Lucas?

 

 3             MR. ROSEN:  Yes, I am.

 

 4             THE CLERK:  I still show P and Q out there.  P and Q,

 

 5   Exhibits P and Q -

 

 6             MR. ZLOTOFF:  P and Q?  Both - Q Mr. Rosen objected

 

 7   to.  That was the transcript that we had talked about.

 

 8             THE CLERK:  It was a copy of the Court's calendar.

 

 9             THE COURT:  Yeah, Q -

 

10             THE CLERK:  Oh.  Q.  Excuse me.

 

11             MR. ZLOTOFF:  That was Q -

 

12             THE COURT:  P.  I'll take P if it's my calendar.  It's

 

13   not a problem.  I don't see why that would be a problem.  But -

 

14   so P, if you want it, can come in.

 

15             MR. ZLOTOFF:  Yes, I do.

 

16             THE COURT:  Okay.  P is in.  It's the Court's

 

17   calendar.

 

18        (Debtor's Exhibit P received in evidence.)

 

19             THE COURT:  And what about Q?

 

20             MR. ZLOTOFF:  That was the - a part of the Court

 

21   transcript of a proceeding that Mr. Rosen said was out of

 

22   context and so inaccurate.  And so we objected to it.

 

23             THE COURT:  Okay.  So do we have the whole transcript?

 

24             MR. ZLOTOFF:  The whole transcript is in - is in a

 

25   court file.  That's where I copied it from, from a court file.

 

                                                           537

 

 1   So I don't know why the Court can't take judicial notice of it,

 

 2   but -

 

 3             THE COURT:  I could take judicial notice of the

 

 4   transcript before me - in my file.  And if you're agreeable that

 

 5   the whole transcript comes in or that you want to do counter

 

 6   excerpts, what do you want to do?

 

 7             MR. ROSEN:  We've already offered the portions of that

 

 8   very transcript.  They're in our books.

 

 9             THE COURT:  So is there any problem with admitting

 

10   this portion as well?

 

11             MR. ROSEN:  Yes, of course.

 

12             THE COURT:  And what is that, because it's late?  What

 

13   is the reason?

 

14             MR. ROSEN:  Yeah.  Because it's not in compliance with

 

15   your order, of a transcript of a hearing that goes back four

 

16   years, number one.  And, number two, because the portion of the

 

17   transcript which is offered is deceptive.

 

18             THE COURT:  But your excerpts clear up the deception,

 

19   you say?

 

20             MR. ROSEN:  Yes.

 

21             THE COURT:  Okay.  I'll take Q.

 

22        (Debtor's Exhibit Q received in evidence.)

 

23             THE CLERK:  I show E still out there too.

 

24             MR. ZLOTOFF:  No, no, no.  That was out.

 

25             THE CLERK:  Out?  Okay.  Thank you.

 

                                                           538

 

 1             MR. ZLOTOFF:  That was in limine excluded.

 

 2             THE CLERK:  Okay.

 

 3             THE COURT:  Okay.  Yeah.  Why don't we see if Ms.

 

 4   Lucas is available.

 

 5             Go off the record, please.

 

 6        (Off the record at 10:57 a.m.)

 

 7             THE COURT:  Yeah.  In ruling on any of these exhibits

 

 8   that RTC claimed were relevant and Mr. Zlotoff on behalf of the

 

 9   debtor claimed that he didn't think they were relevant, I'm not

 

10   limited to whether something bears on a debt or assets.

 

11   Obviously I'm not determining any free speech issues and I'm

 

12   determining anybody is a good or a bad person, character flaw.

 

13             It has to do with relationship between two parties,

 

14   and that is the debtor and the RTC.

 

15             MR. ZLOTOFF:  I understand.  I appreciate all the work

 

16   you put into that, Your Honor.  Thank you.

 

17             THE COURT:  Ms. Lucas, are you ready to step forward

 

18   and testify?  But you need to be at a microphone?

 

19             MS. LUCAS:  I have been trying to reach attorneys,

 

20   Your Honor.  My attorney, who had appeared before in this case,

 

21   is not available.  And he referred me to another attorney in

 

22   Palo Alto and I was just waiting for a call back from him.

 

23             I feel as if I've gotten in over my head and I would

 

24   prefer not to testify further if there is any way that can be

 

25   postponed until my attorney can help me.

 

                                                           539

 

 1             THE COURT:  Yeah.  But we need to know when, Ms.

 

 2   Lucas.

 

 3             MS. LUCAS:  Yes.  If - if I can find out him from him

 

 4   when he is available, then I - I can tell you.

 

 5             THE COURT:  What have you done?  Have you called -

 

 6             MS. LUCAS:  I called several attorneys.

 

 7             THE COURT:  No, I know.  But -

 

 8             MS. LUCAS:  Yes.

 

 9             THE COURT:  - you say you're waiting for somebody in

 

10   Palo Alto?

 

11             MS. LUCAS:  Yes.  I -

 

12             THE COURT:  Or - but what -

 

13             MS. LUCAS:  I reached somebody about 15 minutes ago

 

14   who is supposed to call me right back, but he was on the phone,

 

15   and I don't know what his situation is.

 

16             THE COURT:  I'll give you permission to leave your

 

17   cell phone on and then we're going to go forward.  Mr. Rosen has

 

18   agreed to try not to deal with anything dealing with joint

 

19   tenancy, that issue, and then I'll break again if I need to.

 

20             But you can leave your cell phone on if you've given

 

21   him your cell phone to call you back.

 

22             MS. LUCAS:  Thank you.

 

23             THE COURT:  I remind you that you're under oath.

 

24             Could you say that on the record?

 

25   VICTORIA AREL LUCAS, DEBTOR'S WITNESS, PREVIOUSLY SWORN

 

                                                           540

 

 1             THE WITNESS:  Yes, Your Honor.

 

 2             THE COURT:  Mr. Rosen, your witness.

 

 3             MR. ROSEN:  Thank you, Your Honor.

 

 4                  CROSS-EXAMINATION, resumed

 

 5   BY MR. ROSEN:

 

 6   Q.  Ms. Lucas, yesterday we were talking about your check book

 

 7   register.  And I was about to ask you a question.  I think we

 

 8   got sidetracked, so let me come back to it.

 

 9             If you wanted to know how much money you had in an

 

10   account as of any given time, like today, you could open your

 

11   checkbook register and see how much is available, meaning that

 

12   there may be checks that you've written which albeit not yet

 

13   been presented, but you could open your checkbook register and

 

14   tell us that, couldn't you?

 

15   A.  Not really.

 

16   Q.  Why not?

 

17   A.  Because I don't always write everything down and because I

 

18   have different accounts.  And my - the joint account I have with

 

19   my husband, he has expenses that he tells me about or that he

 

20   emails me about.  And I don't always know at the moment what the

 

21   commitments are.

 

22   Q.  Ms. Lucas, didn't you testify yesterday afternoon that you

 

23   could open the checkbook, and assuming the math was correct, you

 

24   could tell us what the balance was in the household account, the

 

25   Wells Fargo account?  Didn't you say that yesterday?

 

                                                           541

 

 1   A.  I may have.  That assumed that the math was correct.

 

 2   Q.  Right, okay.  So now tell me something, Ms. Lucas.  As I

 

 3   read Exhibit A, the third page, Schedule B - and you can

 

 4   certainly open to it, ma'am.  The page that's headed "Schedule

 

 5   B, Personal Property."  This account is identified with a

 

 6   balance of $1500.

 

 7   A.  It's exhibit - excuse me.  It's Exhibit A?

 

 8   Q.  Exhibit A, third page of the exhibit.

 

 9   A.  And what was the question?

 

10   Q.  The - the account you've identified is the household account

 

11   at Wells Fargo.

 

12   A.  Yes.

 

13   Q.  It's shown on here as having a balance of precisely $1500.

 

14   A.  Yes.

 

15   Q.  Now we know from your testimony yesterday, even though your

 

16   husband described it as, quote, savings and checking accounts,

 

17   that the savings account balance at that time in March of 1998

 

18   was zero, right?

 

19   A.  That's what I recollect.

 

20   Q.  So are you - is it your recollection, as you sit here today,

 

21   that the balance in your checking account at Wells Fargo on

 

22   March 10th of 1998 was $1500?

 

23   A.  I'm not sure.  It looks right, but without actually looking

 

24   at any records I can't be sure.

 

25   Q.  But if you wanted to, to make sure it was right, ma'am, you

 

                                                           542

 

 1   could have before taking the witness stand in this case, and

 

 2   after conferring with Mr. Zlotoff, you could have gone back to

 

 3   your checkbooks and found a checkbook that covered this period

 

 4   of time, couldn't you?

 

 5   A.  I -

 

 6   Q.  And then you wouldn't have to guess, right?

 

 7   A.  I don't know where - whether my current - my current

 

 8   checkbook doesn't cover this period.  And I don't know whether

 

 9   that checkbook is in Canada or where it physically is.

 

10   Q.  So, in other words, if you don't have it, it's because you

 

11   shipped it to Canada when?

 

12   A.  Possibly a couple of weeks ago or I might have left it with

 

13   my husband earlier.

 

14   Q.  You left your 1998 checkbook up in Canada with your husband?

 

15   A.  It's possible.  I'm not sure.

 

16   Q.  Ms. Lucas, please, this is a court of law.  Anything is

 

17   possible, okay?  And to use the example from the textbook, it's

 

18   possible that a dog ate the exhibit.  But we only deal in

 

19   probability, so if I might ask you, ma'am, is it likely, do you

 

20   believe it is more likely than not, meaning 51 percent

 

21   certainty, that you took this document out of the United States

 

22   and gave it to your husband in Canada?

 

23   A.  All I can tell you is that I think it is unlikely that I

 

24   have it in my possession at the moment.

 

25   Q.  Yeah, I know.  My question is when did you last have it in

 

                                                           543

 

 1   your possession, ma'am?

 

 2   A.  I don't know.

 

 3   Q.  All right.  Now let me see if I understand something.  Apart

 

 4   from the separate accounts that you have, your testimony

 

 5   yesterday was that your husband maintained no separate bank

 

 6   accounts of any kind, not savings or checking, right?

 

 7   A.  That's correct.

 

 8   Q.  And again we're in this period of 1998.  Unless I say

 

 9   differently, please understand my questions relate to this

 

10   period of time.

 

11             Well, if I'm understanding you correctly, ma'am, then

 

12   putting aside whatever money you had in your separate account,

 

13   the grand total of the amount of cash you and your husband had,

 

14   total cash you and your husband had on March 10th, 1998 is

 

15   $1500, right?

 

16   A.  It seems correct.

 

17   Q.  Okay.  All right.  Now you testified that you opened all of

 

18   the correspondence, including the credit card bills and the like

 

19   and invoices that came to your husband, that were addressed to

 

20   him, right?

 

21   A.  During that period of time.

 

22   Q.  What was - what credit cards did your husband have as of

 

23   March of 1998?

 

24   A.  I think he may have had an American Express, but I'm not

 

25   sure.  At some point, I - I think it was an American Express.

 

                                                           544

 

 1   There was a - I believe there was a card from Wells Fargo.

 

 2             There was a card which at that time may have been

 

 3   called a More Card.  I think the company that owned it has been

 

 4   bought and sold several times since then.

 

 5             THE COURT:  I didn't understand the word.

 

 6             MR. ROSEN:  M-o-r-e.

 

 7             THE WITNESS:  More.  It was called - at that time it

 

 8   was called M-o-r-e, More Card.

 

 9   BY MR. ROSEN:

 

10   Q.  Now these are all credit cards you're -

 

11   A.  Yes.

 

12   Q.  - talking about, right?

 

13   A.  Yes.

 

14   Q.  Because when you said a Wells Fargo card, you're not talking

 

15   about a card that allows you to access an ATM.  You're talking

 

16   about a card that you can give to a merchant and charge a

 

17   purchase and then you have to pay the bank?

 

18   A.  Yes.

 

19   Q.  Like a Visa or MasterCard, right?

 

20   A.  Yes.

 

21   Q.  Okay.  So we got three cards so far.  More, Wells Fargo, and

 

22   American Express, right?

 

23   A.  Yes.

 

24   Q.  Is the American Express a green, was it a green or gold?

 

25   A.  Green.

 

                                                           545

 

 1   Q.  Green.  Any other credit cards your husband had at that

 

 2   time?

 

 3   A.  He may have had some gasoline credit cards.  I think he was

 

 4   listed on my - what used to be called Beacon, Ultamar Diamond,

 

 5   whatever they are these days -

 

 6   Q.  Ma'am, I'm only - I've only asked you for the credit cards

 

 7   that your husband had -

 

 8   A.  Not joint.

 

 9   Q.  I'm not interested in joint credit cards.

 

10   A.  Okay. 

 

11   Q.  I'll ask you that separately.  The only - these are only

 

12   credit cards that are in your husband's name, not yours.

 

13   They're not joint cards.  So of any others that he had?

 

14             THE COURT:  Was that clear to you?  Are these other

 

15   cards solely his?

 

16             THE WITNESS:  Yes.  Thank you, Your Honor.

 

17             I don't remember if he had gasoline cards.  I don't

 

18   think of anything else.

 

19   BY MR. ROSEN:

 

20   Q.  Okay.

 

21   A.  Oh, he had a Sears card I think.

 

22   Q.  Okay.  So we have - let me see if I've got this right now.

 

23   At this time in February, March of 1998 your husband had

 

24   separately not a joint card, a credit - the following credit

 

25   cards:  Sears, More, Wells Fargo, American Express green, and

 

                                                           546

 

 1   possibly a gasoline credit card, like a Mobil or an Exxon card?

 

 2   A.  Well, - well, wait.  Now the Wells card was joint, so that -

 

 3   you said -

 

 4   Q.  Okay.

 

 5   A.  - you would ask me that separately.

 

 6   Q.  Okay.  So we have four:  Sears, More, American Express

 

 7   green, and possibly a gas - gasoline company credit card, like a

 

 8   Mobil card or a Gulf card or something?

 

 9   A.  Maybe - I know at one point he had a Shell -

 

10   Q.  Oh, that's fine.  I don't care what gas company it was.

 

11   A.  I think -

 

12   Q.  I'll accept Shell.

 

13   A.  I think he may have had a card with Montgomery Ward.

 

14   Q.  Okay.  That's another one, Montgomery Ward.

 

15             Okay.  If that taxes your recollection, that's fine.

 

16   If as we go through this you remember any other cards that your

 

17   husband had alone, not joint cards, you let me know and we can

 

18   ad did it.

 

19             Okay.  Let's start with the Montgomery Ward credit

 

20   card.  What was the balance owed on that credit card by your

 

21   husband in February of 1998?

 

22   A.  I don't know.

 

23   Q.  What was the balance in March of 1998?

 

24   A.  I don't know.  The best I could do is an estimate.

 

25   Q.  Well, when you say estimate are you just guessing and

 

                                                           547

 

 1   plucking a number out of the air or do you have a basis to

 

 2   believe that it is more likely or not to be correct?

 

 3   A.  I know that for a number of years, but I don't know if it

 

 4   was during this period, our balances ran about a hundred

 

 5   dollars.

 

 6   Q.  But you don't know what your balance - the balance on your

 

 7   husband's Montgomery Ward card was in February or March of '98,

 

 8   right?

 

 9   A.  That's correct.

 

10   Q.  What was the balance due on your husband's More credit card

 

11   in February of 1998?

 

12   A.  I don't know.

 

13   Q.  How about his American Express card?

 

14   A.  He had to pay that off every month.  So any balance that he

 

15   might have had would have just been until the next bill was

 

16   paid, so I - I don't know.

 

17   Q.  So, in other words, he paid all the American Express cards

 

18   bills - bills on time?

 

19   A.  He had to.  With the - that was the terms.  Of the terms of

 

20   the green card are that you have to pay them, -

 

21   Q.  No.  I - I -

 

22   A.  - they're due when paid.  They are due -

 

23   Q.  I understand.  And that's American Express' stated terms.

 

24   I'm asking you whether your husband complied with those stated

 

25   terms?

 

                                                           548

 

 1   A.  If he could.

 

 2   Q.  Okay.  Now - now let's talk about joint cards.  And you

 

 3   mentioned one card that is a joint account, meaning that one

 

 4   bill comes to the house for charges placed on the card either by

 

 5   you or your husband, right?

 

 6   A.  Yes.

 

 7   Q.  And that's a Wells Fargo card.  What other credit cards were

 

 8   there that were joint in the sense of both you and your husband

 

 9   had access to them?

 

10             Again, remember my period of time we're focusing on,

 

11   ma'am, is March - February, March of 1998.

 

12             THE COURT:  Are you including gas cards?

 

13             MR. ROSEN:  If there is one, sure.

 

14             THE WITNESS:  The only one I remember is the gas card,

 

15   the Ultramar.

 

16   BY MR. ROSEN:

 

17   Q.  So two credit cards in joint name, Wells Fargo and a gas

 

18   company card, right?

 

19   A.  That's all I remember right now.

 

20   Q.  Okay.  And you have records of these credit card charges,

 

21   right?

 

22   A.  Yes.

 

23   Q.  So if you wanted to know exactly what they were you could

 

24   have brought them in or you could have looked at the records

 

25   before you testified, right?

 

                                                           549

 

 1             Or are they in Canada, too, ma'am?

 

 2   A.  I believe that - I don't believe I'm in possession of 1998

 

 3   records at this time.

 

 4   Q.  Is that because you threw them out?

 

 5   A.  No.

 

 6   Q.  Then tell me how you came to be dispossessed, that's - I

 

 7   don't think that's a word - out of possession of?

 

 8   A.  I'm in the process of moving.  I'm trying to move back East

 

 9   to get closer to my husband.

 

10   Q.  So does that mean in the process of moving you threw out

 

11   some of these records?

 

12   A.  No.

 

13   Q.  Does it mean in the process of moving you sent them to your

 

14   husband or gave them to him in Canada?

 

15   A.  I sent some of them to him.

 

16   Q.  What about the rest of them?

 

17   A.  They went on a truck or I sent them by - by shipment, by box

 

18   shipment.

 

19   Q.  Okay.  So you didn't throw any out.  All of these -

 

20   A.  I - I haven't -

 

21   Q.  - records that you don't have, to your knowledge, are now in

 

22   the possession of your husband in Canada, right?

 

23   A.  Or they're in storage just where I have sent some of my

 

24   records.

 

25   Q.  And where is that?

 

                                                           550

 

 1   A.  It's in the United States.

 

 2   Q.  Can you tell me what state it's in?

 

 3   A.  New York.

 

 4   Q.  So you have sent some of the records from your home for - to

 

 5   some storage facility or some person to store for you in the

 

 6   state of New York?

 

 7   A.  Yes.

 

 8   Q.  And those include records of the financial affairs of you

 

 9   and your husband covering the period of time that includes

 

10   February, March of 1998?

 

11   A.  They might be.  I don't know, I was just packing and sending

 

12   it.  I don't remember what went in which box.

 

13   Q.  Got you.  Okay.  What was - in February of '98 what was the

 

14   balance due on the Wells Fargo card?

 

15   A.  I don't remember.

 

16   Q.  What was the balance due on the gasoline card in February of

 

17   '98?

 

18   A.  I don't remember specifically.  I know what it tended to run

 

19   from month to month.

 

20   Q.  Now I'm asking you for a recollection of what it was that

 

21   month.

 

22   A.  I don't remember.

 

23   Q.  What was the balance due on the Wells Fargo credit card for

 

24   - in the month of March 1998?

 

25   A.  I don't remember.

 

                                                           551

 

 1   Q.  What's the balance due today on that card?

 

 2   A.  On the Wells card?

 

 3   Q.  On the Wells Fargo card, what's the balance due today?

 

 4   A.  I couldn't tell you exactly, but it may be $10,000.

 

 5   Q.  Now when was the last - when did you last get your statement

 

 6   from Wells Fargo?

 

 7   A.  Two or three weeks.

 

 8   Q.  And I assume you opened the statement and looked at it,

 

 9   right?

 

10   A.  Yes.

 

11   Q.  Did you make a payment on that - on that statement, that

 

12   credit card statement?

 

13   A.  It's a complex question because they have had the wrong

 

14   address and they called me up and told me what the balance was.

 

15   I didn't get the statement until after they told me, so I made

 

16   the payment by transferring funds at their request over the

 

17   phone.  I didn't pay the - I didn't pay for the bill.

 

18   Q.  The bank had the wrong address.

 

19   A.  Um-hum.

 

20   Q.  I thought your address was the same addresses of the house

 

21   that you and Mr. Henson had been living in since 1996?

 

22   A.  No.

 

23   Q.  You have a different address?

 

24   A.  Yes.

 

25   Q.  Since when have you had a different address?

 

                                                           552

 

 1   A.  Since almost two - two months after we moved to the house.

 

 2   Q.  You've had a different residence address from your husband

 

 3   since 1996?

 

 4   A.  No.

 

 5   Q.  You've had a different mailing address?

 

 6   A.  We have had -

 

 7             THE COURT:  Excuse me.  This sounds like it's going to

 

 8   go into the joint tenancy issue.

 

 9             MR. ROSEN:  No, it's not.  No, it has - I think the

 

10   witness has just said, she's lived in the house.  It's not a

 

11   question of abandonment of her residence.

 

12             But I think what she's saying is she had a different

 

13   mailing address.

 

14   BY MR. ROSEN:

 

15   Q.  Is that what you're saying?

 

16             THE COURT:  Well, let's - I don't - I don't think you

 

17   should ask her about the house, I've just decided myself.

 

18   BY MR. ROSEN:

 

19   Q.  Okay.  All right.  You say the bank sent this bill to the

 

20   wrong address.  Is the address that the bank sent the bill to,

 

21   Wells Fargo, the same address it had been sending the bill to

 

22   all along?

 

23   A.  No.

 

24   Q.  It - it changed and sent to a different address?

 

25             THE COURT:  Stop with the addresses, please.  I'm

 

                                                           553

 

 1   serious, Mr. Rosen.  Don't ask her about addresses and mailing

 

 2   and living, because I'm concerned that that may be used in the

 

 3   context of the joint -

 

 4             MR. ROSEN:  All right.  I'll just make a note and ask

 

 5   it in the afternoon, okay.

 

 6             THE COURT:  Right.

 

 7             MR. ROSEN:  Okay.  I don't see how, Your Honor, but

 

 8   I'll defer to your -

 

 9             THE COURT:  I don't - I don't know -

 

10             MR. ROSEN:  - your concern.

 

11             THE COURT:  - for sure either.

 

12             MR. ROSEN:  Yeah, okay.

 

13             THE COURT:  I'm being extra cautious.

 

14   BY MR. ROSEN:

 

15   Q.  Okay.  Let's go onto something else.

 

16             Ms. - Ms. Lucas, is it correct that whatever credit

 

17   card balance you and your husband had as of February of 1998,

 

18   you know, the amount that you owed in total on all credit cards,

 

19   that subsequent to that that balance increased, yes or no?

 

20             THE COURT:  From when to when?

 

21             MR. ROSEN:  After February of '98.

 

22             THE COURT:  To today?  I mean compared -

 

23             MR. ROSEN:  Yeah, to today.

 

24             THE COURT:  - February '98 to today?

 

25             MR. ROSEN:  To today.

 

                                                           554

 

 1             THE WITNESS:  I believe that the balance went up and

 

 2   down.

 

 3   BY MR. ROSEN:

 

 4   Q.  Let me ask the question this way.  Do you and your husband

 

 5   owe more money on credit cards today than you did in February of

 

 6   1998?

 

 7   A.  I owe more on my credit cards.

 

 8        (Witness' cell phone ringing.)

 

 9             THE WITNESS:  Please excuse me.

 

10             THE COURT:  Okay.  Go ahead.  If you want to take it

 

11   outside, you can.

 

12             THE WITNESS:  Thank you, sir.

 

13             THE COURT:  If it's a personal call, come right back.

 

14             THE COURT:  Go off the record.

 

15        (Recess taken from 11:18 a.m. to 11:36 a.m.)

 

16             THE COURT:  Ms. Lucas.

 

17             THE WITNESS:  Your Honor, I found an attorney who says

 

18   he can appear and that he will meet me this afternoon at 12:30.

 

19   I'll require a little time to try to bring him up to speed.

 

20             THE COURT:  Okay.  And you understand - are we on the

 

21   record, Liz?  Yeah.

 

22             You understand I don't know that you need an attorney

 

23   for this.  You have to decide with him whether or not - or her

 

24   whether you need anybody for this.  I just want you to know that

 

25   the issues, because Mr. Rosen has said there are issues that are

 

                                                           555

 

 1   going go into - that may be relevant to whether or not RTC

 

 2   thinks that you have a joint interest in the Palo Alto property.

 

 3             THE WITNESS:  Yes, Your Honor.  Thank you.

 

 4             THE COURT:  That's fine.

 

 5             Can you go into a totally unrelated area for a while?

 

 6             MR. ROSEN:  Yeah.

 

 7             THE COURT:  And then we'll break for lunch.

 

 8             MR. ROSEN:  Well, I was going to suggest that I think

 

 9   I can be close to finishing by 12:30.  So if that would be a

 

10   good time to break for lunch and at the same time per what Ms.

 

11   Lucas said, she can meet with her counsel, and then we can

 

12   resume at 1:30 and finish.  As I say, I'm - I expect we're going

 

13   to finish today.

 

14             THE COURT:  Why don't you go ahead.

 

15             MR. ROSEN:  Okay.

 

16   BY MR. ROSEN:

 

17   Q.  Ms. Lucas, a moment ago, before the break when I asked you

 

18   about the credit card balances, you said, quote, they went up

 

19   and down.  I just want to make sure I understand what you mean

 

20   by that.

 

21             The - you get a bill for - on a credit card.  And

 

22   let's say for argument's sake it says you owe $5,000.  But you

 

23   have an option of paying a minimum amount.  Whatever it might

 

24   be, a hundred dollars.  You don't have to pay the entire thing.

 

25   And you can carry that balance forward month to month as long as

 

                                                           556

 

 1   you make the minimum payments.

 

 2             So is that what you're referring to when you say the

 

 3   balances went up and down?

 

 4   A.  That's part of it, yes.

 

 5   Q.  Okay.  And the practice of paying less than a hundred

 

 6   percent of what is due on the credit card, of carrying a balance

 

 7   from month to month and paying either a minimum or something

 

 8   less than the entire amount due, is that a practice that existed

 

 9   with respect to you and your husband's credit cards in February,

 

10   March of 1998?

 

11   A.  1998.  At that time, yes, I believe it was.

 

12   Q.  Okay.  And, in fact, that practice existed going back to at

 

13   least the middle of '97, that you and your husband were making

 

14   payments of less than the entire bill on your credit cards;

 

15   isn't that true?

 

16   A.  During some period, I don't remember when, but when we had

 

17   money we paid them off every month.

 

18   Q.  Yeah.  But I'm saying the practice - your not having money

 

19   and paying something less than the entire amount of the bill,

 

20   that practice dated back to some time in the summer of '97,

 

21   didn't it?

 

22   A.  It seems likely because I believe it was in early '97 that

 

23   he lost his - his main client.

 

24   Q.  Okay.  Now yesterday, ma'am, you testified that you engaged

 

25   the movers, this moving truck to move, among other things,

 

                                                           557

 

 1   papers, files respecting the litigation your husband was engaged

 

 2   in, and some family memorabilia that I believe you said you and

 

 3   your husband are the respective family members in charge of

 

 4   maintaining that.  Do you recall that testimony?

 

 5   A.  Yes.

 

 6   Q.  Okay.  Let me - I don't want to go into the contents of it,

 

 7   but I would like you to try and help me out.  What I'm holding

 

 8   up here is what lawyers call a transfile box or a banker's box.

 

 9   Do you see it?

 

10   A.  Yes.

 

11   Q.  And you see the capacity of this box?

 

12   A.  Yes.

 

13             MR. ROSEN:  And the let the record reflect it is I

 

14   believe the standard of sizes of 18 inches by 12 inches with a

 

15   depth of 18 inches.

 

16   BY MR. ROSEN:

 

17   Q.  How many - approximately how many of these boxes by way of

 

18   trying to get an idea of the content of files and papers and

 

19   family memorabilia did you pack up to put - and put on the

 

20   moving truck to go to Canada, roughly?

 

21   A.  I - this is such a stressful period and other people were

 

22   moving the boxes.

 

23   Q.  I'm only asking for the boxes that went on the truck.  The

 

24   truck -

 

25   A.  I understand that.

 

                                                           558

 

 1   Q.  - that was loaded about 10 days or two weeks ago.

 

 2   A.  I understand that.  I'm just - like I say, it's a very

 

 3   stressful period and I had other - I had friends moving boxes

 

 4   from different places at different times.

 

 5   Q.  No.  I'm not asking about moving boxes from different

 

 6   places.  I'm only asking for the ones the went on this U-Pack.

 

 7   A.  Yes.  But they came from different places -

 

 8   Q.  Okay.

 

 9   A.  - at different times over three days.

 

10   Q.  All right.  And as they went on the U-Pack, how many of

 

11   these size boxes were the equivalent content was there in these

 

12   files and papers and personal papers and memorabilia, family

 

13   memorabilia, what's the total here?

 

14   A.  I don't know.  I - I'd estimate maybe three dozen.

 

15   Q.  Okay.  How much does it cost to mail a box like this Parcel

 

16   Post to Canada?

 

17   A.  I don't know.

 

18   Q.  Well, you have mailed packages to your husband in Canada?

 

19   A.  I haven't used Parcel Post, and where any large box was

 

20   concerned, I haven't used mail.

 

21   Q.  Okay.  What manner have you used in terms of sending

 

22   materials to your husband, things like papers from his cases and

 

23   books?  What have you used, if not Parcel Post?

 

24   A.  I've only mailed smaller packages to him.  Small packages.

 

25   Anything larger than that I've sent to my own facility.  I've

 

                                                           559

 

 1   sent to another facility inside the United States.

 

 2   Q.  Okay.  So of the larger ones that go in a box, let's say of

 

 3   this size, that you sent to your facility in New York, what does

 

 4   it cost to mail that, a box like this?

 

 5   A.  I don't know about mail, but FedEx Ground, if it weighs 30,

 

 6   30, 40 pounds, 15 or $20 maybe.

 

 7   Q.  Is that how you sent it, FedEx?

 

 8   A.  Ground.

 

 9   Q.  Is that how you sent it?

 

10   A.  That's how I've been -

 

11   Q.  FedEx Ground?

 

12   A.  - sending papers that did not make it onto the truck, except

 

13   for small packages.

 

14   Q.  The papers that you're talking about you sent FedEx Ground

 

15   were ones that you sent to this other person or storage facility

 

16   in New York?

 

17   A.  That I sent FedEx Ground, yes.

 

18   Q.  Okay.  How many packages would you say, small - whether

 

19   they're small or large, you sent to your husband in Canada?  And

 

20   I'm not talking about what was on the moving truck, but

 

21   separately, how many packages?

 

22             You testified, for example, yesterday about there were

 

23   some books that you sent to him, some magazines, some papers

 

24   from the files, the litigation files.  How many packages did you

 

25   send to him?

 

                                                           560

 

 1   A.  I mailed him small packages, perhaps once a week since he

 

 2   left.  And I went to Canada, I would take him papers and

 

 3   anything that was - that I thought he should have.

 

 4   Q.  Okay.  Did you take him money?

 

 5             Ma'am, did you take him money?

 

 6   A.  Yes.

 

 7   Q.  And did you also send him money?

 

 8   A.  No.

 

 9   Q.  Okay.  How many times have you been to Canada to see your

 

10   husband since he left the United States in May of 9- - of 2001?

 

11   A.  About eight times.

 

12   Q.  And would it be your intention then, ma'am, that you would

 

13   continue to either send or take him money as - as he needed it?

 

14   That would be your intention?

 

15   A.  I don't have any money to take him.

 

16   Q.  If you were to have money and he needed it, -

 

17             MR. ZLOTOFF:  I'm going to object.  It's speculation.

 

18             THE COURT:  Sustained.

 

19   BY MR. ROSEN:

 

20   Q.  You don't have any money at the moment; is that what you

 

21   mean?

 

22   A.  I'm unemployed.

 

23   Q.  How long have you been unemployed, ma'am?

 

24   A.  Since August 30.

 

25   Q.  Okay.  How many times have you taken money to your husband?

 

                                                           561

 

 1   A.  Possibly twice.

 

 2   Q.  And if - if you were to receive money by virtue of the sale

 

 3   of the house, would you then take that money to Canada?

 

 4   A.  There would be a separate transfer of our differing funds.

 

 5   Q.  My question is would you take that money to Canada?

 

 6             MR. ZLOTOFF:  Whoa, whoa.  Objection.

 

 7             THE COURT:  Sustained.

 

 8   BY MR. ROSEN:

 

 9   Q.  If you were allowed to enter Canada - I think you testified

 

10   yesterday you've applied for some - to immigration or some sort,

 

11   would you take that money to Canada?

 

12             MR. ZLOTOFF:  Which money?  Objection.

 

13             THE COURT:  Sustained.

 

14             MR. ROSEN:  The money that she would get -

 

15             THE COURT:  The problem is that you're not making a

 

16   differentiation between her separate money that she would get

 

17   and his money that he would get.

 

18             MR. ROSEN:  Of course I did.  It's - it's inherent in

 

19   the question.

 

20             THE COURT:  Well, it wasn't -

 

21             MR. ROSEN:  It's money she would get.

 

22             THE COURT:  - and it was ambiguous.  And I am

 

23   therefore sustaining the objection.  And you should rephrase the

 

24   question rather than arguing with me.

 

25   BY MR. ROSEN:

 

                                                           562

 

 1   Q.  Okay.  With respect to the portion of the money that you

 

 2   would get from the sale of the house, would it be your intention

 

 3   then to take the money to Canada?

 

 4   A.  In the first place, I have made no application for status in

 

 5   Canada.

 

 6             In the second, it's my intention to take money

 

 7   wherever I will be moving.  If I get a job somewhere, then that

 

 8   is where I will take it.

 

 9   Q.  But your present intention and desire is to move to Canada

 

10   to be with your husband, right?

 

11   A.  That's my desire, but immediately all I can do is visit him.

 

12   Q.  Right.  And if you do move to Canada or if you just go to

 

13   visit him, would it be your intention to take the money of your

 

14   share of the sale of the house to Canada?

 

15   A.  I don't have any plans about the money at this point.

 

16   Q.  And if Mr. Henson were to receive any money from the sale of

 

17   the house and for some reason it was entrusted to you, would you

 

18   then get - bring it to him or send it to him?

 

19             MR. ZLOTOFF:  Objection, speculation.

 

20             THE COURT:  Sustained.

 

21             MR. ROSEN:  Speculation?

 

22             THE COURT:  And "if...some reason," "for some reason

 

23   it was entrusted to you," that's speculation.

 

24             MR. ROSEN:  Okay.

 

25             THE COURT:  That's based on facts not in evidence.

 

                                                           563

 

 1   BY MR. ROSEN:

 

 2   Q.  If - if Mr. Henson receives what he has claimed by way of

 

 3   funds from the sale of the house, that he has already claimed by

 

 4   way of his exemption, if that money were given to you, would you

 

 5   take it to Canada for him?

 

 6             MR. ZLOTOFF:  Objection.

 

 7             THE COURT:  Sustained.

 

 8             MR. ZLOTOFF:  Why would the money be given to her?

 

 9             THE COURT:  Sustained.  Sustained.  Sustained.

 

10   Speculative.

 

11   BY MR. ROSEN:

 

12   Q.  Other than the box -

 

13             MR. ROSEN:  I'm sorry.  Did you say something?

 

14             THE COURT:  Speculative, based on facts not in

 

15   evidence.

 

16   BY MR. ROSEN:

 

17   Q.  Other than the three dozen boxes you said of papers and

 

18   files and memorabilia that went on the moving truck, the - for

 

19   Canada, can you describe what else was on that truck?

 

20   A.  I described some of it yesterday.  There is a chest of

 

21   drawers with personal items in the drawers to - to give a

 

22   structural - it's by linear foot, so it's nine feet tall, so

 

23   it's good to stack it as high as you can.

 

24             There was a mattress and box springs, two portions of

 

25   the bottom of the bed to hold them.  A tool chest, a large tool

 

                                                           564

 

 1   chest.  Tools.  Computers.  Various electronic bits and pieces,

 

 2   electronic test equipment.

 

 3             There was flatware, kitchen utensils, clothing, a

 

 4   couple of small rugs, bedding, a telephone.

 

 5             There were books and magazines.

 

 6   Q.  Mr. Henson's books and magazines?

 

 7   A.  There were some of mine.

 

 8   Q.  Okay.  Have you finished describing the contents of the

 

 9   moving van?

 

10   A.  I'm just trying to remember as I speak.  I'm -

 

11   Q.  Okay.  If you think of anything else you can let me know.

 

12             What would you say is the total fair market value of

 

13   the entirety of what you've just described as being on the

 

14   moving van?  And I'm excluding the box - the three dozen boxes

 

15   of paper and files and family memorabilia?  What is the fair

 

16   market value of everything else, tools and tool boxes and pieces

 

17   of a bed?

 

18   A.  I don't know what is meant by fair market value.

 

19   Q.  Fair market value as I mean it, ma'am, if I can clarify my

 

20   question is what a willing buyer is willing to pay a willing

 

21   seller.

 

22             THE COURT:  Do you - under nonpressured circumstances,

 

23   right?

 

24             MR. ROSEN:  Arm's-length transaction.

 

25             THE COURT:  Right.  So it's under nonpressured

 

                                                           565

 

 1   circumstances.

 

 2             MR. ROSEN:  It's not a fire sale.

 

 3             THE COURT:  And we're not talking about a store

 

 4   selling.  We're talking about somebody in your position selling.

 

 5             THE WITNESS:  Thank you, Your Honor.

 

 6             We did make an estimate of the goods for Customs

 

 7   purposes, and I'm trying to remember what that estimate was.

 

 8   BY MR. ROSEN:

 

 9   Q.  And, in fact, the estimate you were required to pay for

 

10   Customs is fair market value, isn't it?

 

11   A.  I don't know.

 

12   Q.  Well, did you make it?

 

13   A.  I conferred with my husband about it -

 

14   Q.  And -

 

15   A.  - and with friends.

 

16   Q.  And you filled out the form for Customs?

 

17   A.  I filled out a list of what was on the truck.

 

18   Q.  And you also filled out a form that says, 'The fair market

 

19   value of these items listed is' blank, and you wrote in a dollar

 

20   amount, right?

 

21   A.  I didn't fill out the Customs form.

 

22   Q.  Who did?

 

23   A.  Mr. Henson did.

 

24   Q.  Did you see the Customs form?

 

25   A.  Yes.

 

                                                           566

 

 1   Q.  How much was the amount of money written on there as the

 

 2   fair market value of these items that were enumerated as being

 

 3   in the truck?

 

 4   A.  I don't recollect.  I would have to look at it.

 

 5   Q.  When did you see it, ma'am?

 

 6   A.  The last time that I looked at - well, the - the - I didn't

 

 7   keep a copy of the form, it went with the truck, but the last

 

 8   time that I looked at the list of items was - and looked at the

 

 9   total was the day that it went, the truck went, -

 

10   Q.  And what day was that?

 

11   A.  - which was September - that was September 15th.

 

12   Q.  So on September 15th, take your mind back to September 15,

 

13   two weeks ago.  At that time you saw the Customs form with the

 

14   list of - excuse me - with the fair market value of the items on

 

15   the truck shown on the form, right?

 

16   A.  Yes.

 

17   Q.  What was that number?

 

18   A.  I don't recollect.

 

19   Q.  Well, ma'am, please help me out.  Try to think.  Was it -

 

20   did it have a comma in it?

 

21   A.  Probably - yes, it was -

 

22   Q.  Probably.

 

23   A.  - it was over a thousand, but - but I don't remember -

 

24   Q.  Okay.  It was over a thousand.  Was it over 3,000?

 

25   A.  No.

 

                                                           567

 

 1   Q.  Okay.  So it's somewhere between a thousand and 3,000?

 

 2   A.  I think so.

 

 3   Q.  And that includes all of your personal effects that are on

 

 4   that truck, right?

 

 5   A.  It included the personal effects of mine that were on the

 

 6   truck, yes.

 

 7   Q.  And do you have any personal effects that have any value?

 

 8   A.  Not really.

 

 9   Q.  You have - I don't - I don't want to be personal, and I will

 

10   try to be very delicate.  Your tastes and your attire in

 

11   purchasing clothes, is it the same as Mr. Henson's, as you've

 

12   described in buying secondhand clothes?

 

13   A.  Yes.

 

14   Q.  That's the way you - that's what you purchase for yourself?

 

15   A.  When I do.  I haven't purchased any clothes in three years,

 

16   but yes.

 

17   Q.  When you purchased clothes back in February - in the period

 

18   of February, March 1998, is that the way you purchased clothes?

 

19   A.  Yes.

 

20   Q.  Okay.  Ms. Lucas, are you aware that your husband has

 

21   received money in the way of, let's call them contributions,

 

22   from people who are, let me see, more sympathetic to his view of

 

23   life than they are the Scientology?

 

24   A.  He has received some contributions, I believe.

 

25   Q.  And has he received contributions by mail?

 

                                                           568

 

 1   A.  I believe so.

 

 2   Q.  Well, you opened the mail, so you tell me.  How much has he

 

 3   received since February of 1998?

 

 4   A.  I wasn't keeping track.

 

 5   Q.  Okay.  What do you remember?

 

 6   A.  I remember seeing - opening an envelope that had a $20 bill

 

 7   in it.  I remember opening an envelope that had a check in it,

 

 8   maybe a hundred dollars.  Generally when I saw that an envelope

 

 9   was a contribution to him, I turned - it just gave it to him and

 

10   I didn't take any note of it.

 

11   Q.  But you opened it?

 

12   A.  Yes.

 

13   Q.  Uh-huh.  Now in addition to mail I assume that Mr. Henson

 

14   informed you when he received contributions from another source

 

15   other than mail?

 

16   A.  No.

 

17   Q.  Well, you - you're aware that Mr. Henson received

 

18   contributions other than by mail?  Are you aware of that?

 

19   A.  I think people might have given him cash, but I don't know.

 

20   Q.  And are you aware that he has received contributions by way

 

21   of payment to Paypal or another internet commerce repository?

 

22   A.  He has mentioned that.

 

23   Q.  How much has he mentioned he's received?

 

24   A.  He hasn't told me any amounts.

 

25   Q.  And have you not asked him?

 

                                                           569

 

 1   A.  No.

 

 2   Q.  You don't have any interest in how much?

 

 3   A.  No.

 

 4   Q.  Your husband recently was the beneficiary of an award, a

 

 5   grant by some people in Germany for fighting Scientology, wasn't

 

 6   he?

 

 7   A.  Yes, I saw the press release.

 

 8   Q.  How much did he get for that?

 

 9   A.  I don't know.

 

10   Q.  Is that because you haven't bothered to ask him, that you

 

11   don't know?

 

12   A.  I haven't asked him.

 

13   Q.  And he's not mentioned it to you, his wife, how much he

 

14   received by way of this grant; is that right?

 

15   A.  Mr. Henson does not tell me information that I might -

 

16             THE COURT:  You should just -

 

17             THE WITNESS:  - be required -

 

18             THE COURT:  You should just answer yes or no, because

 

19   he told you how much of the grant and - answer yes or no,

 

20   otherwise he'll object.  See, you have to answer yes or no,

 

21   unless you can't answer yes or no.

 

22             All he asked you was did he tell you how much the

 

23   grant was.  Did Mr. Henson tell you how much the grant was?

 

24             THE WITNESS:  No, he did them.

 

25   BY MR. ROSEN:

 

                                                           570

 

 1   Q.  All right.  Ms. Lucas, before the Judge stopped you, you

 

 2   were about to say something.  Could I ask you to complete your

 

 3   answer?

 

 4   A.  Mr. Henson tends to not tell me things that I might be

 

 5   forced to divulge in testimony, deposition, or whatever, before

 

 6   OSA.

 

 7   Q.  And he tends to do that - he has tended to do that from what

 

 8   point in time, ma'am?

 

 9   A.  Some time in possibly '99 when we began to be picketed,

 

10   harassed, abused, persecuted, sued, et cetera, and deposed.

 

11   Q.  You were used in 1996, not 1999, ma'am.  Does that help

 

12   refresh your memory?

 

13   A.  It helps me refresh my memory in that we were picketed.  And

 

14   it came to our attention that our employers were being picketed

 

15   and that our neighbors -

 

16             MR. ROSEN:  I move to strike.  It's not responsive.

 

17             THE COURT:  Your -

 

18             MR. ROSEN:  The question was, was she - was Mr. Henson

 

19   sued in 1996.

 

20             THE COURT:  No.  Then there was a subsequent question.

 

21             MR. ROSEN:  No.  There - that's my pending question:

 

22   Would it help refresh your memory if I told you Mr. Henson was

 

23   sued in 1996.

 

24             THE COURT:  Something came after that.

 

25             MR. ROSEN:  I don't believe so.  This witness is

 

                                                           571

 

 1   making soapbox speeches again.  I ask to strike it.

 

 2             THE COURT:  Wait, wait, wait.

 

 3             Go back, Liz.  Play it.

 

 4        (Record played.)

 

 5             THE COURT:  Motion to strike is granted.

 

 6             As I understand it, you were explaining why you and

 

 7   Mr. Henson - Mr. Henson weren't disclosing information to you -

 

 8   Mr. Henson wasn't disclosing information to you that could be

 

 9   the subject of your having to testify about; is that right?  Is

 

10   that what you said?

 

11             THE WITNESS:  Yes, Your Honor.

 

12   BY MR. ROSEN:

 

13   Q.  Ms. Lucas, how long has it been that back in - to what point

 

14   in time that you were responsible, as you've described to this

 

15   Court, for opening the mail, opening the bills, paying the

 

16   bills, maintaining the household account?  How long?

 

17   A.  Since about the time we were married.

 

18   Q.  Okay.  Ms. Lucas, do you remember being deposed on December

 

19   17th, 1998?

 

20   A.  How could I forget.

 

21   Q.  Good.  Do you remember where it was?

 

22   A.  I thought I was deposed only in the offices of Mr. Hogan.

 

23   Q.  Do you remember who questioned you at that time?

 

24   A.  1998?

 

25   Q.  Yeah.

 

                                                           572

 

 1   A.  I -

 

 2             THE COURT:  What month was it?

 

 3             What month was it?

 

 4             MR. ROSEN:  I said December 17th.

 

 5             THE WITNESS:  If that was the first deposition or the

 

 6   first 2004 examination, it was Ms. Kobrin and Mr. Cartwright,

 

 7   but I don't remember if that was the date.

 

 8   BY MR. ROSEN:

 

 9   Q.  Ms. Lucas, do you recall at that examination being shown

 

10   your bank records from this joint account, this household

 

11   account from 1995, and being asked the following question,

 

12   giving the following question, starting on the first page of

 

13   these, and the "these" refers to Exhibit 5, which I'll be happy

 

14   to hand up, the bank records from Wells Fargo, it reflects

 

15   deposits that say "NDMA" next to them.

 

16             "Are those payroll deposits?

 

17             "ANSWER:  I don't know what that means."

 

18             Do you remember giving that answer?

 

19   A.  Not that particular answer, no.

 

20   Q.  It doesn't sound at all familiar to you?

 

21   A.  Well, I remember that there were several acronyms that I

 

22   couldn't figure out what they were, I didn't know what they

 

23   were.

 

24   Q.  Acronyms by way of letters that appeared on your bank

 

25   statements for the household account that was under your

 

                                                           573

 

 1   control, right?

 

 2   A.  Yes.

 

 3   Q.  And continuing on in that deposition you were then asked for

 

 4   an entry on the bank statement of November 15 - November 18,

 

 5   1995.  An entry at the bottom of the checking account that says,

 

 6   quote, deposit AD, close quote.

 

 7             Do you recall testifying you didn't know what that

 

 8   was?

 

 9   A.  I probably did because I don't know what it is now.

 

10   Q.  Okay.  Do you recall - let's go - let's get more closer to

 

11   the filing date.

 

12             Do you recall being asked the following question and

 

13   giving the following answer:

 

14             "QUESTION:  The next statement, April 16th, '97 to

 

15   20th of May '97 in the liquid assets section there's a 17 April

 

16   withdrawal of - it's the same account - of $3500.  Do you know

 

17   what that was for?

 

18             "ANSWER:  Not without - I don't remember what it was

 

19   for specifically.  It may have gone into housekeeping account to

 

20   reimburse the payments my husband had made."

 

21             Do you remember giving that answer?

 

22   A.  I don't remember that answer specifically.

 

23   Q.  Remember being asked this question and giving this answer:

 

24             "Then below in the checking account box there's an

 

25   item, 5-95, $3,000 deposit on 25 of April.  Do you know what

 

                                                           574

 

 1   that was for

 

 2             "ANSWER:  Is that a deposit or a check?  It must be a

 

 3   check.

 

 4             "QUESTION:  It's a check.  Do you know what that was

 

 5   for?

 

 6             "Well, I would guess that the money from the liquid

 

 7   asset went into the checking account."

 

 8             THE COURT:  You know, I can't follow this at all.  I

 

 9   don't have a copy of this.  I don't know what you're reading

 

10   from.

 

11             MR. ROSEN:  I told you what I was reading from.

 

12             THE COURT:  But I don't have it.  So there's no way I

 

13   know whether what you're asking her is an accurate

 

14   representation of anything.

 

15             MR. ROSEN:  Oh, I'm sorry, Your Honor.  I represent it

 

16   as accurate if I'm purporting to read from a transcript.  That's

 

17   inherent in what I'm doing.

 

18             THE COURT:  Yeah, the -

 

19             MR. ROSEN:  Okay.

 

20             THE COURT:  The whole process is inappropriate.

 

21   BY MR. ROSEN:

 

22   Q.  Okay.  Let's go on.  Let me take you up and I'm -

 

23             MR. ROSEN:  I'm at 69.  If Your Honor wants a copy

 

24   I'll be happy to photostat it during the lunch break.

 

25   BY MR. ROSEN:

 

                                                           575

 

 1   Q.  You now ask Ms. Henson about Mr. - excuse me, Ms. Lucas -

 

 2   about Mr. Henson's bankruptcy schedule.

 

 3             "QUESTION:  Now Mr. Henson put in this, on this

 

 4   document that his regular income from operation of business

 

 5   Professional of Farm [phonetic], is $4200 a month.  Do you know

 

 6   if that's an accurate number?

 

 7             "ANSWER:  No.

 

 8             "QUESTION:  Does that mean, 'No, I don't know.'

 

 9             "ANSWER:  It means, 'No, I don't know.'

 

10             "QUESTION:  Do you know what he was making at the time

 

11   he filed this August 1998 - this is the amended schedule?

 

12             "ANSWER:  No, he did not tell me."

 

13             Do you remember giving those answers, ma'am?

 

14   A.  I don't remember them particularly.

 

15   Q.  Well, I'm confused now because you've testified in this

 

16   court that you knew what your husband was making, that you

 

17   looked at the invoices, that you opened the envelopes, that you

 

18   saw the invoices he sent out, you saw the checks he received and

 

19   the 1099 forms.  You testified to all of that, right?

 

20   A.  Yes, for different time periods.

 

21   Q.  Well, let's look at the time period of August 1998.  Here

 

22   you don't have any idea what your husband's making?

 

23   A.  Didn't you say that deposition was in December?

 

24   Q.  Right.  And you were asked about events of August '98, the

 

25   August 4th, 1998 Schedule in Bankruptcy.

 

                                                           576

 

 1             So are you saying in August of 1998 you weren't

 

 2   opening the mail, you weren't checking your husband's invoices,

 

 3   you weren't looking - seeing the checks that he was being paid;

 

 4   is that what you're saying?

 

 5             MR. ZLOTOFF:  Your Honor, I'm going to - I'm going to

 

 6   object because I thought that deposition transcripts except for

 

 7   rebuttal were supposed to be marked and provided as part of

 

 8   the -

 

 9             THE COURT:  The whole thing is inappropriate, what

 

10   he's doing.  You have to ask a question and then if you want to

 

11   use it for impeachment, you have to provide the witness with a

 

12   copy of it.  And - and then ask, when you're impeaching, ask

 

13   whether that was her testimony and whether she - she agrees that

 

14   it's the correct thing now.  Nobody has copies of any of this,

 

15   and it hasn't been shown to impeach.

 

16             MR. ROSEN:  Your Honor, I'm - I must beg Your Honor's

 

17   indulgence, since this is the first time I've ever appeared in

 

18   this court.  I have appeared in 56 federal district courts of

 

19   the United States.  I've never shown a witness an impeachment

 

20   testimony transcript.

 

21             I can certainly do it the way you want which is first

 

22   elicit the testimony and then read her the testimony, which is

 

23   inconsistent.  Certainly I could do that.

 

24             THE COURT:  And then I could follow along to find out

 

25   whether or not it was real or not.

 

                                                           577

 

 1             MR. ROSEN:  Yeah.  Well, except Your Honor is now

 

 2   telling me a rule that you apparently have that I must say is

 

 3   foreign to the entire federal practice of my 34 years.

 

 4             So let's try it this way.

 

 5   BY MR. ROSEN:

 

 6   Q.  Ms. Henson - excuse me.  Ms. Lucas, did you know how much

 

 7   your husband was making in August of 1998?  Yes or no.

 

 8   A.  I don't know.

 

 9   Q.  Did you know how much income your husband was receiving in

 

10   August of 1998?

 

11   A.  I don't know.

 

12   Q.  As of August of 1998 did you know what your husband's

 

13   monthly income was for the seven or eight months of that year?

 

14   You know, so much per month.  Did you know that then?

 

15   A.  I probably -

 

16             THE COURT:  Did she know it then, in August of '98; is

 

17   that the question -

 

18             MR. ROSEN:  In August of '98.

 

19             THE COURT:  Not whether she knows it now, if she knows

 

20   it then.

 

21   BY MR. ROSEN:

 

22   Q.  I'm sorry.  Do you know it now?

 

23             THE COURT:  Well, I just want to know what the

 

24   question is.  You can ask whatever question you want.  I just

 

25   want to know -

 

                                                           578

 

 1             MR. ROSEN:  I thank you.  You corrected me.

 

 2   BY MR. ROSEN:

 

 3   Q.  Do you know today as you're sitting here the amount, the

 

 4   monthly income your husband had been received in the - in the

 

 5   year 1998 as of August of '98 - up to August?

 

 6   A.  I don't remember.

 

 7   Q.  Ms. - Ms. Lucas, were you opening the mail addressed to your

 

 8   husband in August of '98?

 

 9   A.  Yes.

 

10   Q.  Were you examining the invoices your husband sent to clients

 

11   in 1998?

 

12   A.  I occas- -

 

13   Q.  Yes or no, ma'am.

 

14   A.  I can't answer it yes or no.

 

15   Q.  Well, I think the question can be answered yes or no.

 

16             THE COURT:  If you'll let her explain why she can't

 

17   answer yes or no, you may get an answer.

 

18             MR. ROSEN:  Okay.

 

19             THE COURT:  I'm not going to direct her unless you ask

 

20   her that.

 

21   BY MR. ROSEN:

 

22   Q.  The question is were - in August of '98 were you looking at,

 

23   did you have an opportunity to see invoices that your husband

 

24   sent to clients?

 

25   A.  My husband sometimes made copies of his invoices.  He

 

                                                           579

 

 1   generally sent them by electronic mail.  He also received checks

 

 2   not through the mail, as a general rule.  So I can't tell you

 

 3   when I saw an invoice and when I didn't because he was

 

 4   inconsistent about showing me copies.

 

 5             If I asked him, because I was having to make a

 

 6   quarterly report for income tax purpose, "What are you making,"

 

 7   "What's" - you know, "What" - "What kind of estimate can we give

 

 8   them," then he would sometimes produce some copies of invoices.

 

 9   I would usually know approximately what he was making at any one

 

10   time.

 

11             There are certainly times when he did not - he

 

12   purposely did not tell me where he was working or what he was

 

13   making so that his employers would not be harassed.

 

14             MR. ROSEN:  Objection, move to strike that.

 

15             THE COURT:  Overruled.

 

16             MR. ROSEN:  The question was whether she knew in

 

17   August of '98, had she seen the invoices her husband sent.  It

 

18   was a simple question.  It could have been answered yes or no.

 

19             THE COURT:  Overruled.

 

20             MR. ROSEN:  Your Honor, do I have to deal with - I'm

 

21   confused about something.  You have allowed over my objection

 

22   testimony from this witness about harassment of some

 

23   unidentified sort - kind.  Are you taking that for the truth of

 

24   it, that I have to rebut this?  Because that's the reason I move

 

25   to strike it.

 

                                                           580

 

 1             THE COURT:  I don't tell you what's in my mind during

 

 2   a trial.  I make evidentiary rulings.

 

 3             MR. ROSEN:  But, Your Honor, I'm entitled to have

 

 4   notice of whether or not you are taking these speeches about

 

 5   harassment as for the truth.

 

 6             THE COURT:  No, you're not.  You're not entitled to

 

 7   anything.  I make evidentiary rulings.  You're not entitled to

 

 8   know what's in my mind.

 

 9             MR. ROSEN:  May I ask that - may I then move that Your

 

10   Honor exclude these speeches about threats and harassment for

 

11   the truth of the matter asserted, that they not be received for

 

12   truth of the matter asserted by - by this witness?

 

13             MR. ZLOTOFF:  I would object, Your Honor.  I mean what

 

14   are they supposed to be admitted for?  For the lies?  You know,

 

15   she's saying - she's saying what she's saying and she's under

 

16   oath, so I don't know it shouldn't be accepted for the truth.

 

17             MR. ROSEN:  Her own testimony shows it's hearsay.  Do

 

18   I have to then go into the hearsay of 'Somebody told me' - 'My

 

19   husband told me that his employer had done' - 'had been

 

20   threatened'?  That's the problem, Your Honor.  You just open up

 

21   a whole can of worms.

 

22             If you want me to, I'll - I'll go through this, but

 

23   that's the essential problem of allowing this testimony in.

 

24             MR. ZLOTOFF:  This is the first I've heard that it's

 

25   hearsay.  I don't know that it's hearsay or not.  I mean we

 

                                                           581

 

 1   could - she - he could certainly find out whether it's hearsay,

 

 2   but that's a different matter.

 

 3             MR. ROSEN:  Is Your Honor admitting this for the

 

 4   truth?

 

 5             THE COURT:  I have no intention of telling you that at

 

 6   this point, Mr. Rosen.  You should -

 

 7             MR. ROSEN:  Okay.  Well, we can -

 

 8             THE COURT:  You should make your own decision as to

 

 9   what you want to do on the record -

 

10             MR. ROSEN:  No.  I think it's terribly unfair for the

 

11   Court to allow this testimony in backdoor when the witness

 

12   provides it, not responsive to a question, and then say, 'Mr.

 

13   Rosen, I'm not going to tell you if' - 'when I consider this

 

14   transcript and write my decision whether I've accepted that for

 

15   the truth of it.'  I think that's terribly unfair.

 

16             I'm entitled to notice of what the claim is against

 

17   me.  This is a defense.  Am I entitled to notice of a defense?

 

18   am I entitled to a pretrial order that Mr. Zlotoff has to live

 

19   by of the evidence he's presenting?

 

20             Your Honor's looking at me.  You - I assume that from

 

21   that you're not going to respond; is that right?  Shall I go on?

 

22             THE COURT:  You're questioning a witness and you might

 

23   as well ask your questions.

 

24   BY MR. ROSEN:

 

25   Q.  Okay.  Ms. Lucas, tell me the names of - withdraw that.

 

                                                           582

 

 1             From your personal experience, not what you read, not

 

 2   what somebody told you, what you saw with your own eyes, tell me

 

 3   the names of the employees of RTC who have in any way threatened

 

 4   or harassed you, your husband, or anybody else.

 

 5   A.  People would not give their names.

 

 6   Q.  Okay.  Now did they have signs on them that said "Religious

 

 7   Technology Center"?

 

 8   A.  There were picket signs -

 

 9   Q.  Yes or no.  Were there signs that said, "I work for

 

10   Religious Technology Center"?

 

11             THE COURT:  If they have a picket sign, that's a sign.

 

12   Would you let her answer.  That is a sign.

 

13             MR. ROSEN:  No, it's not.

 

14             THE COURT:  If it's - well, I don't want to argue with

 

15   you.  If she wants to answer that question about whether they

 

16   were carrying a sign, I'll let her answer it "carrying a sign."

 

17   You've said were there signs.

 

18   BY MR. ROSEN:

 

19   Q.  Was the person wearing some sort of badge or identification

 

20   that identified that person as a - Religious Technology Center?

 

21   Like a cop wears a badge, was there anything on the person that

 

22   identified them as Religious Technology Center?

 

23   A.  Not as Religious Technology Center, no.

 

24   Q.  Thank you.

 

25             Now with respect to - the comments that you've been

 

                                                           583

 

 1   making about being threatened and harassed and picketed, and all

 

 2   of that, you're talking about conduct that was directed at you

 

 3   or your husband by, quote Scientology?  By the -

 

 4   A.  By the -

 

 5   Q.  - by OSA?

 

 6   A.  By the office of special affairs.

 

 7   Q.  All right.  Now, ma'am, do you have any basis to say that

 

 8   the office of special affairs is even a part of RTC?

 

 9   A.  RTC and the office of special affairs are by other courts'

 

10   rulings part of the global Scientology Corporation, 150 global

 

11   corporations.

 

12   Q.  Ms. -

 

13   A.  It has been recognized by other judges that this is the

 

14   case.

 

15             MR. ROSEN:  Your Honor, I move to strike.  Another

 

16   speech.  I asked a question, 'Do you have any basis to say that

 

17   the office of special affairs is part of RTC.'

 

18             THE COURT:  Well, she told her basis.  It may be

 

19   invalid, but she told you her basis.

 

20   BY MR. ROSEN:

 

21   Q.  All right.  Show me the case that says that OSA, O-S-A, is

 

22   part of RTC?

 

23   A.  I didn't say it was.  I said that they -

 

24   Q.  Thank you.

 

25   A.  - were part of the same organization.

 

                                                           584

 

 1   Q.  Right.  Just like the Archdiocese of San Francisco is part

 

 2   of the same organization as the Archdiocese of New York, right?

 

 3   A.  No.

 

 4   Q.  You made statements about threats made to employers or

 

 5   prospective employers.  I want you to tell me the name of one

 

 6   single person who works for RTC that you have any personal

 

 7   knowledge of who even contacted any of your husband's employers

 

 8   or prospective employers.  Tell me the name of that RTC person.

 

 9   A.  RTC's business is not in that - RTC is the litigation arm of

 

10   the Church of Scientology -

 

11   Q.  You're telling - how do you know that, ma'am?

 

12             THE COURT:  If you're going to -

 

13             THE WITNESS:  I have been reading the internet -

 

14             THE COURT:  - ask her these - wait a minute.  Be

 

15   quiet.  Be quiet.

 

16             THE WITNESS:  Yes, Your Honor.

 

17             THE COURT:  If you're going to ask her these

 

18   questions, then you have to let her finish her answer.

 

19             And you have to let him finish his question.

 

20             THE WITNESS:  Yes, Your Honor.

 

21   BY MR. ROSEN:

 

22   Q.  My question is -

 

23             THE COURT:  You can't interrupt each other.

 

24   BY MR. ROSEN:

 

25   Q.  My question is not whether you think RTC is the litigation

 

                                                           585

 

 1   arm.  I'll repeat my question.

 

 2             Please tell me, ma'am the name of any RTC employee who

 

 3   has ever contacted any of your husband's employers or

 

 4   prospective employers from your personal knowledge.  Not what

 

 5   your husband told you, but from your personal knowledge.  Tell

 

 6   me the name of that RTC employee.

 

 7   A.  RTC is not the whole issue here.

 

 8             MR. ROSEN:  Your - I move to strike that.  That's a

 

 9   yes -

 

10             THE COURT:  Sustained.

 

11             MR. ROSEN:  Thank you.

 

12   BY MR. ROSEN:

 

13   Q.  Now -

 

14             THE COURT:  But keep your voice down.

 

15             MR. ROSEN:  Sorry, Your Honor.  Just not used to

 

16   having trials conduct in this fashion.

 

17   BY MR. ROSEN:

 

18   Q.  At or about August of 1998 did your husband ever tell you

 

19   how much he was making at that time, either -

 

20   A.  I don't remember.

 

21   Q.  Okay.  Now I'll read from page 69 of your deposition,

 

22   December 17th, 1998:

 

23             "QUESTION:  Do you know what he was making at the time

 

24   he filed this - this is the bankruptcy schedule - in August of

 

25   1998?

 

                                                           586

 

 1             "ANSWER:  No.  He did not tell me."

 

 2             Does that refresh your recollection as to whether you

 

 3   knew how much he was making?

 

 4   A.  No, it does not.

 

 5             MR. ROSEN:  Okay.  I'm going to - we'll have to make

 

 6   up an exhibit and offer this, Your Honor.

 

 7             THE COURT:  You're going to make me a copy of the

 

 8   whole thing, you promised me.

 

 9             MR. ROSEN:  No, I'm not.  I did not.

 

10             THE COURT:  Yes, you did.  You said you would make it

 

11   for me during the break.

 

12             MR. ROSEN:  Of the portions I'm reading from.

 

13             THE COURT:  Of the whole transcript so that -

 

14             MR. ROSEN:  No, I didn't say that.  I did not say

 

15   that.

 

16             THE COURT:  Oh, then I misunderstood you.

 

17             MR. ROSEN:  Yeah.  Okay.

 

18   BY MR. ROSEN:

 

19   Q.  Ms. Lucas, as of the time you would - withdraw that.

 

20             Do you know today what companies your husband owned

 

21   stock in?

 

22             THE COURT:  At what time?

 

23   BY MR. ROSEN:

 

24   Q.  Do you know today?

 

25             THE COURT:  What he owns today?

 

                                                           587

 

 1             MR. ROSEN:  No.

 

 2   BY MR. ROSEN:

 

 3   Q.  Do you -

 

 4             THE COURT:  I'm - I didn't -

 

 5             MR. ROSEN:  I'm sorry.  I will withdraw that.  Thank

 

 6   you, Your Honor.

 

 7   BY MR. ROSEN:

 

 8   Q.  Do you - do you know today as you're sitting here what

 

 9   companies your husband owned stock in in the year 1998?

 

10   A.  He may have owned stock in companies.  I - my belief it was

 

11   not worth anything.

 

12             MR. ROSEN:  Move to strike it.  I haven't asked her

 

13   anything about worth.

 

14             THE COURT:  Sustained.

 

15   BY MR. ROSEN:

 

16   Q.  Ms. Lucas, isn't it a fact -

 

17             THE COURT:  "He may have owned stock in companies,"

 

18   period.  That stays, "...it wasn't worth anything" doesn't stay.

 

19   BY MR. ROSEN:

 

20   Q.  Ms. Lucas, in fact, you have testified previously in

 

21   December of 1998 that you had no idea what stock your husband

 

22   owned; isn't that right?

 

23   A.  I don't know.  All I said just a moment ago was that he may

 

24   have owned stock.

 

25   Q.  But you testified previously that you did not know whether

 

                                                           588

 

 1   he owned any stock; isn't that right?

 

 2   A.  Perhaps.

 

 3   Q.  Let me see if I can refresh your recollection.  I read from

 

 4   page 71:

 

 5             "QUESTION:  Do you know what companies your husband

 

 6   owned stock in?

 

 7             "ANSWER:  You already asked me whether I know if he

 

 8   owns stock, and I told you that I don't know.

 

 9             "QUESTION:  Do you know of any companies in which he

 

10   owned stock?

 

11             "ANSWER:  No, I don't."

 

12             Does that help refresh your recollection, ma'am?

 

13   A.  No.

 

14   Q.  You testified in response to a question from Mr. Zlotoff

 

15   about some patents that your husband owns.  And I think there

 

16   were a series of questions about he owns patents, but he doesn't

 

17   get any income stream from them, no payments.

 

18             Do you remember that testimony in this courtroom?

 

19   A.  I think so.

 

20   Q.  Ma'am, when did you first learn that your husband owned

 

21   patents, held any patents?

 

22   A.  I don't remember.

 

23   Q.  Did you learn about it before or after this petition for

 

24   bankruptcy was filed?

 

25   A.  I don't remember.

 

                                                           589

 

 1   Q.  Did you learn about it about a week ago when you met with

 

 2   Mr. Zlotoff to prepare your testimony; is that when you learned

 

 3   about the patents?

 

 4   A.  No.

 

 5   Q.  Ma'am, how many patents does your husband own -

 

 6   A.  I don't know.

 

 7   Q.  - hold?

 

 8             You know he holds patents, letters patent from the

 

 9   United States Patent Office, but you don't know how many they

 

10   are?

 

11   A.  No.

 

12   Q.  Is that right?

 

13   A.  That's right.

 

14   Q.  What do you - how many do you think he owns?

 

15   A.  A couple.

 

16   Q.  And what do they cover?  What invention?

 

17   A.  There's - I think there's one about - oh, it's - they're

 

18   both about space.

 

19   Q.  Okay.  Ma'am, is it correct that you obtained this knowledge

 

20   about your husband's patents after the bankruptcy petition was

 

21   filed?

 

22   A.  I don't remember.

 

23   Q.  In fact, you obtained this information solely for the

 

24   purposes of being a surrogate witness here in this courtroom to

 

25   testify in the absence of your husband, didn't you?

 

                                                           590

 

 1   A.  No.

 

 2   Q.  Let me see if I can refresh your recollection as to what you

 

 3   knew and when you knew it.  I read from page 71:

 

 4             "Do you" - "QUESTION:  Do you know what patents he

 

 5   owns?

 

 6             "ANSWER:  I don't know about any patents that he may

 

 7   own or not own."

 

 8             Does that help refresh your recollection, that as of

 

 9   December 17th, 1998 you didn't know anything about your

 

10   husband's patents?

 

11             Does that refresh your recollection, ma'am?

 

12   A.  No, but I do remember that in some of the exhibits that were

 

13   introduced into the cases in Hemitt and since that there was a

 

14   copy of a - of a payload launch patent.

 

15   Q.  Now that was in the year 2001, right?

 

16   A.  I think so.

 

17   Q.  And that's the first time you found out about this

 

18   particular letter patent that your husband holds, right?

 

19   A.  I don't think so.

 

20   Q.  Let me see if I understand this.  At least as of December

 

21   1998 this man who lived with - who you live with, your husband,

 

22   never told you that he had any patents; isn't that right?

 

23   A.  I don't think that's correct.

 

24   Q.  Well, ma'am, I just read to you, if you'd like me to read it

 

25   again, your testimony, that you didn't know about any patents he

 

                                                           591

 

 1   owned December 17th, 1998?

 

 2   A.  I perhaps said "No," when I should have mis- - said

 

 3   "recollect."  I may have misspoken.

 

 4   Q.  Yeah, okay.  Well, let's talk about the next thing you

 

 5   misspoke under oath.

 

 6             You testified in this courtroom about computers that

 

 7   your husband owned as of 1998.  In fact, we even went over them

 

 8   on the - on the schedule.  Remember that?

 

 9   A.  I think so.

 

10   Q.  And you testified to the computers that your husband owned

 

11   versus another computer that he didn't own and somebody had

 

12   loaned to him, right?

 

13   A.  I think so.

 

14   Q.  And all of that testimony, ma'am, all of that testimony was

 

15   concocted after 1998 because you knew nothing about your

 

16   husband's computers in 1998; isn't that right?

 

17   A.  I'm confused by that logic -

 

18   Q.  All of this knowledge that you've provided to the Court of

 

19   what your husband owned and - by way of computers and how much

 

20   it was worth, and that he had a computer that somebody had

 

21   loaned to him, all of this testimony has - is not derived from

 

22   any knowledge you had in 1998, is it?

 

23             In other words, you learned about all of this after

 

24   1998, right?

 

25   A.  What I remember about 1998 -

 

                                                           592

 

 1   Q.  Well, let me see if I can refresh your recollection -

 

 2             THE COURT:  Let her answer your question.  You didn't

 

 3   let her answer your question.

 

 4             MR. ROSEN:  Oh, I'm sorry.  I thought she was done.

 

 5             THE COURT:  No.  She just started.  "What I remember

 

 6   about 1998," and you wouldn't let her answer.

 

 7             MR. ROSEN:  I - you know, Judge, I didn't interrupt

 

 8   her personally.  I thought she said, "I don't remember."

 

 9             THE COURT:  She started to say, "What I remember about

 

10   1998."

 

11   BY MR. ROSEN:

 

12   Q.  Okay.  I apologize, Ms. Lucas.  Please finish your answer.

 

13             On the subject of what you knew in 1998 about your

 

14   husband's computers.

 

15   A.  I didn't know which ones he owned and which ones had been

 

16   lent to him.

 

17   Q.  So who told you about that after 1998?

 

18   A.  I'm still confused about it to some extent.

 

19   Q.  Then -

 

20   A.  Still one that -

 

21   Q.  - what's the basis for you having testified to that of your

 

22   personal knowledge on the witness stand in this courtroom?  What

 

23   is the basis for that testimony, ma'am?

 

24   A.  There is one computer that I'm still not sure about, but I

 

25   testified as to what I think I know.

 

                                                           593

 

 1   Q.  Let me see if I can refresh your recollection, ma'am.

 

 2   December - December 17th, 1998, page 71:

 

 3             "QUESTION:  Does your husband own any computers?

 

 4             "ANSWER:  I don't know what kind of ownership he has

 

 5   in computers that I have seen and used.

 

 6             "QUESTION:  Well, if he does not own them who would

 

 7   own them?

 

 8             "ANSWER:  I don't know."

 

 9             Do you remember giving that testimony under oath?

 

10   A.  I don't recollect it specifically.

 

11   Q.  Ms. Lucas, you do recall raising your right hand at the

 

12   beginning of this deposition on December 17th, 1998 -

 

13             THE COURT:  Is it a deposition or is that a 2004 -

 

14             THE WITNESS:  It's a 2004.

 

15             THE COURT:  - in this court?  What is it?

 

16             MR. ROSEN:  2004.

 

17             THE COURT:  In this court?

 

18             MR. ROSEN:  In this court, in this case.  In this

 

19   bankruptcy case.

 

20   BY MR. ROSEN:

 

21   Q.  You recall at the beginning of this raising your right hand

 

22   and swearing to the truth, the whole truth, and nothing but the

 

23   truth?

 

24   A.  Not specifically.

 

25   Q.  Do you recall the same oath you took when you took the

 

                                                           594

 

 1   witness stand in this case?

 

 2   A.  I recall the oath in this case, yes.

 

 3   Q.  Did you tell the truth when you were examined in December of

 

 4   1998, ma'am?

 

 5   A.  I did what I could.

 

 6   Q.  Well, what you could was, 'I don't know anything about my

 

 7   husband's computer' -

 

 8             THE COURT:  Mr. Rosen, it's 12:30 and we're going to

 

 9   stop. we agreed that we're going till 12:30.

 

10             MR. ROSEN:  Can I finish the question?

 

11             THE COURT:  No.  We agreed we're going to go till

 

12   12:30.  It's now 12:30.

 

13             MR. ROSEN:  Okay.

 

14             THE COURT:  Now do you want to see whether somebody's

 

15   here and we'll figure out how long we should break.

 

16             Will 1:45 work for you - I mean, yeah, 1:45.

 

17             THE WITNESS:  I think so.

 

18             THE COURT:  Okay.  We'll reconvene at 1:45.

 

19             MR. ROSEN:  Your Honor, can we have access to the

 

20   courtroom at 1:30?

 

21             THE COURT:  No.  You can - unless somebody wants to

 

22   come back early, but otherwise, no, you can come back at 1:45.

 

23   We could start at 2:00.  I want to give them their regular

 

24   lunch.  The answer is no.  You can come back at 1:45 and then

 

25   we'll start at 2:00 if you like.

 

                                                           595

 

 1             MR. ROSEN:  No.  I'll - if you tell me, I'll come back

 

 2   at 1:45, I'll start at 1:45.

 

 3             THE COURT:  But you can take any papers with you to

 

 4   the conference rooms if you like.

 

 5             MR. ROSEN:  Thank you.

 

 6             THE COURT:  I want to give my staff their regular

 

 7   lunch.  Thank you.

 

 8             MR. ROSEN:  Right.  I understand.  Thank you.

 

 9             THE CLERK:  Please rise.

 

10        (Luncheon recess taken from 12:31 p.m. to 1:51 p.m.)

 

11             THE CLERK:  Please rise.

 

12             THE COURT:  Thank you, ladies and gentlemen.  Please

 

13   seated - please be seated.

 

14             MR. ROSEN:  Your Honor, I have some news to report

 

15   which may make Your Honor in a perhaps slightly better frame of

 

16   mind than you were before lunch.  Let me tell you what it is.

 

17             First of all, I think counsel wishes to make an

 

18   appearance and then I will address what -

 

19             MR. HIBBARD:  Good afternoon, Your Honor.  My name is

 

20   Howard Hibbard.

 

21             THE COURT:  Could you spell that, please, sir?

 

22             MR. HIBBARD:  H-i, double b-, as in boy, a-r-d.

 

23             THE COURT:  Thank you, sir.

 

24             MR. ROSEN:  Your Honor, during the luncheon recess we

 

25   consulted with Mr. Hibbard, who is here representing Ms. Lucas.

 

                                                           596

 

 1   We have decided and we have agreed, and Mr. Zlotoff has agreed

 

 2   as well, to the following:

 

 3             Number one, we will withdraw for purposes of this 1307

 

 4   motion any claim respecting the joint ownership.  So we'll take

 

 5   that off the table.  We'll get this hearing done today.

 

 6             Number two, Mr. Hibbard has made a proposal that would

 

 7   resolve the motion to sell the house.  And he and I have

 

 8   discussed the terms.  And I have - I will be candid in the sense

 

 9   of I have told him that it sounds okay to me, but we're going to

 

10   need a little bit of time to get approval of our client and to

 

11   let him know if this deal will fly.

 

12             We have got down to even the nitty-gritty, if you

 

13   will, of who a real estate broker would be who would have the

 

14   listing for the house.  So we have - we have addressed the

 

15   deletes in painstakingly detail, not to sound redundant.

 

16             And the burden is now on me to speak with our client

 

17   and see if we can get approval for this.  If we can get approval

 

18   for this, that would obviate the October 10th hearing on the

 

19   motion to sell and the second half of the motion really, which

 

20   is to distribute the money as opposed to escrowing the money.

 

21             I will commit as follows.  That hearing is on Your

 

22   Honor's calendar for October 10th.  And I will - today is -

 

23   obviously here in court and I'm on my way out of town.  I will

 

24   commit to get back to both Mr. Zlotoff and Mr. Hibbard by

 

25   Monday.  And that would be October 6th, I think, or 7th.

 

                                                           597

 

 1             THE COURT:  The 7th.

 

 2             MR. ROSEN:  The 7th, as to whether we have an

 

 3   agreement and, if so, we're going to have to draft some

 

 4   documents that - that go with it.

 

 5             Yeah, we don't have to get to the details.  Counsel is

 

 6   reminding me we have agreed even on the identity of who the

 

 7   broker is going to be.

 

 8             THE COURT:  You had already said that.

 

 9             MR. ROSEN:  Yeah, okay.  And if we do not reach

 

10   agreement for any reason then the matter will be on Your Honor's

 

11   calendar for October 10th, and Mr. - and part of that motion may

 

12   or may not be, depending upon what Your Honor wants to do with

 

13   it, the litigation of this issue that we're taking out of this

 

14   case at the moment, the - the joint - the concept of joint name

 

15   and Ms. Lucas' claim to half of the net proceeds of the house.

 

16             The reason I say that is because it's going to be up

 

17   to Your Honor.  I'm not sure that it's necessary to decide that

 

18   on the October 10th motion.  Your Honor may decide it may be,

 

19   because the principal point of the motion is for an order to

 

20   sell the house and then comes the second half, which is the

 

21   question of what happens to the proceeds, are they distributed

 

22   versus escrowed.

 

23             In any event, I've agreed, all counsel have agreed

 

24   that if we do not have an agreement, if it breaks down along the

 

25   way in any way, shape, or form, or - or whatever, we will advise

 

                                                           598

 

 1   counsel on Monday.  And then the hearing can go forward.

 

 2             Mr. Hibbard has asked me that in the event that the

 

 3   hearing does go forward, would I be good enough to give him a

 

 4   supplemental brief beyond the brief that we've already filed

 

 5   identifying these issues that relate to his client in terms of

 

 6   the joint tenancy.  And my answer to that is with Your Honor's

 

 7   consent I will do that.  And I don't believe I have the right to

 

 8   file an additional brief, but I don't have any problem doing -

 

 9   accommodating Mr. Hibbard's request.

 

10             And if - if that - if what I've just described to you

 

11   is consistent with Mr. Hibbard's understanding of the

 

12   arrangement, and Mr. Zlotoff's - I have purposely not got into

 

13   the details.  I don't think it's appropriate to put on the

 

14   record the details of what we have agreed to or tentatively

 

15   agreed to or I've said, "It sounds okay to me, I'll - you know,

 

16   I'll discuss with my client," - if that's the case then all we

 

17   have left now is to continue to cross on non- - of Ms. Lucas on

 

18   nonjoint tenancy issues for purposes of this proceeding.

 

19             MR. HIBBARD:  There are only two small issues, Your

 

20   Honor.  Basically all we're doing is going to hire a realtor,

 

21   let them list it for 60 days.  If they can get a better price,

 

22   then - then fine, it goes to them.  If it doesn't, it goes to

 

23   either their buyer or my client's buyer.

 

24             And that would have to come back and get confirmed by

 

25   you of course.  That's the fundamentals of the deal.

 

                                                           599

 

 1             Also we're going to request, and I could just see the

 

 2   look in your eye, Your Honor, that if my client needs a living

 

 3   allowance, that she make an application to withdraw at least

 

 4   from one of - from her proceeds, which she'll need to survive.

 

 5   but those are the only two issues that we're really - we're

 

 6   really dealing with.

 

 7             Is the Court amenable to that?

 

 8             THE COURT:  Well, Mr. Zlotoff, do you agree to all

 

 9   this?  And you need to be at a microphone.

 

10             MR. ZLOTOFF:  Yeah.  It all sounds fine to me.  Just

 

11   one little housekeeping matter, is I had a response due Friday,

 

12   and -

 

13             THE COURT:  On what?

 

14             MR. ZLOTOFF:  On - for the October 10th hearing.  And

 

15   if - if it's possible it's going to be resolved, I'd just as

 

16   soon not have to file it on October -

 

17             MR. ROSEN:  Well, I've - I've undertaken, Your Honor,

 

18   as I just said, to advise counsel on Monday if we have an

 

19   agreement or not.  And if Your Honor can tolerate Mr. Zlotoff

 

20   waiting until Tuesday morning to file his reply brief, I can

 

21   certainly do that.

 

22             THE COURT:  Well, if he's not going to know until

 

23   Monday close of business what your position is, then filing it

 

24   Tuesday first thing in the morning is a little onerous.

 

25             MR. ROSEN:  Well, except -

 

                                                           600

 

 1             THE COURT:  But you can - you can file - if you file

 

 2   your reply brief by the end of the day Tuesday, that'll be fine

 

 3   for me.  And you should know by Monday, but I don't know what

 

 4   your other schedule is, you know, what else you've got.  But the

 

 5   end of the day, you get it to me, and you don't even have to

 

 6   file it.  If you fax it to chambers and file it the next day and

 

 7   fax it to the other side, or both of these parties, then that'll

 

 8   be fine, too.  It's just a matter of physically receiving it.

 

 9             MR. ZLOTOFF:  I understand.  Thank you.  I appreciate

 

10   that.

 

11             MR. HIBBARD:  And also, Your Honor, I need to know, to

 

12   have a date set for me to receive his brief on the specific

 

13   issues of the joint tenancy ownership and my time to respond.

 

14             But if you have it to me by -

 

15             THE COURT:  I have to hold this back a second.  I

 

16   don't think - first of all, I'm not sure that I can decide the

 

17   joint tenancy issue in the context of a motion to sell free and

 

18   clear.

 

19             What normally happens is that you're sold free and

 

20   clear and normally - I haven't researched this in the context

 

21   that this is coming up, but normally the right, title, and

 

22   interest in real property is solved by adversary proceeding.

 

23             So whether this can all play out to be resolved on

 

24   Thursday, the 10th, is dubious.

 

25             MR. ROSEN:  Your Honor, your comments I think reflect

 

                                                           601

 

 1   the comment I made a moment ago.  The motion that is before you,

 

 2   if it were necessary to go to a decision, that the motion is

 

 3   returnable on the 10th, is for an order allowing the sale of the

 

 4   house.

 

 5             Whether or not we agree to a listing or whether it's a

 

 6   contested motion Your Honor has to decide, the issue of joint -

 

 7   of Ms. Lucas' interest only comes up on the occasion of now the

 

 8   house has been sold, and the question is the distribution of the

 

 9   proceeds.

 

10             THE COURT:  Well, normally if - if there's a - whether

 

11   you would then have to file - you might have to file a request

 

12   for an injunction if - because there's been no - there's been no

 

13   objection to the proceeds being distributed as far as I'm

 

14   aware -

 

15             MR. ROSEN:  Yeah, there is.  I'm pretty sure our

 

16   opposing papers do object to it and ask for an escrow.

 

17             THE COURT:  Okay.  Well, I don't -

 

18             MR. ROSEN:  But -

 

19             THE COURT:  I'm not ruling on any of this.  The

 

20   concern I have only is if I start getting briefs on the 8th and

 

21   the 9th for a hearing on the 10th, on which I'll have 30 or 40

 

22   other matters probably, and you're briefing joint tenancy and

 

23   you're putting in facts in your brief, the idea that I'm going

 

24   to resolve this Thursday seems unlikely.

 

25             MR. HIBBARD:  Well, of course, Your Honor.  Actually

 

                                                           602

 

 1   what I thought we would set up - the Court is correct, it should

 

 2   be a separate adversary action.

 

 3             THE COURT:  Right.

 

 4             MR. HIBBARD:  As a way to get my client more of the

 

 5   proceeds, we just may be would agree to waive all - all those

 

 6   proceedings.  And maybe on the 10th, if we do have an agreement,

 

 7   put the agreement on the calendar for the 10th.  And then once

 

 8   you have an agreement, then maybe set another date just for the

 

 9   joint tenancy issues or distribution of the proceeds.

 

10             THE COURT:  Yeah.  That's fine.  That's no problem.

 

11             MR. ROSEN:  Yeah, that makes sense, Judge.

 

12             THE COURT:  That's no problem.  But we still don't

 

13   have a brief.  So if you want a brief by Mr. Rosen before the

 

14   10th and you and he have to agree, I'm just not promising to

 

15   resolve the issue on the 10th.  I don't think that's realistic.

 

16             MR. HIBBARD:  No, -

 

17             MR. ROSEN:  I think that what Your Honor just said and

 

18   what Mr. Hibbard just said abates the need for that, because Mr.

 

19   Hibbard's concern, if I understand correctly, to me was he

 

20   wanted to brief on the joint tenancy issues if they were being

 

21   heard and determined on the 10th.

 

22             If, as he's now suggested, and I think it's a good

 

23   suggestion, that that - that that issue will be determined at

 

24   some point after the 10th, then I will certainly give him a

 

25   brief, you know, when we figure out where that issue - when that

 

                                                           603

 

 1   issue's going to be tried and when Your Honor sets the schedule

 

 2   for briefing.

 

 3             So, if I understand correctly, if I may ask Mr.

 

 4   Hibbard through Your Honor, if it's agreed that the issue of

 

 5   joint tenancy will not be presented to the Court on the motion

 

 6   that's returnable on the 10th, assuming we don't have an

 

 7   agreement to abate that motion, that it will be some other time.

 

 8   Do I understand that Mr. Hibbard can do without our having a

 

 9   brief on joint tenancy next week?

 

10             MR. HIBBARD:  Yes.  That's correct as far as I'm

 

11   concerned.

 

12             THE REPORTER:  Excuse me.  If you could keep back a

 

13   little from the microphone.

 

14             MR. HIBBARD:  Okay.  Sorry.

 

15             Yes.  That's - that's fine as far as I'm concerned.

 

16             THE COURT:  Okay.  So as of this point the motion for

 

17   sale free and clear of liens is on for the 10th.  And you agree

 

18   that if there is an objection to the distribution of Ms. Lucas'

 

19   joint tenancy share, then that money will be escrowed

 

20   temporarily pending further proceedings in the court?

 

21             MR. HIBBARD:  That's correct, Your Honor.

 

22             THE COURT:  Okay.  And you're appearing specially for

 

23   her today?

 

24             MR. HIBBARD:  That's correct.

 

25             THE COURT:  Okay.  That's fine.

 

                                                           604

 

 1             MR. ROSEN:  Your Honor, with that I think I would

 

 2   like -

 

 3             THE COURT:  Now, Mr. Hibbard, I just have to say

 

 4   something to you.  Mr. Rosen has been saying that - and I - I

 

 5   haven't analyzed the issue.  He's been saying basically that the

 

 6   type of marriage that Mr. and Mrs. Henson had relates somehow to

 

 7   - and her joint tenancy interest.  And he's been asking

 

 8   questions throughout the proceeding about the type of marriage.

 

 9   He was just about - he asked her - he started to ask her

 

10   questions about where she's been living, whether she has two

 

11   residences or one residence and when, and all of that.

 

12             It's my understanding pursuant to your agreement that

 

13   there aren't going to be any such questions anymore -

 

14             MR. ROSEN:  That's correct, Your Honor.

 

15             And I - if I may just beg to differ with you, the

 

16   questions about her residence do relate, and Your Honor

 

17   instructed no answer on where she's living and whether - where

 

18   her residence is at the moment.

 

19             But the question on the communications with her

 

20   husband and what kind of marriage she has don't relate to the

 

21   joint tenancy issue at all.

 

22             THE COURT:  Okay.

 

23             MR. ROSEN:  They are cross-examination respecting her

 

24   direct testimony as to her knowledge of her husband's affairs,

 

25   his earnings, expenses, et cetera.  They have no relationship in

 

                                                           605

 

 1   my mind to joint tenancy issues.

 

 2             THE COURT:  Okay.  That's fine.  Thank you for that

 

 3   clarification.

 

 4             MR. HIBBARD:  Thank you, Your Honor.

 

 5             THE COURT:  Thank you, Mr. Hibbard.

 

 6             Now, Ms. Lucas, if you would retake the stand, please.

 

 7   VICTORIA AREL LUCAS, DEBTOR'S WITNESS, PREVIOUSLY SWORN

 

 8             THE COURT:  Good afternoon.

 

 9             You may proceed.

 

10             MR. ROSEN:  Thank you, Your Honor.

 

11                  CROSS-EXAMINATION, resumed

 

12   BY MR. ROSEN:

 

13   Q.  Ms. Lucas, you testified I believe in response to Mr.

 

14   Zlotoff's questions that there came a point in time at which a

 

15   subpoena was served on you to produce documents and appear for

 

16   an examination in this case.  I think that's one you said was

 

17   left on your property and you didn't want to touch it or

 

18   something; am I remembering that correctly?

 

19   A.  There was one like that.

 

20   Q.  Yeah.  And you were - and that subpoena related to the

 

21   examination that was conduct of you of December 17th, 1998.  It

 

22   asked for cer- - for you to produce certain documents?

 

23   A.  I remember one like that.

 

24   Q.  Okay.  And, Ms. Lucas, is it correct that in preparation for

 

25   that deposition - that examination -

 

                                                           606

 

 1             MR. ROSEN:  I'm sorry, Your Honor.  I keep saying -

 

 2   when I see a transcript, it's a deposition.

 

 3   BY MR. ROSEN:

 

 4   Q.  - to that examination, you went over the list of documents

 

 5   with your husband and he directed you which documents not to

 

 6   produce; is that right?

 

 7   A.  I don't remember whether we went over every specific

 

 8   document.

 

 9   Q.  Did you go over the list of the documents, meaning the

 

10   subpoena, and - and discuss with your husband whether or not you

 

11   were going to produce - you should produce any of them?

 

12   A.  I think we tried to find them and discuss what they were and

 

13   what the significance of them - of them was.

 

14   Q.  Did your husband tell you at any time that these are joint

 

15   documents and that he refuses to consent to allow you to produce

 

16   them, or words to that effect?

 

17   A.  I remember it for one of the examinations that there were

 

18   some documents and I felt that it was not wholly my

 

19   responsibility to give them up since they didn't wholly belong

 

20   to me.

 

21   Q.  And because of your belief you then asked your husband if it

 

22   was okay if you produce them?

 

23   A.  Yes.

 

24   Q.  And he said no?

 

25   A.  Yes.

 

                                                           607

 

 1   Q.  And you then appeared at the deposition - excuse me - at the

 

 2   examination on December 17th, 1998 and you testified, ma'am,

 

 3   that there were documents that were responsive to the subpoena

 

 4   which you did not produce because your husband told you not to,

 

 5   right?

 

 6   A.  I'm not sure if those were the words I used.

 

 7   Q.  Well, no.  I'm not talking about - I'm not putting the words

 

 8   in quotes, ma'am.  I'm talking about in substance.  Is that the

 

 9   substance of the testimony you gave, that you discussed -

 

10             MR. HIBBARD:  Your Honor, I'm going to have to object.

 

11   If he wants to question her about the hearing, he can show her

 

12   and ask her if it refreshes her recollection on what she said or

 

13   didn't say.  This is improper.

 

14             THE COURT:  Sustained.

 

15   BY MR. ROSEN:

 

16   Q.  Is it a fact that you refused to produce documents on the

 

17   grounds that your husband told you not to?

 

18   A.  I believe so.

 

19   Q.  Okay.  Ms. Lucas, do you - are you aware that your husband

 

20   owned stock in a company called Xanadu, X-a-n-a-d-u,

 

21   Corporation, by the name of Xanadu Operating Company?

 

22             THE COURT:  Did you say "owns" or "owned"?

 

23             MR. ROSEN:  "Owned."

 

24             THE COURT:  When?

 

25             MR. ROSEN:  As of August of 1998 - as of 1998,

 

                                                           608

 

 1   throughout the year.

 

 2             THE WITNESS:  I believe that he owned some stock in

 

 3   that company at some point, I don't know when.

 

 4   BY MR. ROSEN:

 

 5   Q.  When did you first learn that he owned stock in that

 

 6   company, ma'am?

 

 7   A.  I don't remember.

 

 8   Q.  Did you know that in the - at the time - in 1998, that he

 

 9   owned stock or were you told about it afterwards in preparation

 

10   for your testimony here?

 

11   A.  Sounds like a "beating your wife" question.  I don't

 

12   remember - I know that he was involved in the company as a

 

13   consultant, as an unpaid consultant, but as to whether he owned

 

14   stock in it, I'm still not sure.

 

15   Q.  Okay.  And you - is it correct then that - that you would

 

16   not know because the stock - any company that he owned stock in

 

17   was his affair, his private affair?

 

18   A.  No, just because I'm not involved.

 

19   Q.  Is it correct that in your relationship with your husband at

 

20   least during the year 1998 that your husband would not tell you

 

21   what company he owned stock in because - and you - and you

 

22   understood that because you considered to be his affair, not

 

23   your affair?

 

24   A.  For the most part, if I didn't ask him things, it was

 

25   because I didn't want to know.

 

                                                           609

 

 1   Q.  I - I'm not sure that answers my question.

 

 2             Is the reason that you didn't want to know because you

 

 3   considered any stock ownership he had to be his affair, and not

 

 4   yours or "ours" affair?

 

 5   A.  Partly.

 

 6   Q.  Ma'am, as you sit here today do you know if during the year

 

 7   1998 your husband owned any bonds or other securities?

 

 8   A.  As far as I know, he did not.

 

 9   Q.  And when did you first learn that he did not?

 

10   A.  I don't remember.

 

11   Q.  Did you - did you know in the year 1998 whether he did or

 

12   did not own any bonds or other securities?

 

13   A.  I don't remember.

 

14   Q.  Let me see if I can refresh your recollection.  I read from

 

15   page 24 of the same dep- - examination of December 17th, 1998.

 

16             THE COURT:  Which none of us have, by the way, Mr.

 

17   Hibbard.

 

18             MR. HIBBARD:  No, it -

 

19             THE COURT:  Neither the Court, nor the witness, none

 

20   of us have this.

 

21             MR. ROSEN:  Oh, you - I told you I was going to give

 

22   you a copy.

 

23             THE COURT:  Yeah.  But I can't follow along, so I have

 

24   no idea whether what you're reading is accurate.

 

25             MR. HIBBARD:  Well, Your Honor, with that statement,

 

                                                           610

 

 1   but if that's the case, then perhaps counsel should approach the

 

 2   witness and show her the passage.

 

 3             THE COURT:  I suggested that; he absolutely refused.

 

 4             MR. HIBBARD:  Well, if he refuses then I'm going to

 

 5   object to the whole line of questioning.

 

 6             THE COURT:  And I would sustain it.

 

 7             MR. ROSEN:  I was going to read her something to see

 

 8   if it refreshes her recollection.

 

 9             MR. HIBBARD:  Well, then -

 

10             MR. ROSEN:  Do I have to show her something to refresh

 

11   her recollection or can I ask her anything to refresh her

 

12   recollection?  Her answer is she doesn't remember.

 

13             THE COURT:  You can ask her anything to refresh her

 

14   recollection.

 

15             MR. ROSEN:  Thank you.

 

16             THE COURT:  But whether it's an accurate

 

17   representation of what's written there, nobody knows.

 

18             MR. ROSEN:  Thank you.  Except that I'm an officer of

 

19   the court.

 

20             THE COURT:  Except that you can make mistakes in

 

21   reading, just like everybody else.

 

22   BY MR. ROSEN:

 

23   Q.  Okay.  Let me see if this refreshes your recollection.  Do

 

24   you recall these questions and answers being asked of you on

 

25   December 17th, 1998, page 24, starting at line 1.

 

                                                           611

 

 1             "Do you know if he owned" - "he" meaning your husband

 

 2   - "owns any bonds or other securities?

 

 3             "ANSWER:  I don't know."

 

 4             Does that refresh your recollection as to whether in

 

 5   the year 1998 you knew if your husband owned any bonds or other

 

 6   securities?

 

 7   A.  No.

 

 8   Q.  Okay.  Did you know whether in the year 1998 your husband

 

 9   owned any mortgages or deeds of trust?

 

10   A.  Owned - owned somebody else's mortgage or somebody else's

 

11   deed of trust?

 

12   Q.  Correct.  In other words, that he - he was the holder of the

 

13   - of the interest.

 

14   A.  I don't believe that he did.  I don't know what I knew then.

 

15   Q.  Okay.  And is the reason that you didn't know because it was

 

16   not the practice for you to have knowledge of your husband's

 

17   affairs?

 

18   A.  It -

 

19   Q.  Again, I'm talking about 1998.

 

20   A.  It was not his practice to have mortgages or deeds of trust

 

21   belonging to other people.

 

22   Q.  No.  That's not my question.  Was it the practice between

 

23   the two of you in 1998 that your husband would or would not tell

 

24   you of things that he owned?

 

25   A.  He would tell me about some things that he owned and not

 

                                                           612

 

 1   about others.

 

 2   Q.  Okay.  Do you know as you're sitting here today, ma'am, if

 

 3   your husband owned - held any interest in promissory notes?  In

 

 4   other words, if he had made a loan to somebody and they had

 

 5   given him a note or in drafts or checks, or any commercial

 

 6   instruments, bills of exchange or any other commercial

 

 7   instruments?

 

 8             Do you know as you sit here today whether your husband

 

 9   owned any of those things in 1998?

 

10   A.  No.

 

11   Q.  Do you know as you sit here today whether in 1998 your

 

12   husband held any liens or any security interests respecting

 

13   personal property?

 

14   A.  I don't believe that he did.

 

15   Q.  Okay.  Did you know - do you know whether he does or

 

16   doesn't?

 

17             THE COURT:  I don't understand the question.  Do you

 

18   know now whether he does now?

 

19             MR. ROSEN:  I'm asking her as she sits here now does

 

20   she know, yes or no, whether he owned any of these things in

 

21   1998.

 

22             THE WITNESS:  I can't be sure.

 

23   BY MR. ROSEN:

 

24   Q.  Okay.  Do you know as you sit here now whether in the year

 

25   1998 your husband held any judgment against anybody who owned

 

                                                           613

 

 1   him money?

 

 2   A.  I'm pretty sure he didn't.

 

 3   Q.  Did you know in 1998 whether he did?

 

 4   A.  I think I felt sure that he didn't.

 

 5   Q.  Let me see if I can - you said you think.  Let me see if I

 

 6   can refresh your recollection.  Page 24, line 22:

 

 7             "QUESTION:  Do you know if he owns any judgments that

 

 8   will allow him to collect money?

 

 9             "ANSWER:  That is his affair."

 

10             Does that refresh your recollection as whether - as to

 

11   whether you knew in 1998 if he - if he had any judgments that he

 

12   held for debts owing by others?

 

13   A.  Not really.

 

14   Q.  It doesn't - doesn't refresh your memory at all?

 

15             Is that right?

 

16   A.  No.

 

17   Q.  Okay.  Do you know today, ma'am, what clients or contracts,

 

18   arrangements your husband had to perform services for other

 

19   people in the year 1998?

 

20             I'm talking about his professional occupation as a

 

21   computer expert.

 

22   A.  I don't know to what extent he had contracts or informal

 

23   arrangements or what kinds of business arrangements he may have

 

24   had with people.

 

25   Q.  Do you know now as you sit here whether your husband had any

 

                                                           614

 

 1   contracts or any arrangements with clients to perform work for

 

 2   them in 1998?

 

 3   A.  I think that during the year he had a couple.

 

 4   Q.  You think that as you say - as you sit here today?

 

 5             Okay.  Did you know in 1998 whether he had any

 

 6   contracts or arrangements to perform work for anybody?

 

 7   A.  It seems to me that during August he wasn't working at all.

 

 8   Q.  Yeah.  But my question is 1998, ma'am.  It's got 12 months

 

 9   in the year.  So I'll repeat the question.

 

10             Did you know at any time in 1998 whether your husband

 

11   had any contracts, any arrangements to perform work for anyone?

 

12   A.  I think he may have had some time during that year -

 

13   Q.  Okay.

 

14   A.  - arrangements to work for a couple of different companies.

 

15   Q.  Okay.  Let me - since your - you have a reservation in your

 

16   answer of you think so, let me see if this refreshes your

 

17   recollection.  The bottom of page 24, line 20- - starting at

 

18   line 25:

 

19             "QUESTION:  Do you know if Mr. Henson has any

 

20   contracts with anyone to perform any work?

 

21             "ANSWER:  I don't know."

 

22             Does that help refresh your memory?

 

23   A.  No.

 

24   Q.  Ms. Lucas, as you sit here today do you know if Mr. Henson

 

25   has a will?

 

                                                           615

 

 1   A.  I believe he does.

 

 2   Q.  And do you know as you sit here today whether you are named

 

 3   in that will?

 

 4             MR. HIBBARD:  Objection, Your Honor.  It's completely

 

 5   irrelevant these proceedings, the testimony - her testimony -

 

 6             THE COURT:  Whether she's named in his will.  Why is

 

 7   that relevant?

 

 8             MR. ROSEN:  This goes to the whole - this witness has

 

 9   testified over our objections on direct as to her knowledge of

 

10   her husband's affairs.  I've told you from the beginning this

 

11   marriage is not one that Your Honor apparently assumed to be

 

12   like marriages you may be familiar with.  I've told you these

 

13   people lived separate existences.

 

14             And it would certainly support that proposition and

 

15   would undercut all of her direct testimony if, for example, she

 

16   doesn't even know if her husband has named her in a will.

 

17             MR. HIBBARD:  That's absurd.  Please.  What - whether

 

18   it's named - whether she's named in the will or not is

 

19   completely irrelevant to what their relationship is.

 

20             MR. ROSEN:  The issue is not whether she's named in

 

21   the will.  The issue is whether she knows, because every husband

 

22   and wife I would know would certainly know what the other one -

 

23   you know, if they're named in their - in their spouse's will.

 

24             THE COURT:  So you don't want to know whether - what -

 

25   whether she's named or not.  You just want to know whether she

 

                                                           616

 

 1   knows?

 

 2             MR. ROSEN:  Correct.

 

 3             THE COURT:  Okay.  So that's the question, whether she

 

 4   knows, not -

 

 5             MR. ROSEN:  Right.

 

 6             THE COURT:  - not whether - not whether she is, in

 

 7   fact, named in the will.

 

 8             MR. ROSEN:  Correct.

 

 9             THE COURT:  Any objection?

 

10             MR. HIBBARD:  Your Honor, I still think it's

 

11   confidential information one way or the other, but -

 

12             THE COURT:  Whether she knows.

 

13             MR. HIBBARD:  Whether she knows.

 

14             THE COURT:  Is confidential?

 

15             MR. HIBBARD:  Yes.

 

16             THE COURT:  Overruled.

 

17             You can state whether you know whether you're named in

 

18   his will, but not whether in fact you're named in his will.  Do

 

19   you understand the difference?

 

20             THE WITNESS:  Yes.

 

21             THE COURT:  You understand the difference?

 

22             THE WITNESS:  It's - it's what I believe versus what

 

23   may be fact.

 

24             THE COURT:  No.

 

25             THE WITNESS:  Oh, sorry.

 

                                                           617

 

 1             MR. ROSEN:  Let me try the question.

 

 2             THE COURT:  No.  Let me - let me state this because I

 

 3   want to make sure she understands it.

 

 4             I'm not asking you whether you really are named in the

 

 5   will.  I'm asking whether you know whether you're named in the

 

 6   will.

 

 7             THE WITNESS:  Oh.

 

 8   BY MR. ROSEN:

 

 9   Q.  You can answer that yes or no.

 

10             THE COURT:  And that's what Mr. Rosen's question is.

 

11             In other words, you could know whether or not you're

 

12   named in the will, not - but you don't have to disclose whether

 

13   or not you're named in any will.

 

14             THE WITNESS:  Okay.

 

15             THE COURT:  There may not even be a will.

 

16             MR. HIBBARD:  And that's my point exactly -

 

17             THE COURT:  Well, then there's -

 

18             MR. ROSEN:  Well, she already testified it was.

 

19             THE COURT:  In what year?

 

20             MR. ROSEN:  1998.

 

21             THE WITNESS:  Yes.

 

22             THE COURT:  You know?

 

23             THE WITNESS:  Yes.

 

24             THE COURT:  Thank you.

 

25             MR. ROSEN:  Page 25.  I'm now at the point of offering

 

                                                           618

 

 1   - I've been asking questions from this this afternoon for

 

 2   purposes of refreshing recollection.  I'm now going to offer

 

 3   portions of this examination, December 17th, 1998, as evidence

 

 4   for purposes of impeaching this witness' testimony.

 

 5             And for that purpose I will do what Your Honor asked.

 

 6   I am handing up two copies of what we've marked as plaintiff's

 

 7   [sic] Exhibit 291.  And I would point out that these are all the

 

 8   excerpts, many of them I haven't even gotten to yet -

 

 9             THE COURT:  Could you get to the microphone?

 

10             MR. ROSEN:  Yeah.

 

11             THE COURT:  Do you want to see this, Mr. Hibbard?

 

12   I'll let you see them.  Go -

 

13             MR. HIBBARD:  Thank you, Your Honor.

 

14             THE COURT:  My copy.

 

15             MR. HIBBARD:  I also think that unless it's certified

 

16   it's not going to come into evidence.

 

17             THE COURT:  It's a 2004 that was - should be in this

 

18   court's file.  That's the problem with it.  And we have to -

 

19   I've just given my Deputy a note.

 

20             MR. ROSEN:  Your Honor, may we not show it to the

 

21   witness?  This is impeachment -

 

22             THE COURT:  Yeah.  Counsel - counsel is looking at it

 

23   now.

 

24             MR. HIBBARD:  Well, I've possibly got some issues, but

 

25   I'm going to object to this, that this entire testimony the way

 

                                                           619

 

 1   this was, because if counsel has copies of this, he hasn't

 

 2   followed the correct procedures in impeaching someone -

 

 3   someone's testimony.  The copy should have been offered to me

 

 4   and to the witness.  He didn't ask -

 

 5             THE COURT:  You didn't exist until a few minutes ago.

 

 6             MR. HIBBARD:  I understand that, Your Honor, but I

 

 7   still have to raise the objection that this entire testimony is

 

 8   improper and it all should be thrown out.  Particularly if he

 

 9   hasn't presented copies to everyone during the process.

 

10             THE COURT:  He hasn't.

 

11             MR. HIBBARD:  Then I respectfully submit that the

 

12   whole thing is objectionable as improper testimony, improper

 

13   examination.

 

14             MR. ROSEN:  I'd like some clarification.  I thought

 

15   counsel was appearing specially on the issue of Ms. Henson's

 

16   interests in - excuse me - Ms. Lucas' interest in the joint

 

17   tenancy.  Is he now appearing as counsel for Ms. Lucas for all

 

18   purposes in this hearing?

 

19             MR. HIBBARD:  Yes, -

 

20             THE COURT:  Well, he can appear specially for all

 

21   purposes.

 

22             MR. HIBBARD:  Yes.

 

23             MR. ROSEN:  I don't believe the Federal Rules

 

24   recognize such a special appearance, Your Honor.  If you could

 

25   point me to a section of the Federal Rules of Civil Procedure

 

                                                           620

 

 1   that do, I would greatly appreciate it.

 

 2             MR. HIBBARD:  Well, interestingly enough, Your Honor,

 

 3   that's not your burden, that's his burden to bring it up.  If

 

 4   he's got one, let him show the rule.

 

 5             THE COURT:  Yeah.  And I have no problem with your

 

 6   appearing specially for all purposes for Ms. Lucas today.

 

 7             MR. HIBBARD:  Thank you, Your Honor.

 

 8             THE COURT:  Given that you just received notice of

 

 9   this a few minutes ago.

 

10   BY MR. ROSEN:

 

11   Q.  Page 25, lines 4 and 5.  Ms. Lucas, do you recall being

 

12   asked the following question and giving the following answer

 

13   under oath:

 

14             "QUESTION:  Are you the beneficiary of his will?

 

15             "ANSWER:  I don't know."

 

16             Do you recall giving that answer?

 

17   A.  Not specifically.

 

18   Q.  Do you deny it?

 

19   A.  No.

 

20   Q.  Was the answer true at the time you gave it?

 

21   A.  Yes.

 

22   Q.  Ms. Lucas, by the way, you indicated earlier in response to

 

23   a question that you don't remember taking an oath when you were

 

24   examined in December - on December 17th, 1998.

 

25             MR. ROSEN:  Your Honor, may I approach the witness and

 

                                                           621

 

 1   show her page 4 to see if that refreshes her recollection?

 

 2             THE COURT:  You can give it to my Deputy.

 

 3             MR. ROSEN:  Well, I think you've got the extra copy

 

 4   there.

 

 5             THE COURT:  Page 4?

 

 6             MR. ROSEN:  Yes.

 

 7             THE COURT:  Of?

 

 8             MR. ROSEN:  Page 4 of the exhibit, Your Honor.  I'm

 

 9   sorry.  It bears a number "4" at the bottom.

 

10   BY MR. ROSEN:

 

11   Q.  Do you see that, Ms. Lucas?

 

12   A.  Yes.

 

13   Q.  Does that refresh your recollection -

 

14             THE COURT:  I don't see it.  Wait a second, Mr. Rosen.

 

15             Oh, this is related to the oath.

 

16   BY MR. ROSEN:

 

17   Q.  Having looked at page 4, Ms. Lucas, does that refresh your

 

18   recollection as to whether the testimony you gave on December

 

19   17th, 1998 was under oath?

 

20   A.  Yes.

 

21   Q.  You now recall that you did affirm as opposed to swear to

 

22   provide truthful testimony, right?  The whole truth, and nothing

 

23   but the truth, right?

 

24   A.  Yes.

 

25   Q.  And did you do that, Ms. Lucas?

 

                                                           622

 

 1   A.  I tried to tell the whole truth.

 

 2   Q.  Okay. 

 

 3   A.  I was prevented in many instances.

 

 4   Q.  You - you didn't purposely say anything in here, to your

 

 5   knowledge, that was untrue, did you?

 

 6   A.  I may have misspoken, but I didn't purposely saying anything

 

 7   untrue.

 

 8   Q.  Okay.  Ms. Lucas, do you know today if your husband owned

 

 9   any - had any brokerage accounts, stock brokerage accounts in

 

10   the year 1998?

 

11             You can just answer yes or no.

 

12             THE COURT:  Do you know today whether he owned in

 

13   1998 -

 

14             MR. ROSEN:  Correct.

 

15             THE COURT:  That's the question.

 

16             MR. ROSEN:  That the question.

 

17             THE WITNESS:  I can't really answer it yes or no

 

18   because I don't know the - I don't know what you would call his

 

19   IRA account.  Other than that he held bro- - accounts that might

 

20   be -

 

21   BY MR. ROSEN:

 

22   Q.  I can't hear you.

 

23   A.  I can't - I don't know what his IRA account is.  I - or what

 

24   the status of it is - was at that time.  I don't know if it

 

25   would count as a brokerage account.  Other than that, he - he

 

                                                           623

 

 1   did not have one to my knowledge at this time.

 

 2   Q.  And did you know in 1998 that he did not - did you know then

 

 3   that he did not have a brokerage account other than possibly an

 

 4   IRA?

 

 5   A.  I don't think I did.

 

 6   Q.  So you learned about it after 1998, right?

 

 7   A.  Yes.

 

 8   Q.  Now his IRA, as long as you mentioned it, who was the

 

 9   depository on the IRA?  In other words, who held the funds?

 

10   A.  I think it's been the same people, at this point I believe

 

11   it's Charles Schwab.

 

12   Q.  Okay.  And that was true in 1998?

 

13   A.  I think so.

 

14   Q.  Okay. 

 

15             MR. HIBBARD:  Your Honor, I'm also going to raise an

 

16   objection.  This is the best evidence - what we're having here

 

17   is a memory test.  If we have this, why doesn't he just submit

 

18   the transcript in support of his motion?  I don't understand why

 

19   we're going over it - why we're reviewing a memory test.  I

 

20   couldn't remember what I testified to in 1998.  I mean this is -

 

21   this is absurd.

 

22             MR. ROSEN:  Counsel is misunderstanding, Your Honor.

 

23   It's not a memory test.  I'm reading only for purposes of either

 

24   refreshes the witness' recollection as she answers that she

 

25   doesn't remember or she thinks, or to impeach her if she

 

                                                           624

 

 1   provides an answer which is different than that.

 

 2             The issue is not what she testified to in 1998 per se.

 

 3   The issue is the 1998 testimony becomes relevant for either of

 

 4   those two reasons, either refresh her recollection if she

 

 5   doesn't remember or to impeach her based on testimony she's

 

 6   given here in the courtroom.

 

 7             MR. HIBBARD:  Well, then I would request an offer of

 

 8   proof of why this witness is on the stand at all.

 

 9             THE COURT:  She was offered by Mr. Henson, her

 

10   husband.  She wasn't offered by Mr. Rosen.

 

11             MR. HIBBARD:  True, but we still have her previous

 

12   testimony of 1998 which can be substantially more in line with

 

13   the two to the time then putting her on a memory test right now.

 

14             THE COURT:  Except that Mr. Zlotoff asked many of

 

15   these same questions or types of questions, as I recall.  He

 

16   could correct me if I'm wrong, and so now Mr. Rosen is entitled

 

17   to cross.

 

18             MR. HIBBARD:  All right.

 

19             MR. ROSEN:  That's a - Your Honor, I thank you for the

 

20   ruling.  You might also point out, if I might respectfully -

 

21             THE COURT:  Mr. Rosen, you don't have to do -

 

22             MR. ROSEN:  - suggest, they could withdraw the

 

23   witness -

 

24             THE COURT:  - rulings for me.  Please just ask her

 

25   questions.

 

                                                           625

 

 1             MR. ROSEN:  No.  I said they cannot certainly withdraw

 

 2   the witness.

 

 3             THE COURT:  Yeah, thanks, Mr. Rosen.  Just answer -

 

 4   ask the questions.

 

 5   BY MR. ROSEN:

 

 6   Q.  Ms. Lucas, do you know now as to how much income your

 

 7   husband earned in the year 1998?

 

 8             You could just say yes or no.

 

 9   A.  I'm not sure that I remember a correct figure.

 

10   Q.  Okay.  Do you - did you know in 1998 how much your husband

 

11   earned in that year?

 

12   A.  I don't remember.

 

13   Q.  Did you - let me see if I can help refresh your

 

14   recollection.  Page 41, line 14:

 

15             "QUESTION:  All right.  Talking about this year only"

 

16   - and that is obviously 1998 - "how much income has your husband

 

17   made as an independent contractor?

 

18             "ANSWER:  I do not know."

 

19             Does that help refresh your recollection?

 

20             MR. HIBBARD:  Well, I'm going to object to this

 

21   because there's no point in refreshing her recollection.  She

 

22   gave the same answer.

 

23             THE COURT:  Anything can refresh her recollection.

 

24   The problem is - a dog bone could refresh your recollection.  So

 

25   the - the objection is overruled.

 

                                                           626

 

 1             MR. HIBBARD:  Thank you, Your Honor.

 

 2   BY MR. ROSEN:

 

 3   Q.  Does that refresh your recollection, ma'am?

 

 4   A.  The question is reflects - refresh my intel- - my

 

 5   recollection of what?  Making the testimony?

 

 6   Q.  No, ma'am.  Does it refresh your recollection on the subject

 

 7   of whether you knew in 1998 how much your husband had earned in

 

 8   1998.  Whether you knew on December 17th, 1998 how much your

 

 9   husband had earned in that year?

 

10   A.  I don't think I knew at that point.

 

11   Q.  Okay.  At - at that point in time, did you have any concept

 

12   of the magnitude of what Mr. Henson had earned, even a range?

 

13             THE COURT:  For that year?

 

14             MR. ROSEN:  For that year.

 

15             THE COURT:  At that time.  So we're talking about -

 

16   because you can't know what he earned in '98 until we're at the

 

17   end of '98.

 

18             MR. ROSEN:  No.  Up to December 17th, because that's

 

19   the date of this deposition - the examination.

 

20             THE COURT:  The 2004.

 

21             MR. ROSEN:  Yeah.  I'm sorry, Your Honor.  I keep

 

22   forgetting it.

 

23             THE WITNESS:  All I remember knowing is that he made

 

24   so little that I had to go out and get three jobs -

 

25   BY MR. ROSEN:

 

                                                           627

 

 1   Q.  Three jobs or four jobs, ma'am?

 

 2   A.  Three and - and - I think it was three and then I did some

 

 3   volunteering to try to build up my credentials.

 

 4   Q.  So in the year 1998 you worked three jobs at the same time?

 

 5   A.  Yes.

 

 6   Q.  But you didn't work four jobs?

 

 7   A.  I'd have to cast my mind back to exactly who I worked for -

 

 8             THE COURT:  The job paid or unpaid, Mr. Rosen?

 

 9             MR. ROSEN:  A job is paid.  Volunteer work is not a

 

10   job.

 

11             THE COURT:  Well, I don't know whether that's true,

 

12   Mr. Rosen.  A job - a volunteer job may be - may be a job just

 

13   like any other job.

 

14             MR. ROSEN:  Thank you, Your Honor.  I was going by the

 

15   dictionary definition.

 

16             THE COURT:  I'm sure you have it memorized, Mr. Rosen,

 

17   for this purpose.

 

18   BY MR. ROSEN:

 

19   Q.  Do you remember?

 

20   A.  I was working for EBSCO and Stanford and volunteering for

 

21   San Francisco State and Arlene Guerrero.  So if you count the

 

22   volunteer work it was four simultaneously.

 

23   Q.  And that was all four in the year 1998 at the same time?

 

24   A.  At the same time, yes.  I worked -

 

25   Q.  Okay.

 

                                                           628

 

 1   A.  - at two other jobs earlier in 1998, -

 

 2   Q.  Okay.

 

 3   A.  - and later, another job.

 

 4   Q.  So the p- - I believe my question was:  Did you have any

 

 5   idea of the magnitude, even a range, of what your husband earned

 

 6   in 1998?

 

 7             You've now told us that he didn't make much because

 

 8   you had to go out and work four jobs.  That doesn't answer my

 

 9   question, ma'am, so I'll repeat it.

 

10             Did you have any idea of the magnitude of your

 

11   husband's earnings in 1998?  A range?

 

12   A.  I think it was about a quarter of what he had earned the

 

13   year before.

 

14   Q.  When I ask of a magnitude could you give us a range in

 

15   dollars?

 

16   A.  No.

 

17   Q.  And the belief that you have that it was a quarter of what

 

18   he earned the year earlier, is that a belief that you formed

 

19   after 1998, in preparation for your testimony here?

 

20   A.  In preparation for doing the tax returns for 1998.

 

21   Q.  In the year 1998 did you have any idea as to even the

 

22   magnitude, the range of your husband's income for that year?  In

 

23   the - in the year 1998 and specifically as of December 17th of

 

24   that year?

 

25             And can you just say yes or no, if you had an idea of

 

                                                           629

 

 1   the magnitude or not.

 

 2   A.  Well, the number 40,000 sticks in my mind, but I don't know

 

 3   if that's the case.  This would have been gross earnings.

 

 4   Q.  And that's your recollection as to your knowledge in 1998 as

 

 5   to what your husband had earned in that year, 1998, right?

 

 6   A.  And you're asking me what I remembered then?

 

 7   Q.  Yes.

 

 8   A.  I don't think I had a good memory at that point.

 

 9   Q.  Let me see if I can assist you.  Page 42, line 1:

 

10             "QUESTION:  Do you have some concept of the magnitude

 

11   of Mr. Henson has earned as an independent contractor?  I'm not

 

12   asking for an exact number, but 5,000, 10,000, 50,000, something

 

13   like that.

 

14             "ANSWER:  Not really, no.

 

15             "QUESTION:  No concept of the order of magnitude?

 

16             "ANSWER:  No."

 

17             Do you remember being asked those questions and giving

 

18   those answers?

 

19   A.  Not specifically.

 

20   Q.  You have - you have that in front of you?

 

21   A.  Yes.

 

22   Q.  Okay.  Now that I've read it and now that you've seen it, is

 

23   that - was that testimony truthful, ma'am?

 

24   A.  I certainly did my best to tell the truth.

 

25   Q.  Was this testimony truthful?

 

                                                           630

 

 1             THE COURT:  Which testimony was truthful -

 

 2             MR. HIBBARD:  Your Honor, objection, argumentative.

 

 3             MR. ROSEN:  What I just read.

 

 4             THE COURT:  Didn't you just ask her that?

 

 5             MR. ROSEN:  No - yeah, I did.  She didn't answer the

 

 6   question.

 

 7             THE COURT:  Yes, she did.

 

 8             MR. ROSEN:  Oh, I'm sorry.  I heard a nonresponsive

 

 9   answer.

 

10             THE COURT:  She said, "I...did my best to tell the

 

11   truth," or to say something -

 

12   BY MR. ROSEN:

 

13   Q.  When -

 

14             THE COURT:  - to that effect.

 

15   BY MR. ROSEN:

 

16   Q.  When is it that you prepared the tax returns for 1998?

 

17   A.  I think it was October of '99.

 

18   Q.  And you prepared Mr. Henson's tax return at that time or

 

19   just prepared your own, ma'am?

 

20   A.  I prepared my own, but we had to sit down together and look

 

21   at joint information such as the mortgage and the child care

 

22   expenses, so I -

 

23   Q.  Ms. Lucas, - I'm sorry -

 

24             THE COURT:  Don't interrupt her answer.

 

25   BY MR. ROSEN:

 

                                                           631

 

 1   Q.  I thought you were done.

 

 2             THE COURT:  Go ahead.  You can finish.  If you're

 

 3   finished, fine.

 

 4             THE WITNESS:  I think I'm finished.

 

 5   BY MR. ROSEN:

 

 6   Q.  Are you done, ma'am?

 

 7   A.  Yes.

 

 8   Q.  Ms. Lucas, the fact of the matter is that in 1998 you and

 

 9   your husband filed separate tax returns, right?

 

10   A.  I believe that was the first year we did that.

 

11   Q.  Okay.  And you're telling me that you had to sit down and

 

12   discuss with your husband matters that relate to both returns,

 

13   such as deducting a child, right?

 

14   A.  Yes.

 

15   Q.  Did you see Mr. Henson's tax return, the portion of it that

 

16   reported his income for that year?

 

17   A.  I saw the papers, but I don't think I saw the figures.

 

18   Q.  Okay.  Well, a moment ago, ma'am, you said that you did not

 

19   know his income in 1998 until, quote, I prepared the tax

 

20   returns.

 

21             You didn't prepare his tax return for 1998, did you,

 

22   ma'am?

 

23             MR. HIBBARD:  Well, first of all, I'm going to object.

 

24   That's not the quote.  It misstates her testimony.

 

25             THE COURT:  Sustained.

 

                                                           632

 

 1   BY MR. ROSEN:

 

 2   Q.  You didn't prepare his tax return for 1998, did you, ma'am?

 

 3   A.  No.

 

 4   Q.  Okay.  Let's go to the next thing.  You've tes- -

 

 5             MR. ROSEN:  Excuse me a second, Your Honor.

 

 6   BY MR. ROSEN:

 

 7   Q.  Ms. Lucas, you've testified here, including just before

 

 8   lunch in response to my questions, about credit cards.  Credit

 

 9   cards that either Mr. Henson had or that the two of you had

 

10   jointly.  Do you recall that testimony?

 

11   A.  Yes.

 

12   Q.  And you didn't mention a credit card called the Chase

 

13   Advantage Credit, did you -

 

14   A.  No, I didn't.

 

15   Q.  - in your testimony?

 

16   A.  It's not a credit card.

 

17   Q.  What is it?

 

18   A.  It's a line of credit.

 

19   Q.  Okay.  So in 1998, including in February and March of that

 

20   year, your husband had a line of credit with Chase Advantage

 

21   Credit; is that right?

 

22   A.  I believe so.  I don't remember when that credit started.

 

23   Q.  Okay.  And you also did not mention a credit card issued by

 

24   GE, General Electric Card Services?  You didn't mention that

 

25   credit card either, did you, ma'am?

 

                                                           633

 

 1   A.  I believe that was the one I called the More Card.  It

 

 2   transformed into GE and then into something else.

 

 3   Q.  But in 1998 it was GE, right?

 

 4   A.  I don't remember what it was called at that point.  It

 

 5   changed so many times.

 

 6   Q.  Well, let me see if I can refresh your recollection.  Page

 

 7   77, line 12:

 

 8             "QUESTION:  What about GE Card Services?

 

 9             "ANSWER:  I believe that is a credit card of my

 

10   husband's."

 

11             Does that help refresh your recollection that in 1998

 

12   the credit card was GE?

 

13   A.  No more than what I just said.

 

14   Q.  Okay.  Now you testified to - in response to Mr. Zlotoff's

 

15   questions that the Whole Life Policy which had been, I think

 

16   your words, gifted to Alcor was a joint policy, you and your

 

17   husband.  Do you remember that testimony, ma'am?

 

18   A.  Yes.

 

19   Q.  In fact, that testimony you gave in this court was untrue,

 

20   wasn't it?

 

21   A.  I testified to the best of my knowledge.

 

22   Q.  Ms. Lucas, did you testify to the best of my knowledge under

 

23   oath in December of 1998 on the very same subject?

 

24   A.  I'm sure I did.

 

25   Q.  Okay.  Ms. Lucas, I'm going to ask you whether you remember

 

                                                           634

 

 1   being asked these questions and giving these answers, starting

 

 2   on line 20, page 92:

 

 3             "QUESTION:  Now I've referred to car insurance and

 

 4   home owner's insurance.  Is there any other insurance that you

 

 5   have?

 

 6             "ANSWER:  You pointed out to me that there was a

 

 7   payment to health insurance.

 

 8             "QUESTION:  Right.  Is there anything besides those

 

 9   three?

 

10             "ANSWER:  There is some life insurance.

 

11             "QUESTION:  On both of you?

 

12             "ANSWER:  There is no joint life insurance."

 

13             Do you recall being asked those questions and giving

 

14   those answers, ma'am?

 

15             THE COURT:  She said there's no joint -

 

16             THE WITNESS:  I think so.

 

17   BY MR. ROSEN:

 

18   Q.  Right.  That's what it is, that's what you testified to, a

 

19   joint life insurance policy.

 

20             Do you recall giving those answers, ma'am?

 

21   A.  I think so.

 

22   Q.  Were they true at the time?

 

23   A.  If I may explain, -

 

24   Q.  No, no.  I'm just asking you whether your answers given were

 

25   true at the time.

 

                                                           635

 

 1             MR. HIBBARD:  No, I'm -

 

 2   BY MR. ROSEN:

 

 3   Q.  You left plenty of opportunity -

 

 4             THE COURT:  Let me him - let him state his objection -

 

 5             MR. HIBBARD:  Objection, argumentative.

 

 6             THE COURT:  Sustained.

 

 7   BY MR. ROSEN:

 

 8   Q.  Were they true at the time, ma'am?

 

 9             MR. HIBBARD:  Objection, argumentative.

 

10             THE COURT:  Sustained.

 

11             MR. ROSEN:  That's not argument, was the - was the

 

12   testimony given true.

 

13             THE COURT:  She wanted to give you an explanation, you

 

14   interrupted her.  She will explain it to you if you want to

 

15   know -

 

16             MR. ROSEN:  I haven't asked her for an explanation,

 

17   Judge.

 

18             THE COURT:  Well, can you answer it yes or no?

 

19             THE WITNESS:  Yes, I guess.

 

20   BY MR. ROSEN:

 

21   Q.  Okay.  And continuing on, on line 3:

 

22             "QUESTION:  I don't mean joint, but do you each have

 

23   policies?

 

24             "ANSWER:  I have a life insurance policy and I believe

 

25   he has his own."

 

                                                           636

 

 1             Do you recall being asked that question and giving

 

 2   that answer, ma'am?

 

 3   A.  I think so.

 

 4   Q.  And you were then asked the question on line 7:

 

 5             "Are those term policies or" - and your answer on line

 

 6   - beginning on line 8:

 

 7             "I don't know what his is.  Mine is a Whole Life, I

 

 8   believe."

 

 9             Do you recall being asked those questions and giving

 

10   those answers?

 

11   A.  I think so.

 

12   Q.  Now, ma'am, do you know whether your husband - we've already

 

13   talked about t patents your husband owns.  Do you know whether

 

14   your husband owns any copyrights, trademarks, or trade secrets?

 

15             As you sit here today.

 

16             THE COURT:  You're talking about in the present, does

 

17   he own in the present?

 

18   BY MR. ROSEN:

 

19   Q.  As you sit here - no.  As you sit here today do you know if

 

20   your husband owned at any time in 1998 any copyrights,

 

21   trademarks, or trade secrets?

 

22   A.  He may have owned copyrights because copyrights incur -

 

23   occur when you write something, but other than that, as far as

 

24   having registration, I don't know.  I didn't know then and I

 

25   don't know now.

 

                                                           637

 

 1   Q.  In fact, Ms. Henson, in 19- - excuse me, Ms. Lucas.  I'm

 

 2   sorry I keep doing that and I apologize for it.

 

 3             In fact, Ms. Lucas, in 1998 you didn't know if your

 

 4   husband owned - you didn't even - you didn't know if he owned

 

 5   any copyrights, trademarks, or trade secrets; isn't that true?

 

 6   A.  I didn't know for certain.

 

 7   Q.  You didn't know at all, not for certain?  Did you suspect

 

 8   that he did in 1998?

 

 9   A.  I thought he might have written something that might have

 

10   had an inherent copyright, but other than that I was thinking

 

11   about whether it might be registered.

 

12   Q.  Do you remember being asked the following question and

 

13   giving the following answer, page 93, line 15:

 

14             "Do you know if Mr. Henson owns any copyrights?

 

15             "ANSWER:  I don't know."

 

16             Do you remember giving that answer?

 

17   A.  Not specifically.

 

18   Q.  But if you gave that answer it would have been true at the

 

19   time, right, ma'am?

 

20   A.  I would have believed so.

 

21   Q.  Okay.  Do you know now as you sit here what Mr. Henson was

 

22   earning on a current basis in December of 1998?

 

23             I'm not asking you about the prior part of the year.

 

24   I'm just focusing on in December of 1998.  Do you know what he

 

25   was earning at that time?

 

                                                           638

 

 1   A.  Do I know now?

 

 2   Q.  Yes.

 

 3   A.  No.

 

 4   Q.  Did you know then?

 

 5   A.  I probably knew what he was earning per hour, but whether he

 

 6   was earning that at any specific time or who he was working for

 

 7   or if he was working, but I knew what - what he charged, but I

 

 8   don't remember specifically if he was working for someone or

 

 9   invoicing someone.

 

10   Q.  Can you tell us whether there was anybody he was - any

 

11   client he was working for at that time in December of '98?

 

12   A.  He might have been working for MediaGate or Cubic.  I know

 

13   he worked for them during that period of time, but I don't know

 

14   specifically about that time.

 

15   Q.  Page 110, line 22:

 

16             "QUESTION:  Do you know what income Mr. Henson is

 

17   currently making?

 

18             "ANSWER:  No, I don't.

 

19             "QUESTION:  Do you know who he's doing work for?

 

20             "ANSWER:  No, I don't."

 

21             Were those answers true?

 

22   A.  Yes.

 

23   Q.  So let me see if I understand this relationship between you

 

24   and your husband.  He works and you don't know who he's working

 

25   for.  You don't know if he has any income; is that right?

 

                                                           639

 

 1   A.  You're putting that in the present tense, as if it has

 

 2   always been true rather than at only specific periods.

 

 3   Q.  Excuse me.  In 1998, in the year 1998, you didn't know who

 

 4   your husband was working for and you didn't know what money he

 

 5   was making; is that right?

 

 6   A.  Not if you're talking about the whole year.

 

 7   Q.  It's wrong?

 

 8   A.  Yes.

 

 9   Q.  When - was it right at any point in the year?

 

10   A.  Yes.

 

11   Q.  When?

 

12   A.  I can't remember specific periods.

 

13   Q.  Well, ma'am, you testified before lunch that you and your

 

14   husband agreed to a certain level of not exchanging information

 

15   and secrecy because of the disputes going on with Scie- - quote,

 

16   Scientology.  You testified before lunch that that started in

 

17   the spring of 1999.

 

18   A.  I said I couldn't remember exactly when it started.

 

19   Q.  I see.  You recall testifying before lunch that your

 

20   testimony was it started in the spring of '99?

 

21   A.  I don't remember exactly.  I thought I said that I wasn't

 

22   certain what it reminded - when it started.  It might have been

 

23   '99, might have been '98, might have been 2000.  I know there

 

24   were periods in those years -

 

25   Q.  Do you have any - any better recollection as you sit here

 

                                                           640

 

 1   now?

 

 2   A.  No.

 

 3   Q.  Okay.  Let's talk about the artwork, if we might for a

 

 4   moment.  Now you were asked several questions about this by Mr.

 

 5   Zlotoff; do you recall that?

 

 6   A.  By - oh, yes.

 

 7   Q.  Mr. Zlotoff.

 

 8   A.  In - in - yes.

 

 9   Q.  Stan.

 

10   A.  Well, I mean you're talking about yesterday or the day

 

11   before, yes.

 

12   Q.  Are you having trouble remembering that?

 

13             I'll withdraw the question.

 

14             Well, let me see if I understand your testimony about

 

15   the artwork.  There was a piece of art that was given by your

 

16   ex-husband, Mr. Manchester, to your daughter Amber.  One piece

 

17   of art, right?

 

18   A.  Yes.

 

19   Q.  And then later on that piece of art was exchanged at a

 

20   gallery and traded, so to speak, for four pieces of art, right?

 

21   A.  I believe it was four, yes.

 

22   Q.  And for this entire period of - let's start with the first

 

23   piece of art.  So from the beginning this piece of art that was

 

24   - this piece of art was given by your ex-husband to your

 

25   daughter.  And then obviously the exchange which occurred, where

 

                                                           641

 

 1   one piece became four pieces, your daughter continued to own

 

 2   that art, right?

 

 3   A.  Yes.

 

 4   Q.  Okay.  What is your daughter's date of birth?

 

 5   A.  10-12-82.

 

 6   Q.  Would you explain to this Court how - and, by the way, when

 

 7   were you divorced from Mr. Manchester?

 

 8   A.  I think it was '81.

 

 9   Q.  Okay.  Now Amber is the child of you and Mr. Henson, right?

 

10   A.  Yes.

 

11   Q.  I mean natural child.  She's not adopted or anything, she's

 

12   your natural daughter?

 

13   A.  Yes.

 

14   Q.  And she was born in October of '82?

 

15   A.  Yes.

 

16   Q.  Well, Ms. - Ms. Lucas, could you explain to me how Mr.

 

17   Manchester made a gift of the original piece of art to your

 

18   daughter when - in the year 1979, three years before your

 

19   daughter was even born?  Can you explain that?

 

20   A.  I don't remember if that was the year, in any case I thought

 

21   he gave it in trust to us for her - for -

 

22   Q.  So - I'm sorry.  I thought you were done.  I didn't mean to

 

23   interrupt you.  Keep going.  You thought he gave it in trust.

 

24   Go ahead.

 

25   A.  I don't remember that that was the year he gave it to us.  I

 

                                                           642

 

 1   - to her - Mr. Manchester originally lent me that piece of art

 

 2   for use in a business that I was running.  I placed it on the

 

 3   wall -

 

 4             MR. ROSEN:  Your Honor, I move to strike this.  The

 

 5   question - this is not responsive to my question at all.

 

 6             MR. HIBBARD:  Well, I think she needs to finish her

 

 7   answer before you move to strike it.

 

 8             THE COURT:  Go ahead, finish your answer.

 

 9             THE WITNESS:  I don't believe that the year 1979 is

 

10   the correct year that he gave it to my daughter, is what I've

 

11   tried -

 

12   BY MR. ROSEN:

 

13   Q.  When did he give it to your daughter?

 

14             MR. HIBBARD:  Would you let her finish the -

 

15             THE COURT:  Right.  You're producing a terrible

 

16   record, because every time she speaks you overlap.

 

17             MR. ROSEN:  I'm sorry, Your Honor, -

 

18             THE COURT:  You've got to let her finish.

 

19             MR. ROSEN:  Your Honor, I can't hear her very well.

 

20   She's speaking in an extraordinarily low voice and not talking

 

21   into the microphone.  I hear silence.  You're three feet away

 

22   from her.  You may be able to hear her continuing to talk.  And

 

23   maybe Mr. Hibbard has better hearing than I do, because I don't

 

24   have really good had been.  But I'm hearing silence.  I'm not

 

25   trying to interrupt her.  I think she's done.

 

                                                           643

 

 1             THE COURT:  Just try to keep your voice up a little.

 

 2             THE WITNESS:  I think 1979 is the correct year or may

 

 3   be close to when Mr. Manchester lent me the piece of artwork for

 

 4   my business, because he knew it was one that I loved and that

 

 5   with the decor of the business that I was running.

 

 6             I don't remember the year in which he gave it to our

 

 7   daughter.  It may have been somewhere between '83 and '85, when

 

 8   the business failed, and I was trying to give it back to him.

 

 9             He told me that he had nowhere to put it because his

 

10   residence was unsuitable for a work of art.  And he wished to

 

11   give it to my daughter instead.

 

12             MR. ROSEN:  Move to strike.  Totally nonresponsive to

 

13   my question.

 

14             MR. HIBBARD:  I'd like to hear why it's not

 

15   responsive.

 

16             MR. ROSEN:  The question had nothing to do with what

 

17   Mr. Manchester told her, which the witness has been able to in

 

18   the course of being nonresponsive introduced hearsay as well.

 

19             MR. HIBBARD:  Well, the -

 

20             MR. ROSEN:  Whatever Mr. Manchester said to her is

 

21   hearsay.  You wouldn't allow that in, Judge, if the question

 

22   were asked what did Mr. Manchester say to you.

 

23             This witness is very practiced in terms of how to get

 

24   into this record by offering nonresponsive answers, testimony

 

25   that you would not allow in.  What did Mr. Manchester say to

 

                                                           644

 

 1   her.  What did she say to him.

 

 2             MR. HIBBARD:  Are you through?

 

 3             Okay.  The question was how did this happen -

 

 4             MR. ROSEN:  That's not the question, Your Honor.

 

 5             THE COURT:  The question was related to when

 

 6   Manchester gave the daughter the painting.

 

 7             MR. ROSEN:  Right.

 

 8             MR. HIBBARD:  Correct.

 

 9             THE COURT:  And -

 

10             MR. ROSEN:  And "when" calls for a year, Your Honor.

 

11   As I asked this witness several times in this examination, just

 

12   tell me - when I start a question with the word "when," it calls

 

13   for a year, a date.

 

14             MR. HIBBARD:  Well, I think it calls for whatever

 

15   answer the witness wants to give you is what I think it calls

 

16   for.  And I think her - well, I'd say for sure that the

 

17   testimony was responsive.  If you want to strike out the hearsay

 

18   part of it, fine.  But - well, you need to make that motion,

 

19   though.

 

20             THE COURT:  Yeah.  What Mr. Manchester is stricken,

 

21   the rest of it stays.

 

22   BY MR. ROSEN:

 

23   Q.  What is the year that Mr. Manchester made this gift of this

 

24   painting to your daughter?

 

25   A.  I don't remember the specific year.  I was saying that it

 

                                                           645

 

 1   was some time between 1982 and 1985 as far as I recollect.

 

 2        (Telephone ringing.)

 

 3   BY MR. ROSEN:

 

 4   Q.  198- - did you say '83?

 

 5             THE COURT:  '5.

 

 6   BY MR. ROSEN:

 

 7   Q.  '5.  Between 198- -

 

 8             THE COURT:  Between '82 and '85 she testified, if you

 

 9   came here -

 

10   BY MR. ROSEN:

 

11   Q.  In other words, - in other words, Mr. Manchester gave this

 

12   to your daughter, who was born in October of '82, in that year?

 

13   A.  It's possible.

 

14   Q.  It's possible.  Is that your testimony under oath, as oppose

 

15   to "It's possible," ma'am?

 

16             MR. HIBBARD:  Objection, Your Honor, argumentative.

 

17             THE COURT:  Sustained.

 

18   BY MR. ROSEN:

 

19   Q.  Okay.  Now let's go over this.  At the time that you - do

 

20   you remember when you received the painting?

 

21   A.  I think that probably was - it was some time between '79 and

 

22   '81.

 

23   Q.  And where were you living at the time?

 

24   A.  Tucson, Arizona.

 

25   Q.  And you were operating some sort of a business?

 

                                                           646

 

 1   A.  Yes.

 

 2   Q.  And Mr. Manchester, who at that time starting in '79, was

 

 3   your ex-husband, where was he living at that time?

 

 4   A.  I'm not sure when the divorce was, it might not have been

 

 5   until '81.  He was living in British Columbia or possibly in

 

 6   Washington.

 

 7   Q.  Washington, the state of Washington?

 

 8   A.  Yes.

 

 9   Q.  Is that where he was living at the time he - you first took

 

10   possession of this painting?

 

11   A.  Yes.

 

12   Q.  So let's see if I get this right now.  This is a painting

 

13   that Mr. Manchester owned, right?

 

14   A.  Yes.

 

15             MR. HIBBARD:  Your Honor, I'm - I'm going to object to

 

16   this line of question as being asked and answered and also

 

17   argumentative.  We don't need to review.  I think he asked that

 

18   question or not, but -

 

19             MR. ROSEN:  This is cross-examination, Your Honor.

 

20             THE COURT:  Haven't you asked all these questions

 

21   before, -

 

22             MR. ROSEN:  No.  I want to make sure -

 

23             THE COURT:  - and then you would move to strike the

 

24   part where she explained about Mr. Manchester.

 

25             MR. ROSEN:  I didn't ask her anything about what Mr.

 

                                                           647

 

 1   Manchester said to her.

 

 2             THE COURT:  But you - you asked her how she got the

 

 3   painting, when.  And she tried to explain it all, and now you're

 

 4   going back through the whole story again.

 

 5             MR. ROSEN:  You know, Judge, I'm sorry, I can't -

 

 6   that's not what I asked, and the record will show that your

 

 7   comment is incorrect.  I'm not eliciting any hearsay from her.

 

 8   I've never asked her -

 

 9             THE COURT:  We're not talking about hearsay.  You're

 

10   now going back to Mr. Manchester again.

 

11             MR. ROSEN:  Yes, I am.

 

12             THE COURT:  I'll - I'll give you a couple of

 

13   questions.  Go ahead, let's see where you go.

 

14   BY MR. ROSEN:

 

15   Q.  Okay.  So let's see if I get this right now.  Mr. Manchester

 

16   owned this painting.  And some time between 1979 and 1981, he

 

17   loaned it to you to - while living in Washington or British

 

18   Columbia, for you to display in your place of business in

 

19   Tucson, Arizona; is that your testimony?

 

20   A.  Yes.

 

21   Q.  And it was some time after that that Mr. Manchester then

 

22   gave this same painting, which was in your possession in Tucson,

 

23   Arizona, that he made a gift of that to your daughter?

 

24   A.  Yes.

 

25   Q.  At a time when your daughter is anywhere between one and

 

                                                           648

 

 1   three years old, right?

 

 2   A.  Yes.

 

 3   Q.  Okay.  Now is the reason that Mr. Man- - withdraw that.

 

 4             Did you have a home of your own in Tucson, Arizona  at

 

 5   the time you took - you got this painting?

 

 6             MR. HIBBARD:  Your Honor, I'm going to object.  This

 

 7   is completely irrelevant.

 

 8             MR. ROSEN:  I don't think so.  I'm leading to

 

 9   impeachment.

 

10             THE COURT:  I'll allow her to answer this question.

 

11   BY MR. ROSEN:

 

12   Q.  You were living someplace, right, ma'am?

 

13   A.  Yes.  But in 1985 we were in transition, so I don't remember

 

14   whether we had a home at that time.

 

15   Q.  I'm not asking about 1985, ma'am.  I'm asking about the time

 

16   you got the painting from Mr. Manchester -

 

17             THE COURT:  She's already testified that it was some

 

18   time between '82 and '85.

 

19             MR. ROSEN:  No.  She's testified between '79 and '81,

 

20   Your Honor.

 

21             THE COURT:  That's when she got it originally.

 

22             MR. ROSEN:  That's what I just asked, when you got

 

23   the -

 

24             THE COURT:  Okay.  So you're not asking when it was

 

25   gifted, you're asking when she received it the first time.

 

                                                           649

 

 1             MR. ROSEN:  That's what my question was.

 

 2             THE COURT:  Okay.

 

 3   BY MR. ROSEN:

 

 4   Q.  When you received the painting from Mr. Manchester, some

 

 5   time between 1979 and 1981, you had some place you were living?

 

 6   You weren't living in your business or in the street, right?

 

 7   A.  For part of that time I did live in the business.

 

 8   Q.  And for the rest of the time, did you have a place to live?

 

 9   A.  Yes.

 

10   Q.  Ma'am, do you recall executing an affidavit on August 26 of

 

11   the year 2000, an affidavit that was submitted to this Court in

 

12   opposition to RTC's original motion to dismiss filed over two

 

13   years ago?  Do you recall submitting an affidavit?

 

14   A.  I've submitted a number of affidavits.  I don't remember

 

15   that one specifically.

 

16             MR. ROSEN:  Okay.  I'm going to - we'll make copies of

 

17   this during the break, Your Honor.  I wasn't anticipating that

 

18   we would need this for -

 

19             THE COURT:  That's fine.  We'll break for 15 minutes

 

20   at this point.

 

21             MR. ROSEN:  Okay.

 

22             THE COURT:  You can make your own copies.

 

23             MR. ROSEN:  I don't - is there -

 

24             THE COURT:  There's a machine right down the street at

 

25   Kinko's.

 

                                                           650

 

 1             THE CLERK:  There's a copy center by the Clerk's

 

 2   Office.

 

 3             MR. ROSEN:  Question.

 

 4             THE CLERK:  Please rise.

 

 5        (Recess taken from 2:48 p.m. to 3:24 p.m.)

 

 6             THE CLERK:  Please rise.

 

 7             THE COURT:  Thank you, ladies and gentlemen.  Please

 

 8   be seated.

 

 9             You may process.

 

10             MR. ROSEN:  Thank you, Your Honor.

 

11             Ms. - Your Honor, we have the exhibits being

 

12   photostated.  In the meantime, just so we don't - I will move

 

13   along with different questions and then we'll get to the

 

14   exhibits, and we are going to introduce them.

 

15   BY MR. ROSEN:

 

16   Q.  Ms. Lucas, do you recall appearing for a 2004 examination in

 

17   this bankruptcy proceeding on Thursday, February 17th of the

 

18   year 2000?

 

19   A.  Yes.

 

20   Q.  Do you recall being asked questions about this artwork at

 

21   that time?

 

22   A.  I know that I was asked about it at some deposition, I don't

 

23   remember which one.

 

24   Q.  Okay.  Is it true that Mr. Manchester offered to give the

 

25   artwork to you, but you said, 'No, give it to my daughter

 

                                                           651

 

 1   instead'?

 

 2   A.  I seem to remember that he wanted to give it to me, but that

 

 3   it - I didn't feel proper about it because by then I was married

 

 4   to someone else, and so he decided to give it to my daughter.

 

 5   Q.  And do you recall, ma'am, that this conversation you had

 

 6   with Mr. Manchester in which he said, in words of substance, 'I

 

 7   want to give it to you,' and you said, 'No' - in substance, 'No.

 

 8   Give it to my daughter.'

 

 9             Do you recall that that conversation occurred in 1979?

 

10   A.  No.

 

11   Q.  Page 276 -

 

12             MR. ROSEN:  Your Honor, I don't have a copy of this.

 

13   I will - I'm going to mark it -

 

14             THE COURT:  I thought we were going to wait until -

 

15             MR. ROSEN:  No, this -

 

16             THE COURT:  - to make cop- -

 

17             MR. ROSEN:  - is something else.  They're

 

18   photostating -

 

19             THE COURT:  So why didn't you -

 

20             MR. ROSEN:  - the declarations.

 

21             THE COURT:  So why didn't you have them make copies of

 

22   that if you wanted to -

 

23             MR. ROSEN:  Because I just found this in my notes.

 

24   And I - if there's any question about the reading of it, I -

 

25             THE COURT:  Can you send somebody to the copy center

 

                                                           652

 

 1   and just have copies made?

 

 2             MR. ROSEN:  Your Honor, -

 

 3             THE COURT:  It's right here.  You have three people

 

 4   with you, four people, -

 

 5             MR. ROSEN:  I know, Your Honor.  But then we have to

 

 6   stop the hearing and we -

 

 7             THE COURT:  For one second while you get that, and you

 

 8   move onto something else.

 

 9             MR. ROSEN:  Your Honor, may I ask Your Honor if we can

 

10   use Your Honor's facilities to photostat four pages?

 

11             THE COURT:  Why don't - it's just down the hall, Mr.

 

12   Rosen.  And you have four people at least -

 

13             MR. ROSEN:  Just down the hall?  Okay.

 

14             THE COURT:  Thank you.

 

15             MR. ROSEN:  Do we need the cover page of the

 

16   deposition, Your Honor?

 

17             THE COURT:  Yes.

 

18             MR. ROSEN:  And do you want the certification or will

 

19   you take my representation?

 

20             THE COURT:  I'd like the certification.

 

21             MR. ROSEN:  You'd the reporter's certification?

 

22             THE COURT:  Yes, so that everybody has it.  So each

 

23   lawyer has it and there's no question.

 

24             MR. ROSEN:  Okay.  Okay.

 

25   BY MR. ROSEN:

 

                                                           653

 

 1   Q.  Ms. Lucas, this conversation that you've just testified to

 

 2   in which Mr. Manchester offered it to you and you said, 'No,

 

 3   give it to my daughter,' that conversation occurred, to your

 

 4   recollection, when?

 

 5   A.  I'm not sure.  It may have been not a single conversation

 

 6   but a - it could be that when he first lent it to me, he said

 

 7   that it was a loan but that it could become a gift at some

 

 8   point.

 

 9   Q.  A loan that could become a gift.

 

10   A.  And if I - if we talked about that at that point, I might

 

11   have said, 'Well, we can talk about it later.'  I wasn't even

 

12   pregnant in '79 so I don't think I would have mentioned a child,

 

13   although I was trying to get pregnant I think by 1981, or '2, I

 

14   forget.

 

15   Q.  Ms. Lucas, the conversation you just described with Mr.

 

16   Manchester in which he offered to give it to you and you said,

 

17   'No, no.  I don't want it.  Give it to my daughter,' what is

 

18   your testimony here under oath in this proceeding as to what

 

19   year that conversation occurred?

 

20             MR. HIBBARD:  Your Honor, -

 

21   BY MR. ROSEN:

 

22   Q.  And if it was more than one conversation, tell me the - when

 

23   the first part of the conversation occurred, when did this

 

24   dialogue begin, in other words?

 

25             MR. HIBBARD:  Your Honor, once again this is improper.

 

                                                           654

 

 1   If he wants to refresh her recollection, he's allowed to do so.

 

 2   The witness has answered the best she can.  He's got to show her

 

 3   the document.

 

 4             THE COURT:  I'll allow the question, if you remember.

 

 5             THE WITNESS:  No, I don't remember.  And '97 - '79

 

 6   doesn't sound right because the business wasn't - there wasn't a

 

 7   business in '79, I don't think.

 

 8   BY MR. ROSEN:

 

 9   Q.  Ms. Lucas, do you have any recollection of what year it was

 

10   when this conversation occurred or when, if it may have been

 

11   more than one, that the conversation began?

 

12   A.  There may have been more than one conversation and it would

 

13   have occurred at the time that he was talking about lending me

 

14   an artwork that he had just bought.

 

15   Q.  Ms. Lucas, my question was when?

 

16   A.  I don't remember when.

 

17   Q.  Okay.  Now, Ms. Lucas, at the time of this conversation with

 

18   Mr. Manchester of he wanting to give it to you, and you saying,

 

19   'No, no, no.  Give it to my daughter instead,' had you already

 

20   had possession of this artwork?

 

21   A.  I don't remember.

 

22   Q.  Well, you testified a few moments ago that you were opening

 

23   a business in Tucson and Mr. Manchester loaned it to you to hang

 

24   in your business.

 

25             Now I'm trying to understand, was this conversation

 

                                                           655

 

 1   about giving it to you and you saying, 'No, no.  Give it to my

 

 2   daughter,' did it occur when you first got physical possession

 

 3   of the artwork or did it occur at some time after that, ma'am?

 

 4   A.  I think it was some time after that.  There was a whole long

 

 5   series of events in which I saw pieces of it in order to match

 

 6   the painting of the business to the artwork, so that it would be

 

 7   a central piece.  And so he sent those to me, and it was months

 

 8   before I actually saw the artwork.

 

 9             MR. ROSEN:  Your Honor, I move to strike.  This is not

 

10   responsive.

 

11             THE COURT:  Overruled.  She's doing the best she can

 

12   to explain to you what's going on.

 

13   BY MR. ROSEN:

 

14   Q.  Well, Ms. Lucas, -

 

15             THE COURT:  Let's - excuse me.  I understand - when do

 

16   - Mr. Zlotoff, I got a note that Mr. Zlotoff has to go to Judge

 

17   Grube's courtroom at 4:00.  And so you'll let me know when you

 

18   have to go.

 

19             Did you arrange for a calendar placement?

 

20             MR. ZLOTOFF:  Yes.  I talked with Millie about that.

 

21             THE COURT:  Okay.

 

22   BY MR. ROSEN:

 

23   Q.  All right.  I'm sorry, with the interruption I lost my train

 

24   of thought for a moment.  Let me go back.

 

25             Was it at or about the same time that you first got

 

                                                           656

 

 1   physical possession of the artwork that you had this

 

 2   conversation with Mr. Manchester or was it some time -

 

 3             MR. HIBBARD:  Objection, Your Honor.  I'm sorry.

 

 4             THE COURT:  Let him finish his question.

 

 5             MR. HIBBARD:  I'm sorry.

 

 6   BY MR. ROSEN:

 

 7   Q.  - or was it some time after that?

 

 8             MR. HIBBARD:  Asked and answered.  She said - she said

 

 9   she doesn't know.

 

10             THE COURT:  Sustained.

 

11   BY MR. ROSEN:

 

12   Q.  How long was it between the time you first got the artwork

 

13   and the time you had this in your possession, the time you had

 

14   this conversation with Mr. Manchester?

 

15             MR. HIBBARD:  The same objection, Your Honor.

 

16             THE COURT:  Sustained.

 

17   BY MR. ROSEN:

 

18   Q.  Ms. Lucas, was the artwork in your possession continuously

 

19   from the time you first got it from Mr. Manchester?  And by that

 

20   I mean was there a period of time that you returned it, that he

 

21   was back in possession of it.

 

22   A.  No.

 

23   Q.  You had it continuously?

 

24   A.  Yes.  Sometimes it was in storage.

 

25   Q.  Okay.  Ms. Lucas, - well, yeah.

 

                                                           657

 

 1        (Creditor's counsel confer off record.)

 

 2             MR. ROSEN:  Your Honor, may I hand up what I've marked

 

 3   as plaintiff's Exhibit 294?

 

 4             THE COURT:  Yes.  Have you given it opposing counsel?

 

 5             MR. ROSEN:  Going to.  You see that -

 

 6             THE COURT:  That'll be fine.

 

 7             MR. ROSEN:  - it's - it's right in my right hand.

 

 8             THE CLERK:  My last one was 291.

 

 9             MR. HIBBARD:  Thank you.

 

10             THE COURT:  So this is 292?

 

11             MS. KOBRIN:  It's 292.

 

12             THE COURT:  It's 292.

 

13             MR. ROSEN:  No.  I've offered 294 because there's

 

14   another one I'm going to get to later I think that has that

 

15   number, because I marked it out of order.

 

16             THE COURT:  Well, what about 293?

 

17             MR. ROSEN:  I have that marked also separately.

 

18             THE CLERK:  293.

 

19             THE COURT:  Do you want to give them all to my Deputy

 

20   so she can mark them for you and we can have them.  And we can

 

21   put them in the books, and every - and I'll have them and we'll

 

22   put the holes in them and we -

 

23             MR. ROSEN:  I will, Your Honor, but I'd like to - if I

 

24   can just defer that until I get to the next exhibit.  I may not

 

25   have to use it.

 

                                                           658

 

 1             THE COURT:  Well, then -

 

 2             MR. ROSEN:  It depends on the questions and the

 

 3   answers -

 

 4             THE COURT:  Then this one should be 292.

 

 5             MR. ROSEN:  Okay.  Then let's make -

 

 6             THE COURT:  If you don't - if you don't need to -

 

 7             MR. ROSEN:  - it 292.

 

 8             THE COURT:  Okay.  Let's make it 292.  If you may not

 

 9   get to the others.

 

10             MR. ROSEN:  Okay.

 

11   BY MR. ROSEN:

 

12   Q.  I think I was asking you before the break, Ms. Lucas, if you

 

13   recall testifying on this subject in the examination on February

 

14   17th, 2000, on the artwork.  And I now propose to read to you

 

15   and ask you whether or not you recall being asked these

 

16   questions and giving these answers.  Page 276, starting on line

 

17   9 -

 

18             MR. ROSEN:  And, Your Honor, I want to make something

 

19   clear.  In the - given that we had to do this during a break, I

 

20   am offering for - into evidence only the portions of this

 

21   exhibit that I am reading from.  Ordinarily we would redact the

 

22   portions that I'm not reading from, as we have from the other

 

23   exhibits.  I didn't physically have time to do that.  So I will

 

24   be offering only the portions that I'm reading from.  And that's

 

25   why I'm identifying page and line.

 

                                                           659

 

 1   BY MR. ROSEN:

 

 2   Q.  Page 276, line 9:  "QUESTION:  Tell me what the occasion

 

 3   was.

 

 4             "ANSWER:  I just said it was a long story.  I'll make

 

 5   it as short as I can.  I opened the business in around 1979,

 

 6   called Date Game.  And when I did so I fashioned a color scheme

 

 7   from a work by Jesse Allen.  My ex-husband knew what this color

 

 8   scheme was, so he wanted to make that available to me."  The

 

 9   original artwork.

 

10             "I talked with him about it.  I said, 'For goodness

 

11   sake, don't you,' then he was making some money.  He said,

 

12   'Okay, I'll tell you what, I'll give it to your daughter,' and I

 

13   said, 'Fine.'"

 

14             And that ends on page - on line 19.  I've just read

 

15   the question and answer from line 9 to line 19.

 

16             Do you recall being asked that question and giving

 

17   that answer, ma'am?

 

18   A.  I recalled the questions and I recall trying to go through a

 

19   mental process of something that had happened 20 years before

 

20   that was very difficult for me.

 

21   Q.  Ma'am, do you recall giving this answer I just read?

 

22   A.  I don't recall giving that specific answer.

 

23   Q.  I - okay.  Continuing on line 20 - and, by the way, in 9- -

 

24   at the time you gave this answer, on February 17th, 2002, you

 

25   were of course aware of the birthdate of your daughter, right?

 

                                                           660

 

 1   A.  Not in -

 

 2             MR. HIBBARD:  Your Honor, I would object, because if

 

 3   you read this, there's nothing in there saying she got the

 

 4   painting in 1979.  It says she opened up a business in 1979, and

 

 5   it was a whole long story.

 

 6             MR. ROSEN:  Your Honor, I would ask that there not be

 

 7   speaking objections that would prompt the witness.  That's not

 

 8   an objection.

 

 9             THE COURT:  It's an objection:  It's not proper

 

10   impeachment.  That's what the objection is.  And it only -

 

11             MR. ROSEN:  Well, then he can just say proper

 

12   impeachment.  Your Honor, I just read it.

 

13             MR. HIBBARD:  Well, it also misstates - it misstates

 

14   her testimony.  It misstates what it says here.

 

15             MR. ROSEN:  No.  It says this is 1979.

 

16             MR. HIBBARD:  No.  It says he started -

 

17             THE COURT:  He opened a business in 1979.

 

18             MR. HIBBARD:  That's all it says, in '79.

 

19             MR. ROSEN:  Continue on.  And she fashioned the color

 

20   scheme.

 

21             THE COURT:  Yeah.

 

22             MR. ROSEN:  And when she opened the business.

 

23             MR. HIBBARD:  Didn't say when she gave it to her

 

24   daughter.

 

25             THE COURT:  It is what it is.  I'll let it in.  It's -

 

                                                           661

 

 1   BY MR. ROSEN:

 

 2   Q.  Is it correct -

 

 3             THE COURT:  It's certainly ambiguous as to the date.

 

 4   BY MR. ROSEN:

 

 5   Q.  Is it correct that you did open a business in 1979 called

 

 6   Date Game?

 

 7   A.  Data Game, and I don't -

 

 8             THE COURT:  Data Game.

 

 9   BY MR. ROSEN:

 

10   Q.  Data Game.

 

11   A.  And I don't remember - I actually think it was more like

 

12   1980, but I don't remember the year just now.

 

13   Q.  Is it correct that at the time you opened the business in

 

14   terms of preparing and furnishing your place of business in

 

15   Tucson for Data Game, that you selected a color scheme?

 

16   A.  Yes.

 

17   Q.  Is it - is it correct that at the time you selected this

 

18   color scheme, as you were opening your business, that you

 

19   selected the color scheme to go with the work by Jessie Allen?

 

20   A.  Yes.

 

21   Q.  And the work that Jessie Allen - by Jessie Allen is the

 

22   piece of art that we're talking about, the original one piece

 

23   that later was traded for four pieces; is that right?

 

24   A.  Yes.

 

25   Q.  Is it correct that your ex-husband at the time you opened

 

                                                           662

 

 1   this business knew what your color scheme was?

 

 2   A.  He knew that I was basing it on a painting which we had both

 

 3   seen.

 

 4   Q.  Is it correct, "My husband" - "ex-husband knew what this

 

 5   color scheme was"; is that correct?

 

 6   A.  No.

 

 7   Q.  You testified that way here, ma'am.  Are you saying that

 

 8   your testimony given under oath was wrong?

 

 9             MR. HIBBARD:  Objection, Your Honor.  That's improper

 

10   impeachment.  If he wants to -

 

11             THE COURT:  Sustained.

 

12   BY MR. ROSEN:

 

13   Q.  And you es- - and is it correct that when he - you told him

 

14   about the color scheme, he wanted to make this piece of art

 

15   available to you, right?

 

16   A.  Yes.  First he - he got some -

 

17             MR. ROSEN:  Your Honor, I just asked if - yes or no.

 

18             THE COURT:  If you can't answer it yes or no, say

 

19   that.  If you can, just say yes or no.

 

20             THE WITNESS:  There's a sequence of events.  If you

 

21   don't care about the sequence of events, then I'll just answer

 

22   yes.

 

23   BY MR. ROSEN:

 

24   Q.  Thank you.

 

25             Now let's continue on on line 20 on page 276.  Do you

 

                                                           663

 

 1   recall being asked these questions and giving these answers:

 

 2             "So this was a piece of art he wanted to give to you?

 

 3             "ANSWER:  Well, it was a piece of art that he wanted

 

 4   me to benefit from.  And I said I really don't want to accept a

 

 5   present from you, but if you want, you know, - well, he said,

 

 6   'How about if I give it to your daughter.'  And I said, 'Fine.'"

 

 7             That ends on line 1 of 2- - page 277.

 

 8             Do you remember being asked those questions and giving

 

 9   those answers?

 

10   A.  I remember this sequence of questions and answers.  I don't

 

11   remember these specifically.

 

12   Q.  Do you recall - and were your answers truthful?

 

13   A.  Yes.

 

14   Q.  Okay.  Continuing on page 277, line 14:

 

15             "QUESTION:  I'm confused.  Twenty years ago, when was

 

16   it that he gave your daughter this piece of art?  I thought it

 

17   was 1995.

 

18             "ANSWER:  No.  1995 was when we traded it in.

 

19             "QUESTION:  I see.  When did you get it?  When did he

 

20   give it to you or when did he give it to your daughter, I guess?

 

21             "ANSWER:  I believe it was when I was pregnant with

 

22   her."

 

23             And that completes at line 20 of that page.  Do you

 

24   remember giving - being asked those questions and giving those

 

25   answers?

 

                                                           664

 

 1   A.  In a general way, yes.

 

 2   Q.  So is it your testimony now after we've gone over this that

 

 3   your ex-husband gave this painting to your daughter at a time

 

 4   when she was, I think the expression is enfanter summair

 

 5   (phonetic), when you were pregnant?

 

 6   A.  I didn't remember then and I don't specifically remember now

 

 7   whether it was during my pregnancy or during the next three or

 

 8   four years.

 

 9   Q.  Continuing on line 21, once you said that, the next question

 

10   is:

 

11             "So your ex-husband gave a piece of art to an unborn

 

12   child?

 

13             "ANSWER:  Yes.  I think what happened was that he -

 

14             "QUESTION:  Thank you.  You've answered my question."

 

15             Okay.  Do you remember being asked that question and

 

16   giving that answer?

 

17   A.  Generally.

 

18   Q.  Okay.  Let's go to - and that ends on line 24 on 277.

 

19             On page 278, line 2, you are saying:

 

20             "Just that my ex-husband had it on loan to me.

 

21             "QUESTION:" line 4, "What do you mean 'on loan to'

 

22   you?

 

23             "ANSWER:  It was on loan in the business.  It was

 

24   sitting there in the business."

 

25             And I'll stop there.  That's the middle of line 6.

 

                                                           665

 

 1             Well, as it was sitting there in the business, ma'am,

 

 2   was it on loan to you or had it been gifted to your unborn

 

 3   child?

 

 4   A.  It was on loan to me until -

 

 5   Q.  Okay.

 

 6   A.  - such time as it was given to the child.

 

 7   Q.  And continuing on, questions about the business, on line 16,

 

 8   page 278:

 

 9             "This is the business you started?

 

10             "ANSWER:  Yes.

 

11             "QUESTION:  What year

 

12             "ANSWER:  I think it was '79, '80, somewhere in there.

 

13             "QUESTION:  And when did the business go broke?

 

14             "ANSWER:  I think the bankruptcy was filed in '85."

 

15             Do you remember giving those answers to those

 

16   questions?

 

17   A.  Generally, yes.

 

18   Q.  And does that help refresh your recollection that this

 

19   conversation about the painting Mr. Manchester, giving it to

 

20   your daughter occurred two years before your daughter was born?

 

21   A.  I didn't say that.

 

22   Q.  Okay.

 

23   A.  I was trying very hard to recollect something that was a

 

24   very long time ago and reconstruct it when I hadn't thought

 

25   about it for years.

 

                                                           666

 

 1   Q.  Now, ma'am, from the time that you moved this piece of

 

 2   artwork from the business to your home, this artwork hung in the

 

 3   common portions of the room, never in your daughter's room.  Is

 

 4   that right?

 

 5   A.  My recollection is that at first it moved from the business,

 

 6   when the business closed, to storage.  And that -

 

 7   Q.  And when -

 

 8   A.  - from storage it was then taken to a different storage in

 

 9   California, when we moved from Arizona to California.  And that

 

10   when we had a place to hang it, we - when we had a house to hang

 

11   it in, we consulted our daughter about where she would like to

 

12   see it hung.  And her room was quite small -

 

13             MR. ROSEN:  I move to strike this.  This is not

 

14   responsive.

 

15             THE COURT:  I'd have to listen to the question again

 

16   to see whether -

 

17             MR. ROSEN:  My question is did the - did the - this

 

18   piece of artwork ever hang in her daughter's bedroom.

 

19             THE COURT:  I didn't think that was the question,

 

20   but -

 

21             THE WITNESS:  I didn't think it was either.

 

22             THE COURT:  No.  I don't think it was.  If you want -

 

23             MR. ROSEN:  Can we have it read back -

 

24             THE COURT:  Huh?  Sure.

 

25             MR. ROSEN:  Can we have it read back?

 

                                                           667

 

 1             THE COURT:  Sure.  I knew you asked about the

 

 2   daughter's bedroom, but I don't think that's all you asked from.

 

 3   I think you asked whether it went from one place to another.

 

 4             MR. ROSEN:  Well, -

 

 5             THE COURT:  And she's telling you the chronology of

 

 6   where it went.

 

 7             MR. ROSEN:  No.  She's talking about a conversation

 

 8   that she had with her daughter, which I did not ask any question

 

 9   to elicit this hearsay.

 

10        (Pause in the proceedings.)

 

11             THE COURT:  Are you going to read it -

 

12             THE REPORTER:  Do you want me to -

 

13             THE COURT:  Oh, yes, please.

 

14             THE REPORTER:  I'm sorry.

 

15        (Record played.)

 

16             THE REPORTER:  Okay.

 

17             MR. ROSEN:  Called for a simple yes or no answer, Your

 

18   Honor.

 

19             MR. HIBBARD:  No, it didn't.

 

20             THE COURT:  No.  The - the motion to strike is denied.

 

21   She - it didn't - what you asked for is - you've stated facts in

 

22   your question that weren't true, and she was correcting your

 

23   question.  And that is it went directly from the business to the

 

24   home.  And she was saying, no, it didn't do that.  And she was

 

25   explaining to you what it did.  And so that's why you got the

 

                                                           668

 

 1   answer you did.  You've stated facts in your question that

 

 2   weren't correct, and she was perfectly correct in correcting the

 

 3   question.  That's, in fact, answering in a way that would

 

 4   correct the question.

 

 5             MR. ROSEN:  Your Honor, I think you misunderstand.  My

 

 6   motion to strike had nothing to do with her explanation that the

 

 7   artwork went from the business into storage.

 

 8             It had to do with the end of her answer, which was

 

 9   'and I had a conversation with my daughter and asked her where

 

10   she wanted it hung.'

 

11             THE COURT:  No.  That's stricken.

 

12             MR. ROSEN:  Thank you.

 

13             THE COURT:  The conversation is stricken.

 

14   BY MR. ROSEN:

 

15   Q.  All right.  So let's -

 

16             THE COURT:  If they want to bring that back up, they

 

17   can bring that back up.

 

18   BY MR. ROSEN:

 

19   Q.  Okay.  So, Ms. Lucas, let's see if I understand this.  About

 

20   19- - from the time you received this in '79 or '80, this piece

 

21   of art, it hung in your business in Tucson, Data Game, until

 

22   that business went broke in 1985; is that right?

 

23   A.  Yes.

 

24   Q.  And then in 1985 it was put into storage?

 

25   A.  Yes.

 

                                                           669

 

 1   Q.  And the next time it was taken, it was placed in - the first

 

 2   time it was placed in your home, then was when you bought your

 

 3   first house in California, right?

 

 4   A.  No, we rented first.

 

 5   Q.  You rented, okay.  And when was that?

 

 6   A.  I think it was '85, late '85.

 

 7   Q.  Okay.  And was it taken out of storage and placed in the

 

 8   house at that time?

 

 9   A.  It took a while, but, yes.

 

10   Q.  When?

 

11   A.  It might have been early '86 before we got it out of

 

12   storage.

 

13   Q.  And is it correct that when you took it out of storage and

 

14   brought it to the house you rented, it was hung in the living

 

15   room?

 

16             Yes or no, ma'am.

 

17   A.  I'm trying to remember.  I believe it was, yes.

 

18   Q.  And then you hung it in your second house, right?

 

19   A.  Yes.

 

20   Q.  And at the time - when did you get your second house?

 

21   A.  '93.

 

22   Q.  And at the time you hung it in your second house, that house

 

23   was in San Jose, ma'am?

 

24   A.  The first - the first house we bought.  The second house we

 

25   lived in in this area was in San Jose, yes.

 

                                                           670

 

 1   Q.  And when that artwork was hung in the second house, it was

 

 2   hung in the living room, right?

 

 3   A.  Yes.

 

 4   Q.  And then you bought your third house in Palo Alto in 1996;

 

 5   is that right