EFTA00801709.pdf

1 2 UNCERTIFIED TRANSCRIPT DISCLAIMER IN THE MATTER OF 3 EPSTEIN 4 v. 5 EDWARDS 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801709  1 The following transcript(s) of proceedings, or any portion 2 thereof, in the above-entitled matter, taken on December 3 5th, 2017, is being delivered UNEDITED and UNCERTIFIED by 4 the official court reporter at the request of Kara 5 Rockenbach, Esquire. 6 The purchaser agrees not to disclose this uncertified and 7 unedited transcript in any form (written or electronic) 8 To anyone who has no connection to this case. 9 This is an unofficial transcript, which should NOT be 10 relied upon for purposes of verbatim citation of 11 testimony. 12 This transcript has not been checked, proofread 13 or corrected. It is a draft transcript, NOT a certified 14 transcript. As such, it may contain computer-generated 15 mistranslations of stenotype code or electronic 16 transmission errors, resulting in inaccurate or 17 nonsensical word combinations, or untranslated stenotype 18 symbols which cannot be deciphered by non-stenotypists. 19 Corrections will be made in the preparation of the 20 certified transcript, resulting in differences in content, 21 page and line numbers, punctuation and formatting. 22 This realtime uncertified and unedited transcript contains 23 no appearance page, certificate page, index or 24 certification. 25 DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801710  1 THE COURT: Good morning. Welcome 2 back. All right as I understand it, you 3 want to start with the issue of the motion 4 to amend the answer and affirmative 5 defenses. Is that accurate? 6 MR. SCAROLA: That is, sir. Yes. 7 THE COURT: I will be glad to do that. 8 I have reviewed the materials from both 9 sides. Thank you for that. 10 MR. LINK: Whenever you are ready, 11 Judge. 12 THE COURT: Whenever you are ready, go 13 ahead, sir. 14 MR. LINK: Good morning, Your Honor. 15 Scott Link on behalf of the plaintiff. It 16 is our motion for leave to amend the 17 affirmative defenses. You have to put that 18 in context, Your Honor. 19 That is, why do we need affirmative 20 defenses that sound in defamation, and they 21 do. The reason they do is because the 22 counter-plaintiff in this case has made it 23 very clear that they are trying the 24 allegations in the statements in the 25 complaint. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801711  1 At the last hearing, Mr. Scarola handed 2 this out and showed us very clearly what 3 their plan is. And this is their plan. 4 They believe that we're trying the factual 5 allegations of the complaint to see whether 6 they were true or false. 7 As this Court knows, in the recent 8 Supreme Court case dealing with this case, 9 the Supreme Court made it very clear that 10 there is a narrow exception to the 11 litigation privilege. That exception is for 12 malicious prosecution. But the Supreme 13 Court told us in that opinion Your-Honor -- 14 I will share it with the Court -- the 15 Supreme Court told us in that opinion, Your 16 Honor -- gave us a roadmap. 17 The Supreme Court told us. 18 THE COURT: That Debrincat, 19 D-E-B-R-I-N-C-A-T versus Fischer -- 20 MR. LINK: That's correct, Your Honor. 21 THE COURT: -- from the Florida Supreme 22 Court, So.3d cite that the parties are well 23 familiar with. 24 MR. LINK: If you are look at this 25 case, you will see that the Supreme Court DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801712  1 made it very clear and gave us a roadmap. 2 The Supreme Court said really simply -- and 3 it makes sense -- that if the litigation 4 privilege applied to the elements of a 5 malicious prosecution action, there would 6 never be a malicious prosecution action. 7 Plus the Supreme Court reaffirmed that 8 every statement made in the proceeding 9 itself: the allegations of the complaint, 10 the statements of witnesses, the statements 11 of lawyers, and the statements of the judges 12 are absolutely protected. That's why the 13 court lays out the elements. And the 14 elements the court lays out talk about only 15 the actual initiation of the lawsuit. 16 So if you turn, Your Honor, to page two 17 of three, the court sets forth the elements. 18 We will talk about these elements. The 19 Supreme Court really give us clarity. 20 At the bottom of the page two, it talks 21 about an original criminal or civil judicial 22 proceeding -- an original proceeding. That 23 proceeding, according to the Supreme Court, 24 when you read the Fourth DCA division that's 25 cited, is the filling, it's the DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801713  1 commencement, it's the action. 2 If you think about where this law came 3 from, it comes from the criminal system. If 4 you think about the criminal system, simply 5 issuing a warrant, starting an 6 investigation, filing a criminal complaint 7 in and of itself can cause injury to your 8 reputation. 9 So the Supreme Court tells us the act 10 that is not protected by the litigation 11 privilege is the initiation of a lawsuit. 12 If you look at the probable cause 13 element, it says there was an absence of 14 probable cause for the original proceeding. 15 It doesn't say claim. It doesn't 16 allegation. It doesn't say statement. 17 So Mr. Scarola tells us three times 18 during this hearing on the 29th that what he 19 plans to do -- what he plans to do -- 20 reading from this transcript at page 82 -- 21 the first thing Your Honor needs to 22 determine is the issue we have been focusing 23 on. What are the factual allegations that 24 we claim were maliciously prosecuted, and 25 then he goes to our complaint. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801714  1 According to the Supreme Court, our 2 complaint is protected. We cannot commit 3 defamation. We cannot commit any action 4 that's based on wrongful words. The only 5 thing that's available is a claim for 6 malicious prosecution focused on the 7 initiation of the suit. 8 On the last page of this opinion from 9 the Supreme Court, the court tells us this: 10 The filing of a lawsuit and the joining of a 11 defendant is the commencement of a judicial 12 proceeding. 13 It then says, really importantly, an 14 action for malicious prosecution which is 15 based as a matter of law on causing the 16 commencement of an original judicial 17 proceeding -- that's what we need focus on. 18 So if we are trying the statements and 19 the allegations of the complaint, if that's 20 what we are doing, then we have to have 21 affirmative defenses that protect us from a 22 claim based on allegations in the complaint. 23 The last thing I want to show the 24 Court, on Friday after our hearing, I took 25 the deposition of Mr. Edwards' expert. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801715  1 May I approach. During the deposition 2 of Dr. Jansen -- if you turn to page three, 3 four and five, Your Honor, you will see what 4 their expert wants to do. 5 The assignment was the level of 6 dissemination of defaming statements -- 7 defaming statements. That's on page three. 8 Page four. I refer to ties statement 9 associating Mr. Edwards with the illegal 10 activities of Mr. Rothstein's, the results 11 of Mr. Rothstein's lawsuits as the defaming 12 statements. 13 So what they plan to do is put on an 14 expert to demonstrate that the allegations 15 of the complaint were defaming and caused 16 damages, the defamation action. 17 There's nothing in the elements of 18 malicious prosecution that make it relevant 19 for an expert to get on the stand and talk 20 about defaming statements in the complaint. 21 In fact, to do so violates the roadmap 22 that the Supreme Court just gave us. There 23 is no better authority than Debrincat on how 24 this case should go forward. But if they're 25 going to be allowed to put an expert on to DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801716  1 talk about defaming statements, if they are 2 going to be allowed to put the allegations 3 of the complaint and test their truth or 4 falsity, which are protected by litigation 5 privilege, we then need to have affirmative 6 defenses that sounds like defamation. 7 Last point I want to point out in 8 Debrincat, Your Honor is this. It's in the 9 analysis, and it's the second sentence of 10 the analysis. Te law has long recognized 11 that judges, counsel, parties and witnesses 12 should be absolutely exempted from liability 13 to an action -- this is the key -- it 14 doesn't say to defamation -- to an action. 15 To be specific, to any action for defamatory 16 words published in the course of the 17 judicial proceeding. 18 So if we are exempted from liability 19 for the words published in the lawsuit, then 20 we don't need these affirmative defenses, 21 because they will then have to focus on 22 probable cause for the judicial proceeding. 23 But if they are going to by allowed to bring 24 in allegations of the complaint, truth or 25 falsity, then we need these affirmative DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801717  10 1 defenses. 2 Otherwise, if you look at our answer in 3 affirmative defenses, Your Honor, we don't 4 have any. The reason we don't have any is 5 we didn't raise advice of counsel. There's 6 not a statute of limitation defense. We 7 have no affirmative defenses because we are 8 defending a malicious prosecution action. 9 But we ask this Court, if this Court is 10 going to allow them to try the truth or 11 falsity of the statements in the complaint, 12 that we be allowed to amend our pleading. 13 THE COURT: You are not seeking to 14 amend to affirmatively defend on advice of 15 counsel? 16 MR. LINK: We are not, sir. They are 17 all defamation affirmative defenses. 18 THE COURT: Well, there's also the 19 constitutional affirmative defenses that you 20 are seeking to interpose dealing with the 21 petition to file against the government or 22 something along those lines. 23 MR. LINK: Those are all defamation. 24 They are all protection of speech. 25 THE COURT: I presume that falls under DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801718  11 1 that same umbrella. 2 MR. LINK: It does, Your Honor. 3 Everything that we've asked the Court to 4 allow us to amend is designed to protect our 5 record, frankly, that we believe that 6 everything in our pleading -- let me give 7 you an example. 8 The Court dismisses Mr. Edward's count 9 for abuse of process based on litigation 10 privilege. At the end of the suit when we 11 win, if we sued Mr. Scarola for malicious 12 prosecution in going forward with this case, 13 are the statements he's made in this 14 proceedings -- for example, Mr. Epstein is a 15 serial child molester -- are they protected 16 because they're part of this proceeding? Or 17 does he waive the privilege somehow because 18 we bring a malicious prosecution action? 19 This court tells us very clearly we 20 could not sue Mr. Scarola for his 21 statements. It is no purpose in the 22 malicious prosecution action. 23 But that's what this door is opening. 24 That's what they want to do. And we suggest 25 to Your Honor, we don't want to come back a DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801719  12 1 second time. We would like to try this case 2 once. We would like to focus on the 3 elements of malicious prosecution and not 4 try a defaming words case in front of the 5 jury. 6 Thank you, Your Honor. 7 THE COURT: Okay thank you, Mr. Link. 8 Who is going to arguing on behalf of 9 Mr. Edwards? Mr. Burlington? 10 MR. BURLINGTON: May it please the 11 Court. I am Phillip Burlington representing 12 Brad Edwards. 13 I have not heard anything today that 14 justifies their claim that the rights to 15 petition the government provides them an 16 affirmative defense as they allege in their 17 fifth affirmative defense. That has nothing 18 to do with defamation. We have explained 19 why it is not a defense to a malicious 20 prosecution case. Because as the US Supreme 21 Court has stated very clearly, baseless 22 litigation is not protected by the privilege 23 to engage in petitioning of the government 24 under the First Amendment. 25 I would note that even considering the DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801720  13 1 presentation here, there is not a single 2 case from any jurisdiction cited by them 3 that says that any of these defenses are 4 valid in a malicious prosecution case. Not 5 a single case. 6 They have gone so far as to site the 7 Noerr/Pennington cases, which are anti-trust 8 cases involving efforts to lobby the 9 legislative and executive branches of 10 government, and they have taken that and 11 tried to apply it to the malicious 12 prosecution case. That makes to sense. 13 Now, as to the other defenses, they 14 have also passed over two very critical 15 considerations which were not addressed in 16 their motion -- and have not been addressed 17 here, and I hope will not be addressed for 18 the first time in the rebuttal, since we 19 addressed it very squarely in our 20 response -- and that is, there are three 21 grounds to deny a motion to amend. One is 22 where the party has abused privilege. The 23 second is where the amendment would 24 prejudice the opposing party, and then the 25 third is whether the affirmative defenses DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801721  14 1 would be futile because they are legally 2 insufficient. 3 Now, in this case they've raised five 4 affirmative defenses eight years into the 5 litigation and mere weeks before of this 6 special setting that this Court had for this 7 month. 8 We pointed out in our response. There 9 was no explanation why it took them eight 10 years to dream up these affirmative 11 defenses. That is an abuse of the 12 privilege, waiting until the eve of trial, 13 after discovery is almost completely 14 concluded to raise multiple affirmative 15 defenses, many of which raise factual issues 16 that would require further discovery, 17 possibly new experts, and maybe even counter 18 pleading. Those reasons in themselves are 19 sufficient to justify denial of this motion. 20 But, I have spend more time on the 21 futility, because I certainly understand 22 that Your Honor has always expressed concern 23 that people are allowed to amend. And 24 again, we don't think that they should based 25 on the abuse of the privilege and based on DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801722  15 1 the prejudice to our client. But I will get 2 back to the legal insufficiency. 3 The argument that the Debrincat case 4 gives a roadmap is simply wrong. Debrincat 5 is not a roadmap. It is a dead end. It was 6 the determination that the litigation 7 privilege does not apply to a malicious 8 prosecution case. 9 And this is very clearly stated in the 10 paragraph preceding its conclusion. This 11 court has never held that the litigation 12 privilege protects a litigant from the claim 13 of malicious prosecution. And other 14 district courts have recognized that the 15 litigation privilege does not act as a bar 16 to a malicious prosecution claim. 17 If the Florida Supreme Court was 18 holding that it does not bar proof of the 19 first element of malicious prosecution, they 20 would have said that and said it remains in 21 force for the other elements. Clearly they 22 would not have been as categorical as they 23 were. 24 What they have done is try to parse out 25 language, again trying to make the roadmap DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801723  16 1 when it's clear this was intended to be a 2 dead end for that privilege. 3 And they talk about it's only the 4 initiation of the claim that subjects them 5 to liability. But even in Debrincat when it 6 talks about the first element, it says an 7 original criminal or civil judicial 8 proceeding against the present plaintiff was 9 commenced or continued. In this case, 10 obviously, it was continued. 11 They include the other elements, which 12 include that there was an absence of 13 probable cause for the original proceeding. 14 That means we can prove that the factual 15 allegations were false, that the legal 16 claims were invalid, as a matter of law, and 17 nothing in Debrincat precludes that. 18 It was a simple, very short decision 19 for the Florida Supreme Court. And it 20 simply said the privilege does not apply to 21 malicious prosecution claims. 22 But even putting aside Debrincat, we 23 have never had a defamation claim. We have 24 never alleged it. And they have this string 25 site of cases that talks about how, well -- DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801724  17 1 it's called the single publication rule. If 2 your cause of action is based on a 3 defamatory publication, you can't avoid 4 defenses to defamation or the statute of 5 limitations by pleading things like 6 intentional inflection of emotional distress 7 or tortious interference with business 8 relationships, so forth and so on. 9 It has nothing to do -- not a single 10 one of those cases had to do with malicious 11 prosecution. The only one that comes within 12 shouting distance is Fridovich. But in that 13 case, the Fourth District rejected the 14 malicious prosecution case, because that 15 case arose out of family allegations that a 16 family member murdered somebody, and they 17 were essentially fighting over the estate. 18 They created this conspiracy to bring 19 claims to the prosecutor to prosecute that 20 family member for murder. That family 21 member was ultimately convicted of 22 manslaughter. 23 So the Fourth District said that's not 24 a bona fide termination in your favor, so 25 they eliminate the malicious prosecution. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801725  18 1 Then they went with defamation counts and 2 related counts. It was a certified question 3 in Fridovich -- talks about defamation. 4 But they have cited no case from any 5 jurisdiction that says that you can convert 6 a malicious prosecution case into a 7 defamation case, and then raise defenses 8 that are unique to defamation cases. 9 And this reliance on the deposition 10 taken recently is nothing but -- that was 11 a -- that was an expert on damages, and 12 damages to reputation as a result of false 13 statements, which is an inherent part of a 14 malicious prosecution case. An they have 15 cited no case to the contrary. 16 THE COURT: You have cases that cite 17 affirmatively to that proposition? 18 MR. BURLINGTON: There is a case called 19 Mancusi out of the Florida Supreme Court 20 that define the elements and talked about it 21 is designed -- in fact, Debrincat says that 22 malicious prosecution is balanced between 23 allowing people to bring suits and 24 protecting the reputation of the individual. 25 So that's one -- that's the nature of DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801726  19 1 it. I mean, the fact that there are similar 2 elements of damage does not convert 3 malicious prosecution to a defamation count. 4 And they have cited no case for that 5 proposition. 6 But even if we go a little deeper into 7 these defamation claims to the defamation 8 defenses, they are clearly invalid as a 9 matter of law. 10 For example, the fifth one -- excuse 11 me. I have already addressed the fifth one. 12 The sixth one claims that Mr. Edwards 13 is a public figure. Now, as noted 14 previously, this would raise a whole new 15 factual set of issues plus perhaps the need 16 for experts. 17 But the Gertz case makes it crystal 18 clear that a private attorney representing a 19 client, despite their involvement in a 20 high-profile case, including their 21 involvement in a proceeding unrelated to 22 their civil proceeding is not a public 23 figure, that you cannot convert -- they are 24 very specific. You cannot convert a private 25 attorney representing a client into an DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801727  20 1 officer of the court to bootstrap yourself 2 into saying it's a public official. 3 And they also said in that case that we 4 are not going to hold that someone who 5 simply engages in their professional 6 activities or has involvement in the 7 community is converted to a public figure. 8 And what they have attached to their 9 motion to amend, which they claim Brad 10 Edwards made himself into a public figure is 11 nothing more than website statements on the 12 law firm where Brad Edwards worked that 13 talked about some of his cases. And that's 14 nothing more than his professional 15 responsibility and professional relationship 16 for purposes of getting clients. 17 THE COURT: Résumé. 18 MR. BURLINGTON: Excuse me? 19 THE COURT: Résumé. 20 MR. BURLINGTON: Sure. 21 And there's nothing even -- only one of 22 them mentions Epstein. 23 So they have cited no case from any 24 jurisdiction that says that a defamation 25 count can result in either a higher burden DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801728  21 1 of proof or additional affirmative defenses 2 based on the nature of the individual who 3 was sued in the baseless litigation. 4 Then their seven affirmative defense, 5 just asserts generally just as a matter of 6 public concern, and thereof we have a higher 7 burden of proof. 8 Again, this is rather late in the game 9 to start changing, not only the factual 10 issues, but the burdens of proof. But they 11 also cite no case from any jurisdiction that 12 says a malicious prosecution case is altered 13 on the basis of whether there was a matter 14 of public concern involved. 15 And here, inverting that notoriety of 16 Mr. Epstein's criminal conduct into a matter 17 public concern is somewhat of a stretch. 18 But also, in the Gertz case there was 19 notoriety in that criminal case. And Gertz 20 made it very clear that the private attorney 21 representing a client in proceedings and in 22 related proceedings, which had a lot of 23 publicity, did not convert him to either a 24 public official or a public figure, and 25 whether or not it was a matter of public DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801729  22 1 concern was not relevant. 2 The case that they seemingly rely on is 3 the Nodar case, which is a Florida case 4 where the parent went to the board of the 5 school board to speak out against a teacher 6 that he believed was no properly preparing 7 the students, not properly teaching and was 8 harassing his son. 9 That was a public forum. It was an 10 executive branch, not a judicial branch. 11 And all that the Florida Supreme Court held 12 was in that context -- because it was a 13 matter of public concern in the appropriate 14 public forum -- there was a qualified 15 privilege, and the malice would not be 16 presumed from the defamatory statements. 17 Now, again, that was a defamation suit. 18 It was nothing about malicious prosecution. 19 But as Justice Scalia noted in his 20 concurring opinion in the Kalina case, 21 malicious prosecution has the qualify 22 privilege built into it, because we have to 23 prove, not only a lack of probable cause, 24 but we have to prove malice, and we do not 25 get a presumption of malice. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801730  23 1 So that case, the Nodar case, has 2 nothing to do with either the context of 3 this case or the cause of action that we had 4 brought. 5 And they've cited, as I've said, no 6 malicious prosecution cases to support the 7 idea that any of these defenses can be 8 valid. 9 Now, as to the -- I believe it's the 10 eighth and ninth affirmative defenses, they 11 are not affirmative defenses at all. 12 Affirmative defense, as the Florida 13 Supreme Court has stated, is where a 14 defendant essentially has to admit the 15 allegations of the pleading. But say -- 16 even assuming that -- I have this defense or 17 you are limited in these matters in proving 18 your case or in your damages. 19 Their eighth affirmative defense simply 20 says this is nothing but a defamation suit. 21 That's not an affirmative defense. That is 22 a legal proposition which they rely on to 23 provide the predicate for the sixth and 24 seventh affirmative defenses, but it is 25 nothing but a statement of a legal DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801731  24 1 proposition. It is not a defense. 2 The last affirmative defense claims 3 that there are known procedures that this 4 court could put in place that could protect 5 Epstein's due process rights in the context 6 of the punitive damage claims. That's not 7 an affirmative defense. That's a 8 constitutional challenge in the proceedings 9 of this court. While III not saying they 10 can't raise constitutional challenges, it is 11 not a affirmative defense. 12 I would add, they haven't specified a 13 single thing that has happened thus far in 14 the context of punitive damages that has 15 deprived Mr. Epstein of any due process 16 rights. 17 And I gave a brief summary in our 18 response to all the protections that have 19 been established in the case law, in the 20 statutes for protecting due process rights. 21 And until and unless they come to you 22 with a colorable argument that those 23 procedures are inadequate, there's nothing 24 for you to do in response that generic 25 assertion that Mr. Epstein could never have DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801732  25 1 his due process rights protected in the 2 context of the punitive damage award. But 3 what is clear is it's not an affirmative 4 defense at all. 5 So, trying to parse out Debrincat to 6 say that the litigation privilege only 7 applies to one element of the malicious 8 prosecution claim, I submit is facially 9 wrong in light of the complaint. And if 10 they believe that Debrincat, which concludes 11 by saying unequivocally that the litigation 12 privilege does not apply to malicious 13 prosecution cases, they had an obligation 14 because they were a tag-along case. And the 15 Florida Supreme Court, after issuing 16 Debrincat, issued an order in our case 17 saying that Epstein should show cause why 18 Debrincat does not control. And in 19 response, Epstein conceded that it did 20 control. There is no to parse out anything 21 in Debrincat which would create entirely new 22 law in Florida about parsing out elements of 23 malicious prosecution for either purposes of 24 forcing the plaintiff into a position of 25 having a defamation claim or of taking out DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801733  26 1 specific elements of a malicious prosecution 2 claim and saying, oh we have defamation 3 defenses to these. 4 The falsity of the statements in the 5 complaint are entirely different from a 6 publication, because it is the act of 7 triggering the judicial mechanism forcing my 8 client to defend, litigate, expend funds. 9 And the falsity of those statements goes to 10 lack of probable cause, it goes to malice, 11 and it is an element that we can prove 12 caused harm, and we should get compensatory 13 damages. 14 Again, they cited no case. They relied 15 solely on Debrincat, and it is an extremely 16 thin read upon which to entirely change the 17 law of malicious prosecution. And I believe 18 that Your Honor should deny the motion based 19 on being untimely with no explanation. 20 None of these cases are new. Debrincat 21 is the only one that's within the last few 22 years. But they had time to raise that. 23 All the others are established law. It just 24 doesn't apply here. 25 THE COURT: Let me ask you to explain DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801734  27 1 for me, if you will, the issue of futility. 2 Because usually because of Florida's policy 3 on liberality of amendments even at trial -- 4 cases after trial that allows for amending 5 the pleadings -- the amendment is typically 6 allowed, and then the affirmative defenses 7 are attacked, traditionally by a motion to 8 strike. 9 Here your arguments on behalf of your 10 client are that these amendments are 11 essentially futile in the sense that I 12 analogize it with a cause of action brought 13 by a plaintiff in a given case where the 14 plaintiff is alleging some type of -- 15 attempting to allege some type of cause of 16 action that makes no legal sense, or it is 17 barred by the existing precedent so as to 18 make any amendments futile. 19 I would suspect that that same analogy 20 could apply here. Albeit, this is the first 21 effort, at least as to these affirmative 22 defenses, that have been made. 23 But are you suggesting that under no 24 reading of law and the facts that apply here 25 that it would be either amendable or that DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801735  28 1 any potential amendment based on these facts 2 and the law that have constituted these 3 proposed affirmative defense would be 4 futile? 5 MR. BURLINGTON: You are correct that 6 normally when affirmative defenses are 7 initially asserted in a timely fashion that 8 the means of challenging their legal 9 sufficiency is a motion to strike. 10 When a no motion to amend is 11 presented -- especially this late in the 12 game -- it would be a waste of judicial 13 resources for you to allow the amendment 14 knowing that as a matter of law those 15 defenses are invalid. 16 And there are cases -- not sure 17 they're the ones cited in our response -- 18 but I have cited case on futility where if 19 they're legally invalid, they're necessarily 20 futile. 21 And to go through the motion of 22 allowing them to amend, requiring us to move 23 to strike, allowing them to respond when the 24 legal sufficiency is addressed in these 25 memos. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801736  29 1 They cited case law in their 2 affirmative defenses themselves trying to 3 justify them. So the futility is 4 different -- not different, but the need to 5 do a motion to strike is different when the 6 amendment is made, when you come to the 7 Court and seek it to exercise its discretion 8 to allow an amendment, if it is legally 9 invalid, there's no reason for the Court to 10 allow it, because it would be futile. And 11 that's one of three ways of attacking the 12 motion to amend as discussed in all the case 13 law. 14 Otherwise, to say it would be futile, I 15 guess, we would have to get into the factual 16 analysis of where the facts don't support 17 it. But there isn't much difference between 18 saying the facts don't support it and this 19 doesn't apply as a matter of law to this 20 cause of action. 21 So I believe you are fully authorized 22 to look at the merits of these claims, which 23 have been argued in the motion and the 24 response -- and they've certainly had an 25 opportunity today to argue what they thought DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801737  30 1 was the legal validity. 2 So to simply put that off and have 3 another hearing on it when the question here 4 is, do you allow amendments which I believe 5 are clearly not valid to a malicious 6 prosecution cause of action. So I believe 7 you are authorized to do it on that basis as 8 well. 9 THE COURT: Thank you, Mr. Burlington. 10 I appreciate your written and oral 11 presentation, as well, Mr. Link. 12 MR. SCAROLA: May I add just a little 13 bit to that? 14 THE COURT: I will give you a couple 15 minutes. 16 MR. SCAROLA: Thank you very much, sir. 17 THE COURT: After Mr. Scarola, 18 Ms. Rockenbach, if you want to add something 19 you are free to do so as well. 20 MS. ROCRENBACH: Thank you, Your Honor. 21 MR. SCAROLA: I don't think that it 22 will take a couple minutes. 23 It was one aspect -- 24 THE COURT: Less than that? 25 MR. SCAROLA: Yes, sir. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801738  31 1 There was one aspect of Mr. Link's 2 argument that I found extremely confusing. 3 And maybe it's just some -- 4 MR. LINK: Your Honor, you mind if I 5 move so I can -- 6 THE COURT: Feel free. 7 MR. SCAROLA: -- some inability on my 8 part to comprehend the argument. But he 9 told us repeatedly that Edwards seeks to 10 prove the falsity of the allegations of the 11 complaint instead of proving there was no 12 probable cause to file the complaint. I 13 think he repeated that statement at least 14 three times. And quite frankly, I have no 15 idea what that means. 16 In order to prove there was no probable 17 cause to file the complaint, we must look at 18 the factual allegations in the complaint and 19 we must demonstrate that there was no 20 probable cause to file those specific 21 factual allegations. That is, we must prove 22 the factual allegations were false, and we 23 must prove that there was no reason to 24 believe that they were true. This wasn't a 25 good faith mistake. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801739  32 1 So the issues are identical. And what 2 they were attempting to do by way of this 3 motion to amend is to get right back to 4 where they were arguing last week, and that 5 is, they don't want to ever have to defend 6 against the claim that Bradley Edwards 7 fabricated false charges against Jeffrey 8 Epstein. They don't want to focus on that 9 at all. And this is one more means by which 10 to attempt to reargue that same position. 11 THE COURT: Or fabricated false claims 12 against Jeffrey Edwards (sic) or -- 13 MR. SCAROLA: Jeffrey Epstein. 14 THE COURT: Fabricated false -- 15 MR. SCAROLA: Edwards fabricated false 16 claims against Epstein. 17 THE COURT: Correct. 18 MR. SCAROLA: We will help each other 19 out with that. 20 THE COURT: Or vice versa for that 21 matter, that Epstein fabricated false claims 22 against Edwards. Meaning, I am still not 23 sure where the defendant in the malicious 24 prosecution claim, Mr. Epstein, stands as to 25 that issue, as to whether or not he's DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801740  33 1 conceding or not conceding. 2 MR. SCAROLA: That has been 3 scrupulously avoided by the other side, Your 4 Honor. They don't want to face that issue 5 or even acknowledge it exists. I agree with 6 Your Honor. 7 THE COURT: Thank you, Mr. Scarola. 8 Mr. Link, couple things that I would 9 like you to focus on. First is that -- I 10 appreciate your bringing it to my attention, 11 and I have heard this before, about the 12 punitive expert's testimony on behalf of 13 Mr. Edwards, that his research has revealed 14 whatever number of instances whereby 15 Mr. Edwards' and Mr. Rothstein's names have 16 been linked, presumably as a result of 17 Mr. Epstein's conduct. 18 MR. LINK: Yes, Your Honor. 19 THE COURT: I haven't read it very 20 closely. At this point I don't know much of 21 that testimony is going to get in. But 22 irrespective of that, what Mr. Burlington 23 has emphasized and what the Court clearly is 24 under the impression as to its utilization, 25 is not to prove up any other element of the DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801741  34 1 malicious prosecution claim, except for 2 damages. 3 For example, an affirmative defense to 4 that aspect of the claim could potentially 5 be that Mr. Edwards failed to mitigate his 6 damages by virtue of his own zeal in seeking 7 publicity for his representation of Mr. -- 8 for his representation of the alleged 9 victims and the plaintiffs in those cases 10 against Epstein, and therefore, cause much 11 of his own damages by exercising that zeal. 12 That may constitute an affirmative 13 defense as to the damage claim, because just 14 like a simple negligence action is 15 concerned, damages are a necessary element, 16 similar to the questions I had of you last 17 week when I asked what were Mr. Epstein's 18 damages as a result of his filing of the 19 initial suit against Rothstein, Edwards and 20 III. as related to factoring of those cases. 21 So, there's a distinction of importance 22 that I can see here as it pertains to the 23 affirmative defenses that have been asserted 24 as it relates to a traditional defamation 25 claim perhaps. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801742  35 1 Some of these affirmative defenses, 2 quite frankly, in handling defamation claims 3 on numerous occasions in the past, I have 4 never seen before. I never try to stifle 5 creativity. But at the same time, we have 6 to take into account, not only judicial 7 resources, but what the essential argument 8 of Mr. Burlington boiling it down to its 9 very essence is you can't fit a square peg 10 into a round hole. And that is, that the 11 bulk of these affirmative defenses, because 12 they deal with defamation, one, are not 13 pertinent. Two, even if they were, it's not 14 a defamation claim. 15 I certainly do not plan and will not 16 try a defamation claim. And also, again, 17 even if these could be conceivably construed 18 as defamation claims, they don't pass legal 19 muster. 20 Some of them, such as the affirmative 21 defense regarding the petitioning of the 22 government, has, in my view, absolutely no 23 application to this case, because if it did, 24 it would have application to any lawsuit 25 just about that I could conceive of that DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801743  36 1 would be brought by any person, by any 2 plaintiff, by any counter-plaintiff. 3 The application is completely in 4 opposite to what we're doing here. This is 5 not redressable by virtue of petition to 6 government, as are, and as were, 7 particularly at the time of those two cases, 8 Noerr and Pennington, where there were 9 issues of anti-trust violations and the 10 testing of whether or not anti-trust laws 11 were in fact being violated. And the 12 government's -- obvious because of the 13 Sherman Act -- the government is obviously, 14 because of Sherman Act, interest in 15 protecting against anti-trust violations. 16 So there was that nexus that was clearly 17 prevalent there. 18 So I really don't need further argument 19 as to the fifth affirmative defense. 20 The sixth affirmative defense deals 21 with the limited public figure. We haven't 22 really talked about that from your 23 standpoint. Your position as to that in 24 light of the Gertz decision. 25 MR. LINK: Yes. We believe that if DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801744  37 1 defamatory statements are going to be the 2 basis for liability and for damages so that 3 we're moving in absolute litigation 4 privilege from allegations in the complaint, 5 then the fact that Mr. Edwards is a quasi 6 public figure that puts himself out there, 7 that advertises, that speaks about these 8 issues, that issues press releases, talked 9 to the press, should come in as an 10 affirmative defense in this case. 11 THE COURT: How do you get around Gertz 12 essentially saying precisely the opposite, 13 that a lawyer -- even where a lawyer 14 represents a high-profile client? Here 15 these aren't high-profile clients. 16 My common sense thinking -- although 17 really not a part of the decision here -- is 18 that outside of South Florida, and had 19 Mr. Rothstein not committed the heinous 20 crimes that he's been convicted for in 21 serving a sentence somewhere in the 22 neighborhood of 50 years, Edwards would have 23 been off the radar. There would have been 24 no real issues, other than his connection 25 with Mr. Epstein. DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801745  38 1 Some may argue that Mr. Epstein is far 2 more of a public figure that Mr. Edwards is 3 under the analysis you have suggested. 4 MR. LINK: He may very well be, Your 5 Honor. 6 THE COURT: But that's not the issue 7 here. I don't see how Gertz, with the plain 8 meaning of the opinion, and the fact that 9 the attorney in Gertz was in fact 10 representing a high-profile client and there 11 was afforded immunity -- which wouldn't have 12 application here whatsoever -- I don't see 13 the basic fundamental issue being answered 14 or even arguable. 15 MR. LINK: If I can take one shot at 16 it, Your Honor. 17 THE COURT: Sure. 18 MR. LINK: I think the difference is 19 the fact that you represent a high-profile 20 client does not make you a quasi public 21 figure. It's the steps and actions that you 22 take as a result of that. 23 So, the fact that the three plaintiffs 24 that Mr. Edwards represented were not 25 high-profile folks does not mean that he DRAFT ONLY!!! NOT PROOFREAD!!! EFTA00801746  39 1 didn't voluntarily put himself out there and 2 create an image and a reputation for himself 3 and put himself out there in a public way. 4 There are easy examples. I represent a 5 high-profile client, Mr. Epstein. After the 6 hearing, the press came up, I didn't talk to 7 the press. I didn't put myself out there. 8 Other lawyers will do that. They will give 9 press releases. 10 Mr. Edwards went even beyond that. He 11 used these cases to promote himself in a way 12 that goes beyond simply representing a 13 client. 14 MR. SCAROLA: Your Honor, excuse me. 15