Thanks. It seemed an odd choice. But it was what I saw when I looked it up at Amazon.
No, it was regular print. I don't see large print on Amazon App as compared to webpage. Maybe its an amazon thing.
That does sound interesting. Is it really a large print book? That seems strange.
I don't know about "good light" - I finished it this weekend. Fascinating and enlightening is the words that comes to mind. Regardless of what is true or not in it, it was a good story. And I agree that most of these OTC CEO's are mini-madoffs as he calls them. Even if only some things are true then some assumptions are right and some things were way wrong.
Well, I think if he just made stuff up, there's a chance he could be sued anyway.
There's a reason the real people who feature in historical novels have generally been dead for a long time.
The back cover calls it a "novel." IMO the only reasons for the "fictional/ novel" disclaimer is (a) for legal reasons and (b) because the truth of their crimes are likely too mundane and boring to be marketable. Such scammers are a penny a dozen.
lol, I missed that part. What on EARTH is the point of "fictionalizing" a story that was dramatic enough in real life?
What mystifies me is why it's apparently in large print. Did he write it for his grandmother?
Self published "mea culpa" or 351 pages of whitewashing and sucking around for a movie deal? The "look inside" feature on page III says it's a "fictionalized dramtization based on a true story and real life events."
Charged, convicted and lost on appeal. I won't buy knowing a dime will go to the author. I'll wait till one shows up on eBay for $1.00. Goodwill sells books cheap there. At least the money will go to a charity.
Here's a link to it at Amazon:
Seems it's an effort to portray him and his buddies in a good light.
Nice post and good information. William Peterseim was an officer at Big Apple for years so there are multiple overlapping bad actors. Had the SEC and DOJ done its job, all the bad apples would have been indicted by the DOJ instead of given a slap on the wrist by the SEC.
Case in point - Guy Jean Pierre and the alleged FSPM scheme.
Maybe Roy Meadows would like to explain how it is that Big Apple got a free pass.
As for Hamon Francis Fytton, I've noticed he sometimes calls himself "Harmon F. Fytton", and sometimes "H. Francis Fytton". A minor point, but often a bad sign...
Just some updates for this forum (hopefully one of the admins see this)
#1) Gold Entertainment Group Inc (GEGP) was a Big Apple Consulting ticker.
According to the GEGP S-1 filing in 2010 they hired an Investors Relation Consulting in April of 2007. They don't name the consultant in the S-1 filings, but terms of employment read extremely similarly to all of Big Apple's consulting contracts.
Here is a bit of scam trivia for the board, Guy M. Jean-Pierre was working under a cooperation agreement with the FBI when he forged over 100 legal opinions.The billions of shares of stock that hit the public markets in approximately 15 issuers was done while he was under the thumb of the FBI.
What is even more interesting is that Gut Jean-Pierre was in house for Belmont Partners/Joseph Meuse/ Marc Jablon. Can anyone count the number of issuers and investors impacted by this?
Complete corruption and the representatives of the FBI and DOJ should be investigated.
Joseph DiFrancesco teamed up with Michael Gibilisco [MG Studios] in recent years on something called IZON-- "glasses free 3D TV." They set about trying to get all sorts of tax credits and grants to set up a factory in Florida. The promise was they would hire dozen's of people in the area too manufacture TV's (despite the fact that no TV's are made in the USA anymore). http://articles.orlandosentinel.com/2013-09-10/news/os-izon-3d-tv-seminole-20130909_1_incentives-tvs-televisions
The two go way back https://www.sec.gov/Archives/edgar/data/1414295/000114420410049556/v196782_8k.htm
They were running this virtual venture from Gibilisco's old place in Longwood, FL.
Gibilisco was a longtime partner/ crony of Marc Jablon aka BIG APPLE CONSULTING. Together they ran (manipulated) 3D EYE SOLUTIONS aka 3D 3ENTERTAIMENT HOLDING [TDEY]. The IZON board also includes Jablon's SEC convicted co-defendant Dominic Crain.
This is interesting. This was the last filing by Big Apple client, Made in America before it was suspended. It used Richard Rossi’s phone number at Equity Technology for that of the company.
Joseph AKA Joey DiFrancisco did a lot of deals with Big Apple and Richard Rossi.
Why is it Richard Rossi constantly shows up when someone is allegedly threatened?
United States District Court, M.D. Florida.
Jacques DANON, Plaintiff,
MADE IN AMERICA ENTERTAINMENT, INC. f/k/a Raven Moon Entertainment, Inc, a Florida corporation, and Joseph DIFRANCESCo, Defendants.
May 19, 2009.
Plaintiff's Renewed Dispositive Motion for Summary Judgment and Incorporated Memorandum of Law
Edward M. Baird, Esquire-trial Counsel, Florida Bar Number: 0498629, Mark T. Snelson, Esquire, Florida Bar Number: 783021, Wright, Fulford, Moorhead & Brown, P.A., 145 North Magnolia Avenue, P.O. Box 2828, Orlando, Florida 32802-2828, (407) 425-0234 (Phone), (407) 425-0260 (Fax).
COMES NOW the Plaintiff, JACQUES DANON, by and through his undersigned counsel, and pursuant to Rule 56, Federal Rules of Civil Procedure, and Local Rule 3.01, files this Renewed Dispositive Motion for Summary Judgment and Incorporated Memorandum of Law, and states the following in support:
1. This is an action brought by Plaintiff to recover amounts due and owing from Defendant MADE IN AMERICA ENTERTAINMENT, INC. f/k/a RAVEN MOON ENTERTAINMENT, INC. (“RME”) pursuant to a contract entered into by the parties titled “Securities and Proceeds Investment and Distribution Agreement.” In addition, Plaintiff alleges that Defendant JOSEPH DIFRANCESCO (“DiFrancesco”), RME's President, personally guaranteed RME'S contractual payment obligations to Plaintiff pursuant to a Personal Guaranty. The principal amount alleged to be owed from Defendants to Plaintiff is $493,979.33.
2. Plaintiff filed its original Dispositive Motion for Summary Judgment and Incorporated Memorandum of Law, and all factual support, on February 10, 2009. [Doc. Nos. 20–24]. Defendants asked for a continuance on the original motion to conduct discovery. [Doc. No. 25]. Thereafter, this Court issued an Order denying the original motion, but granting Plaintiff leave to refile upon the close of discovery. [Doc. No. 26]. The discovery deadline was May 1, 2009.
UNDISPUTED MATERIAL FACTS
3. Defendant RME is a Florida corporation with its principal place of business in Longwood, Seminole County, Florida. See Amended Complaint, ¶ 3 [Doc. No. 12]; Defendants' Answer and Affirmative Defenses to Amended Complaint, ¶ 3 [Doc. No. 14].
4. On or about August 12, 2008, RME changed its name to MADE IN AMERICA ENTERTAINMENT, INC. See Amended Complaint, ¶ 4; Defendants' Answer and Affirmative Defenses to Amended Complaint, ¶ 4.
5. Defendant DiFrancesco is a resident of the State ofFlorida, and is sui juris. See Amended Complaint, ¶5; Defendants' Answer and Affirmative Defenses to Amended Complaint, ¶ 5. At all times material to this cause, DiFrancesco was the President of RME. SeeAmended Complaint, ¶ 19; Defendants' Answer and Affirmative Defenses to Amended Complaint, ¶ 19.
6. On or about August 2,2007, Plaintiff and RME entered into a written contract titled “SECURITIES AND PROCEEDS INVESTMENT AND DISTRIBUTION AGREEMENT” (hereinafter “Agreement”). A true and correct copy of the Agreement is attached to the Amended Complaint as Exhibit “A.” See Amended Complaint, ¶10; Defendants Answer and Affirmative Defenses to Amended Complaint, ¶10.
7. Attached to the last page of the Agreement is a Personal Guaranty executed by DiFrancesco. See Amended Complaint, ¶ 20; Defendants' Answer and Affirmative Defenses to Amended Complaint, DiFrancesco's Answers to Interrogatories, #10 [Doc. No. 23]; Transcript of March 30, 2009 Deposition of Joseph DiFrancesco (hereinafter “DiFrancesco Depo.”) 12:18 –13:4; 44:17 –45:4 [Doc. No. 45].
8. Pursuant to the Agreement RME was obligated to make periodic payments to Plaintiff for a total amount equal to the “Total Net Proceeds,” as that phrase is defined by the Agreement. See Amended Complaint, ¶ 11;endant Defenda Answer and Affirmative Defenses to Amended Complaint,¶11.
9. RME was obligated to pay Plaintiff fifty percent (50%) of the outstanding “Total Net Proceeds” on or before February 15,2008. SeeAmended Complaint, ¶ 14; Defendants' Answer and Affirmative Defenses to Amended Complaint, ¶ 14.
10. The full amount of the “Total Net Proceeds” became due to Plaintiff on or about September 15, 2008. See Amended Complaint, ¶ 15; Defendants' Answer and Affirmative Defenses to Amended Complaint, ¶15.
11. RME has only paid Plaintiff a total of $35,000.00 pursuant to the Agreement. See RME'S Answers to Interrogatories, #6 [Doc. No. 24]; DiFrancesco Depo. 16:1 –17:17.
12. DiFrancesco, personally, has made no payments to Plaintiff. See DiFrancesco's Answers to Interrogatories, #7.
13. On July 3,2008, Plaintiff provided written notice to RME and DiFrancesco of their respective defaults under the Agreement and Personal Guaranty. See Affidavit of Danon, ¶ 4 [Doc. No. 21].
14. Plaintiff has realized only $6,020.67 from sales of escrowed RME stock. See Affidavit of Danon, ¶ 5.
15. Plaintiff has paid $19,615.00 in margin interest on his UBS account. See Affidavit of Danon, ¶7.
16. Prior to the Effective Date of the Agreement, Plaintiff had incurred $39,664.50 in attorney's fees related to the business transactions between Plaintiff and Defendants. See Affidavit of Danon,¶7.
17. At the time it entered into the Agreement, RME's intent was to comply with its terms. See DiFrancesco Depo. 67:1-4, 68:23 –69:15.
18. DiFrancesco has never contacted Plaintiff to repudiate the Personal Guaranty which he alleges was procured through duress. SeeSecond Affidavit of Danon, ¶ 4 [Doc. No. 44]; DiFrancesco Depo. 21:17 –22:4.
19. RME has asserted only one Affirmative Defense in this action; Plaintiff's alleged failure to mitigate his damages. DiFrancesco has joined in that defense, and has also asserted two other Affirmative Defenses; (1) the Personal Guaranty lacked consideration, and (2) the Personal Guaranty was executed under duress. See Defendants' Answer and Affirmative Defenses to Amended Complaint.
MEMORANDUM OF LAW
I. Plaintiff is Entitled to a Motion for Summary Judgment Against RME
A. RME's Material Breach of the Agreement
RME materially breached the Agreement by failing to make required payments to Plaintiff. Article 1.2 B of the Agreement reads as follows:
Investor Upside: Total Net Proceeds. [Plaintiff is] to be paid, from the escrow disposition as aforesaid, monthly, as available, payments for a total amount equal to the Total Net Proceeds. Total Net Proceeds shall not be reduced by Escrow Agent-related fees, brokerage commissions and/or other charges, if any, as such will be borne by [RME].
Each month following the first month net proceeds are recognized and due, by the 10th day of the month, the wire payment shall be made by the Escrow Agent to [Plaintiff], as stated herein, of the net proceeds.
“Total Net Proceeds,” which shall be documented and identified to the Escrow Agent as soon as practicable, shall be an amount of no less than $400,000 and no more than $500,000 and shall be calculated as follows:
-the sum of $360,000
- plus attorney fees of the [Plaintiff] paid or accrued (to be confirmed in writing to [RME]) on or prior to the Effective Date,
- plus an amount equal to 15% per annum (simple interest) on the unpaid portion of the principal amount of $360,000 for the period of time between July 24, 2006 and the date the [Plaintiffhas] received $360,000 from the Escrow Agent or from [RME],
- plus an amount equal to the margin interest paid (to be confirmed in writing to [RME]) by [Plaintiff] on the [Plaintiff's] existing UBS brokerage account (“UBS Account”) (upon the date [Plaintiff] receives in aggregate $360,000 from [RME], Escrow Agent and or Personal Guarantor pursuant to this Agreement and/or the Guaranty attached hereto, no further margin interest shall be reimbursed to [Plaintiff] by [RME]).
The section immediately subsequent, Article 1.2 C, states as follows:
Company Upside; Company Benefit Disposition.
1. [Plaintiff] shall be paid the Total Net Proceeds notwithstanding if the escrow fails to generate sufficient net proceeds, so if there is a deficiency of net proceeds from the escrow, the [Plaintiff] shall be due, and shall have the right to demand and collect the deficiency from [RME]. [RME] guarantees that [Plaintiff] shall receive Total Net Proceeds pursuant to the following schedule: (i) if the [Plaintiffhas] not been paid, from [RME] and/or the escrow, at least 50% of the figure that is the Total Net Proceeds amount due within the six month period starting from August 15, 2007, then the deficient amount (difference between 50% of the figure of Total Net Proceeds due and actual paid Total Net Proceeds plus any [RME] payments to [Plaintiff] during said six months) shall be due and payable within 30 calendar days from the expiration of said six months (30 days being to allow time for calculation and reconciliation by [RME] of the amounts paid and due) and upon payment any Securities in escrow up to half of the original amount in escrow shall be forfeited to the Company for cancellation or disposition as in the case of the end of the escrow as detailed below; and
2. At the end of 12 months from August 15, 2007, the same shall apply as to any deficiency as to the unpaid Total Net Proceeds, being that the deficient amount (difference between the figure of Total Net Proceeds and actual paid Total Net Proceeds plus any [RME] payments during said 12 months) shall be due and payable within 30 calendar days from the expiration of said 12 months (30 days being to allow time for calculation and reconciliation by [RME] of the amounts paid and due) and upon payment any Securities remaining in escrow shall be forfeited to [RME] for cancellation or disposition as in the case of the end of the escrow as detailed below; and,
3. [RME] shall pay the sum of $35,000 to the [Plaintiff] to be applied to the obligation of the Total Net Proceeds as follows: $25,000 within 10 business days of the Effective Date and $10,000 within 40 calendar days of the Effective Date.
During the said first six months, any excess payments to the [Plaintiff], if the Total Net Proceeds remain due and unpaid, shall be carried forward and paid to the Plaintiff and credited to the obligation of [RME] for the second six months.
According to Article 1.2 B, the Total Net Proceeds payable to Plaintiff was capped at $500,000, even if the actual calculation proved higher. The Total Net Proceeds calculation as applied to Plaintiff pursuant to Article 1.2 B is as follows:
•The “sum of $360,000,” together with 15% per annum simple interest on the unpaid portion thereof;1
• Plus $39,664.50 for Plaintiff's attorneys' fees paid or accrued on or prior to the Effective Date of the Agreement;
• Plus $ 19,615.00 in margin interest paid on Plaintiffs UBS account.
This calculation pushes the Total Net Proceeds over $500,000, putting the cap into effect.
Plaintiff has realized only $6,020.67 from the sales of the escrowed shares of RME stock. Subtracting this amount from the $500,000 cap leaves a balance of $493,979.33.
Pursuant to Article 1.2 C, paragraphs 1 and 2, fifty percent of the $493,979.33 balance ($246,989.66) was due from RME to Plaintiff by February 15, 2008, and the remaining fifty percent was due from RME to Plaintiff by September 15, 2008. Neither payment was made and, pursuant to Article 2.9 E of the Agreement, Plaintiff provided RME with written notice of its default on July 3, 2008.
“ ‘Where the determination of the issues of a lawsuit depends upon the construction of a written instrument and the legal effect to be drawn therefrom, the question at issue is essentially one of law only and determinable by entry of summary judgment’.” Barnes v. Diamond Aircraft Industries, Inc., 499 F.Supp.2d 1311, 1315 (S.D. Fla. 2007), quoting Angell v. Don Jones Ins. Agency, Inc., 620 So.2d 1012, 1014 (Fla. 2d DCA 1993). The amounts paid by RME to Plaintiff pursuant to the Agreement are undisputed. Therefore, liability related to the remainder of the Total Net Proceeds due to Plaintiff is an issue of law to be determined from the terms of the Agreement.
The unambiguous terms of the Agreement provide for a total of $500,000 to be paid to Plaintiff on the schedule recited above.
The elements of a breach of contract action are supported by the undisputed record facts; RME and Plaintiff entered into a valid contract (the Agreement) that RME intended to comply with, RME materially breached the contract by failing to pay the Total Net Proceeds to Plaintiff, and, by not receiving the money he is contractually entitled to, Plaintiff has suffered damages. See Beck v. Lazard Freres & Co.,LLC, 175 F.3d 913, 914 (11th Cir. 1999) (holding the elements of a breach of contract action under Florida law are (1) a valid contract; (2) a material breach; and (3) damages); Abbott Laboratories, Inc. v. General Electric Capital, 765 So.2d 737, 740 (Fla. 5th DCA 2000).
B. RME's “Affirmative Defense”
RME's lone “Affirmative Defense,” Plaintiff's alleged failure to mitigate his damages, is supported by RME with a single set of alleged facts:
Plaintiff failed to mitigate its damages, if any, by, among other things, failing to bring action against Raven Moon at the time the alleged breach occurred. Instead, Plaintiff waited more than six (6) months to pursue recovery against Defendant for Plaintiff's alleged losses, during which time, Raven Moon's ability to repay Plaintiff diminished. (emphasis added).
See RME's Answers to Interrogatories, #9.2 This is certainly a novel argument to support a “failure to mitigate” defense, and is not supported by legal authority. The mitigation of damages or “avoidable consequences” doctrine in Florida was described by the Third District Court of Appeal in Winter v. American Automobile Association, 149 So.2d 386,387 (Fla. 3d DCA 1963), wherein the Court stated:
In an action on a contract, if a plaintiff [by reasonable exertion of care] can prevent damages resulting to him by reason of the defendant's wrongful acts, it is his duty to do so, and, so far as he can thus prevent them, he cannot recover therefor.
Taken logically, RME's argument would require a plaintiff to file suit immediately upon a breach of contract, negligent act, or violation of law. According to RME, if a plaintiff fails to bring suit immediately, then he has failed to mitigate his damages if, by circumstance, the defendant's financial circumstances worsen by the time the plaintiff does actually bring suit.3 RME's argument would unreasonably require a plaintiff to; (1) thoroughly investigate the defendant's financial condition at the moment the contract is breached, and (2) forecast whether the defendant's financial condition will improve or decline going forward. This is not an example of the “reasonable exertion of care” described by Winter. Plaintiff has scoured the governing case law and cannot find a case which supports the novel argument put forth by RME.
Although RME's mitigation defense is not supported by law, it evidences RME's liability to Plaintiff. The crux of the argument is that RME's “ability to repay Plaintiff diminished” between the date of the breach and the date Plaintiff filed suit. Such an argument impliedly concedes there is a duty to “repay Plaintiff' in this case, and that there was, at least at one time, an ability on the part of RME to “repay Plaintiff” This begs the question, if RME had an ability to pay Plaintiff the amounts set forth in the Agreement, and its only affirmative defense is an alleged post-breach failure by Plaintiff to mitigate its damages, why did RME fail to pay Plaintiff on the schedule imposed by the Agreement, especially in light of DiFrancesco's testimony that RME intended on complying with the terms of the Agreement? DiFrancesco Depo. 67:1-4; 68:23 – 69:15.
The Total Net Proceeds due to Plaintiff from RME total over $500,000, and, thus, the total amount due is capped at $500,000. Plaintiff has obtained $6,020.67 from the sale of escrowed RME stock and, subtracting that amount from the $500,000 limit leaves a $493,979.33 balance. RME contractually agreed to pay the balance due in fifty percent installments, with the first being due on February 15, 2008, and the second being due on September 15, 2008. RME defaulted under the Agreement by failing to make either payment, and Plaintiff has suffered damages as a result of the default. RME's only so-called “affirmative defense” to its breach of contract is not recognized by Florida law.
II. Plaintiff is Entitled to a Motion for Summary Judgment Against DiFrancesco
A. DiFrancesco's Material Breach of the Personal Guaranty
The Personal Guaranty executed by DiFrancesco and attached to the Agreement states, in full:
THIS GUARANTY is made by the undersigned officer of Raven Moon Entertainment, Inc. (“Company”) in his personal and individual capacity (“Personal Guarantor”).
In consideration of the execution of the above Agreement between Company and Investors, and provided the Investors are not in breach of the Agreement, Personal Guarantor hereby certifies and attests that he personally guarantees the payment of the amounts owed by the Company to the Investors as stated above in the event of non-payment of such amounts when due by the Company, or material breach of any guarantee(s) made by the Company to the Investors pursuant to the Agreement. Personal Guarantor represents and warrants that he has not taken and will not take any actions to transfer his assets that would reduce his ability to honor his guarantee hereunder to the Investors.
As established above, RME failed to pay amounts owed to Plaintiff pursuant to the Agreement. Additionally, DiFrancesco admits that he has not personally made any payments to Plaintiff since the execution of the Agreement. See DiFrancesco's Answers to Interrogatories, #7. Therefore, DiFrancesco has violated the terms of the Personal Guaranty.
B. DiFrancesco's Affirmative Defenses
DiFrancesco has asserted three (3) Affirmative Defenses to Plaintiff's action on the Personal Guaranty. First, he argues that the Personal Guaranty is unenforceable because he “derived no bargained for legal benefit or determinant in exchange for his execution of the guaranty.” See Defendants' Answer and Affirmative Defenses to Amended Complaint. Second, DiFrancesco asserts that the Personal Guaranty is unenforceable because it was executed under offensive pressure, threats and duress. Finally, DiFrancesco joins in the mitigation defense plead by RME. DiFrancesco's first two defenses will be addressed, in turn. Plaintiff's response to the mitigation defense included in the discussion of RME's affirmative defense similarly applies to DiFrancesco's joinder in the defense, and Plaintiff incorporates that response herein.
DiFrancesco argues that he did not personally derive any “bargained for legal benefit or determinant in exchange for his execution of the guaranty.” See Defendants' Answer and Affirmative Defenses to Amended Complaint. However, whether DiFrancesco received any direct personal benefit in exchange for the execution of the Personal Guaranty is immateria.4 “[W]here the promise of a guarantor is shown to have been given as part of a transaction that included the creation of the guaranteed obligation, the consideration supporting the obligation will also support the contract of guaranty.” Dunser v. Southeast First National Bank of Miami, 367 So.2d 1094, 1095 (Fla. 3d DCA 1979); see also Texaco, Inc. v. Giltak Corp., 492 So.2d 812, 814 (Fla. 1st DCA 1986) (holding “when principal and guarantee contracts are executed as part of the same transaction, the consideration supporting the principal contract also supports the guaranty”). Therefore, the Personal Guaranty is enforceable even if no direct consideration was given personally to DiFrancesco according to Dunser and Texaco, Inc.
In Dunser, a bank sued a husband, the maker of two promissory notes in the bank's favor, and a wife, the guarantor of the notes. 367 So.2d at 1095. The wife argued that her guaranty was not supported by consideration given personally to her. Id. Despite the defense, the trial court entered summary judgment in favor of the bank. Id. The wife appealed, again arguing that her promise of guaranty was not supported by consideration. Id. The Third District Court of Appeal held that the defendant's argument was “without merit” and stated that “the law is clear that where the promise of a guarantor is shown to have been given as part of a transaction that included the creation of the guaranteed obligation, the consideration supporting the obligation will also support the contract of guaranty.” Id.
According to DiFrancesco himself, “[t]he Personal Guaranty was executed in conjunction with the Agreement” and “[t]he two documents were executed simultaneously.” See DiFrancesco's Answers to Interrogatories, #10, 11 (emphasis added). Therefore, pursuant to Dunser and Texaco, Inc., if the promises contained in the Agreement are supported by consideration, then so is DiFrancesco's guaranty.5 To that end, the following acknowledgement is stated on the first page of the Agreement:
The [Plaintiff] and [RME] confirm all terms and conditions stated herein; therefore: In consideration of the premises and the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Investors hereby agree as follows: (emphasis added)
In addition, Article II of the Agreement is a section devoted entirely to “REPRESENTATIONS AND CERTAIN PROMISES OF THE INVESTORS.” The Agreement is unambiguous and it reflects specific consideration flowing to RME for its promises and guarantees. Additionally, in Article 2.9 of the Agreement, Plaintiff makes agreements and promises “to the Company and Personal Guarantor.”Under the authority of Dunser and Texaco, Inc., the Personal Guaranty is supported by consideration, and DiFrancesco's defense must fail.
DiFrancesco also affirmatively defends Plaintiff's action on the Personal Guaranty on grounds of duress. See Defendants' Answer and Affirmative Defenses to Amended Complaint. In particular, he argues that the Personal Guaranty was executed under “offensive pressure exerted on DiFrancesco from the Plaintiff Danon. Specifically, Danon threatened the health, safety and well being of DiFrancesco prior to DiFrancesco signing the Personal Guaranty, and, but for this duress, DiFrancesco would not have signed the Personal Guaranty.” See Defendants' Answer and Affirmative Defenses to Amended Complaint.
Plaintiff's interrogatories to DiFrancesco asked him to “specify each and every instance which Danon threatened the health, safety and well being of DiFrancesco prior to DiFrancesco signing the personal guaranty.” See DiFrancesco's Answers to Interrogatories, #4. In response, DiFrancesco identified only two (2) instances of alleged duress-causing threats made by Plaintiff, an August 9, 2006, phone conference between Plaintiff and DiFrancesco, and an unidentified email from Plaintiff to Plaintiff's own attorney that DiFrancesco cannot produce. See DiFrancesco's Answers to Interrogatories, #4.
The alleged August 9, 2006, phone conference could not have produced the duress in DiFrancesco causing him to execute the Personal Guaranty because the alleged phone conference happened approximately one year before the Personal Guaranty was negotiated through counsel and executed. See DiFrancesco's Answers to Interrogatories, #4, 10. The following excerpts from the deposition of DiFrancesco sheds light on the substance of this lone alleged phone conference between Plaintiff and DiFrancesco:6
A: So when Mr. Danon called me, I didn't know anything about the warrants should have been registered. I had no clue. Okay. Grocock was still our attorney. And so when he called me, I said–you know, he called, I need to get the money back. And I go – I need to return the stock. So I said – I said, well, when did you purchase it? He says, well, you know its been a while now. So we looked it up and it was like 21 days later. I said, I'm sorry Mr. Danon, you can't rescind a deal because it's 21 days later. And he blew up into a rage and started to get – now, I was on the speakerphone and I just took it into the handset.
A: Okay. So then, you know, that was an issue. And he got a little heavy, you know, with me. I'm going to get you, I'm going to get your company and all that. And I'm like, okay.
Q: Let me stop you there. On that phone call where you said he got enraged and you picked up the speakerphone –
Q: I notice in your answer to this interrogatory you talk about how he said he'd get you or get him, is the actual quote, and get all of you
Q: Referring to those associated with Raven Moon. Is that all specifically he said – let me ask you this: Did he ever threaten bodily harm on you specifically?
A: Okay. He was cursing, he was using– was talking in French and English. Okay?
Q: Do you speak French?
A: So I – the answer to your question is, I don't think so, no.
A: You know, because – I mean, I couldn't – all I knew at that point was I have a madman on the other line and, I'm – you know, I'm sorry, I can't do anything for you.
Q: How long did that conversation last?
A: I mean, it wasn't that long. It was – because I – when he called, you know, we pulled the warrant and looked at it. It had a medallion guaranty on it from the broker. In other words, it was like perfectly executed. It wasn't, you know – and so maybe three minutes.
Q: Okay. And does that include the time he was on speakerphone and the time you picked up?
A: Yeah. I mean, I'm really guessing three minutes. Could have been four, five minutes.
Q: Sure. Less than ten
A: Oh, yeah.
DiFrancesco Depo. 28:2 - 30:5;
Q: So you don't – that less than ten-minute phone call, we'll see, you don't ever – and I understand you don't speak French and if he was speaking French, you wouldn't know what he was saying, but you don't ever specifically recall him threatening you bodily harm?
Q: Did he threaten anyone that you work with or anyone in your family with bodily harm?
A:Just the reference to I'll get all of you.
DiFrancesco Depo. 30:17 –31:1;
Q: Do you recall anything more – do you recall any other specifics of the threatening nature of the phone call other than his, quote, I'll get you, I'll get all of you, and the fact that he was saying it in a loud voice?
A: A loud voice, in French, in English. Maybe he said something in French. I have no idea.
A: You know, but I can't say, Joey, I'm going to kill you.
Q: He didn't say that obviously
DiFrancesco Depo. 31:13-24.
The only other instance that DiFrancesco argues constitutes coercive conduct is an alleged threat contained in an email from Plaintiff to Plaintiff's former counsel, William Uchimoto, Esquire. See DiFrancesco's Answers to Interrogatories, #4. DiFrancesco states that the email was “forwarded to Richard Rossi, Esq. (former counsel for DiFrancesco), but not to DiFrancesco. However, DiFrancesco was made aware of the threat.” See DiFrancesco's Answers to Interrogatories, #4. DiFrancesco, despite being specifically asked in the interrogatory, does not identify the date of the email, the date he “was made aware of the threat” in the email, or the substance of the alleged “threat.” See DiFrancesco's Answers to Interrogatories, #4. DiFrancesco also admits he does not possess a copy of the alleged email. See DiFrancesco's Answers to Interrogatories, #4.
It is imperative to note that Plaintiff did not make the alleged email threat directly to DiFrancesco. To the contrary, as explained by DiFrancesco, the alleged threat was transmitted in an email from Plaintiff to his own counsel. Plaintiff's counsel then allegedly forwarded the email to DiFrancesco's counsel. There is no indication that DiFrancesco actually received the purported email containing the alleged threat. DiFrancesco only indicates that he “was made aware of the threat.” Therefore, the alleged threat or coercive statement was transmitted to DiFrancesco in a highly indirect manner, if at all.7 The following excerpts from the deposition of DiFrancesco are enlightening in this regard:
Q: Staying with interrogatory number four, and we'll go to the second paragraph of your answer, you talk about a threat contained in an email, William Uchimoto acknowledged an email threat sent to him directed towards DiFrancesco, which he referred to Richard Rossi, Esquire, but not to DiFrancesco; however DiFrancesco was made aware of Danon's threat. Did you ever receive the email that's being referred to?
Q: Do you know what specifically it said
A: All I know is that Danon was totally bent out of shape and made threats, quote – this is Richard Rossi telling me, threats, derogatory remarks, I mean, anything he can throw into a pot and say against me or the company, et cetera.
Q: Okay. But Mr. Rossi didn't tell you the specific wording of the threats, what they entailed
A: (Shakes head.) He said he was going to get me a copy of it, but he never did.
Q: To this day, have you ever seen a copy of the email
A: It's like the magic bullet; it has disappeared somewhere.
Q: Okay. Have you asked Mr. Rossi if he– MR. DEERY: Just for the record, that's a no, you've never seen it?
A: Yes. Yes, no. The answer is no.
DiFrancesco Depo. 38:7 – 39:10;
Q: Okay. Is it your understanding that this is an email that my client sent to his attorney, Mr. Uchimoto and Mr. Uchimoto then forwarded it to Mr. Rossi
A: Yeah and – because Richard Rossi, I specifically recall, said, I have no idea why Bill Uchimoto sent this to me to show the characterize (sic) of his client to me.
DiFrancesco Depo. 39:19–40:1.
“Duress is a condition of mind produced by improper external pressure that destroys the free agency of the party compelled to act in a manner not of his or her own volition.” Smith v. The Paul Revere Life Ins. Co., 998 F.Supp. 1412,1416(S.D.Fla. 1997) (holding also that whether duress was suffered can be determined through summary judgment). Florida law requires that two factors coexist in order to set aside a contract on grounds of duress. Peralta v. Peralta Food, Corp., 506 F. Supp.2d 1274,1280 (S.D. Fla. 2007). First, “it must be shown that the act sought to be set aside was effected involuntarily and thus not as an exercise of free choice or will.” City of Miami v. Korv 394 So.2d 494,497 (Fla. 3d DCA 1981); Peralta, 506 F.Supp.2d at 1280. Second, the “condition of mind was caused by some improper and coercive conduct of the opposite side.” City of Miami, 394 So.2d at 497 (emphasis added). In order for a duress defense to lie, “the act supposedly coerced must be caused by some improper or illegal conduct” by the opposite party. Id. at 498 (emphasis added); G.E.E.N. Corp. v. Southeast Toyota Distributors, Inc., 1994 WL 695364 *5 (M.D. Fla. 1994).
DiFrancesco cannot meet the first factor required for a duress defense; “it must be shown that the act sought to be set aside was effected involuntarily and thus not as an exercise of free choice or will.” City of Miami, 394 So.2d at 497. According to DiFrancesco himself, the negotiations pertaining to the Personal Guaranty, which were done “strictly between” the parties' respective counsel, did not begin until July 2007, approximately eleven (11) months after the alleged August 9, 2006 phone conference. See DiFrancesco's Answers to Interrogatories, #10. In the span of time between the alleged phone conversation and the execution of the Personal Guaranty, DiFrancesco consulted with his counsel, negotiated the terms of the Agreement and Personal Guaranty through his counsel, and approved both the Agreement on behalf of RME and the Personal Guaranty as evidenced by his execution of same. See DiFrancesco's Answers to Interrogatories, #4,10, and 11.
“When ‘a particular course of action is raised by one's own volition, and is finally decided upon in a deliberate and considered choice between alternatives, no finding of involuntariness, and thus no conclusion of duress may be sustained’.” Peralta, 506 F.Supp.2d at 1281, quoting City of Miami, 394 So.2d at 497-498. In DiFrancesco's Answers to Interrogatories, #10, he states the following in discussion of the Personal Guaranty and the alleged coercive threats:
Specifically, negotiations pertaining to the Personal Guaranty occurred strictly between Richard R. Rossi, Esq. and William Uchimoto, Esq. DiFrancesco ultimately signed the Personal Guaranty under duress. Specifically, William Uchimoto, Esq. conveyed to Defendant's attorney, Richard R. Rossi, Esq., threats were made by Danon regarding DiFrancesco. By executing the Agreement and Personal Guaranty, DiFrancesco believed he could temporarily appease Danon's anger at Raven Moon and DiFrancesco for not allowing Danon to rescind his purchase of the stock, which he thought to be unrestricted, and to avoid any possible aggression by Danon against DiFrancesco. DiFrancesco hoped to resolve all issues with Danon during the one-year period contemplated by the Agreement and Personal Guaranty, including, but not limited to, selling all stock held by Danon. The Personal Guaranty was executed in conjunction with the Agreement.
(emphasis added). In the interrogatory answer DiFrancesco admits that he made a deliberate decision to execute the Personal Guaranty upon the belief that doing so would appease Plaintiff's alleged anger and allow him a one year period to “resolve all issues with Danon.” Such a reasoned decision cannot be considered an involuntary action obtained through coercive conduct. DiFrancesco testified about this topic as follows:
Q: In entering into the contract and the personal guaranty, is that correct, was it your plan to work out all the issues – first of all, let me ask you this: Is it your understanding of the contract that it gives you a certain amount of time to pay money, essentiall? Right?
A: Well, if you want to know what that means, that particular thing – all right –first. He received two billion shares of stock. Okay? The plan was he would receive $35,000 up front on the execution of the agreement and then they wanted to select a –an independent agent to be the escrow agent of the stock. And then Bill Uchimoto has a friend at a brokerage firm that he said was a very good broker and that the agent and the broker would then be selling Mr. Danon's stock. So that reference – in other words, like –obviously, it didn't happen, but the thought was you know, Mr. Danon would sell enough shares of stock during the one-year period to pay the first part of the – of the due bill of the contract.
Q: That was your plan?
A: Well, that was my hope.
Q: Okay. Did you take that hope into account when you executed the personal guaranty
A: Well, it was one of the things that Rossi said. He – you know, they're setting this up, he could very well sell the stock, but, you know, I mean, look, at that point, as I said, I was totally confused. I was – you know, I was hoping for the best of anything at that point. I didn't – I would hang my hat on the fact that, you know, he was going to sell it all.
DiFrancesco Depo. 42:1 – 43:8.
Further deposition testimony shows that DiFrancesco; (1) had previously refused to sign the Personal Guaranty on several occasions, (2) considered the consequences of not signing the Personal Guaranty prior to execution, (3) was repeatedly advised by his attorney to sign the Personal Guaranty, and (4) had a plan to “win the war” by “investigating” Plaintiff during the repayment period. DiFrancesco Depo. 93:4–93:22; 90:23–91:15; 44:17 – 45:4; 23:7–24:5; 104:17-105:10.
Assuming, arguendo, that the alleged email exists and contains a threat that was ultimately communicated to DiFrancesco, and that the alleged August 9, 2006 telephone conference wherein alleged threats were made actually took place, DiFrancesco's affirmative defense nonetheless fails to meet the first requirement for setting aside a contract on grounds of duress based upon his own responses to interrogatories and deposition testimony. As stated in Peralta, “it must be shown that the act sought to be set aside was effected involuntarily and thus not as an exercise of free choice or will.” Id. at 1280 (emphasis added). To the contrary, DiFrancesco admits to:
• Negotiating the terms of the Agreement and Personal Guaranty through his counsel;
? Formulating an independent belief and strategy in executing the Personal Guaranty;
? Hoping that Plaintiff would be able to sell his stock to obtain repayment;
? Considering the consequences to himself and his company in refusing to sign the Personal Guaranty;
? Refusing on several occasion to sign the Personal Guaranty;
? Formulating an independent belief that by executing the Personal Guaranty he would appease Plaintiff; and,
? Formulating a plan to investigate Plaintiff during the repayment period in an effort to “win the war.”
These admissions prove that DiFrancesco was not deprived of his free will in executing the Personal Guaranty, and, therefore, the defense of duress cannot lie as a matter of law. Id. at 1280–1281.
DiFrancesco also fails to meet the second prong of a duress defense; the duress must have been caused by some improper or illegal conduct of the opposite party. City of Miami, 394 So.2d at 497. DiFrancesco's deposition testimony reveals that, if he was under duress, the duress was caused by acts and omissions of his own attorneys, Richard Rossi and Ben Grocock, not by Plaintiff:[color=red][/color]
Q: Uh-huh. Okay. The phone call – the one phone call you did have with Mr. Danon from August of the previous year, August of '06 – were you still under duress from that phone call at the time you signed the personal guaranty, which was almost a year later?
A: The impact that he made during that phone call still resounded in my mind, but if I said a scale from one to 100, that registers about 20. The period just prior to me signing the personal guaranty registers at 95 on that same scale and – in other words, that was the beginning and then all of a sudden later on it starts to get really intense.
DiFrancesco Depo. 66:12-25;
Q: We spoke earlier –you said on a scale of zero to 100 –we're talking about the duress causing events - and you said at the time you signed the personal guaranty, the previous year's phone conference with Mr. Danon was maybe a 20 on that scale. Do you remember that testimony?
Q: Okay. And on the same scale, you said the constant barraging and pressure being put on you by Mr. Rossi was, what, a 90 or 95, I think you said?
A: Clarify.The barrage and pressure put on from Mr. Danon to Mr. Uchimoto to Mr. Rossi to me was like 95 percent.
Q: Okay. And you kind of segued into my next question. During that time frame where there was this pressure being put on to you from your attorney and it came from the other side and his attorney –
Q: - Mr. Danon or his attorney, Mr. Uchimoto, never directly contacted you during that time, did they, to put pressure on to get the deal done?
Q: Okay. It all came through your attorney
DiFrancesco Depo. 96:6–97:5;
A: And as far as the regulatory thing goes, you know, is concerned, I think that's a secondary issue and this point. The point is the pressure they were putting on –because the pressure that Danon was imposing on Bill Uchimoto and Bill Uchimoto was literally begging Richard Rossi, look, you've got the agreement, he's willing –they 're all willing to go. The only thing that he wants is Joey's personal guaranty, you know. I mean, that was the pressing thing.
Q: But you had said no before, correct, to the personal guaranty
A: When it was first mentioned to me, I said, are you crazy? Why am I signing a personal guaranty? It's a corporate thing, it's a company thing. Shouldn't involve me in it.
Q: Approximately how many times did you tell Mr. Rossi that you were not going to sign a personal guaranty?
A: I don't know.
Q: More than three?
A: It was a few times, because he kept saying that, look, we 've got this thing negotiated, it's going to cool down. And he goes, my brother is part of the FBI. I mean, that was a big issue to me. You know, we're going to find out who this guy is, we're going to have him detained, we 're going to have him investigated. Okay? Let him win the battle. We 're going to win the war. So, I mean, you know – I mean, you –it's like, you know, you keep badgering the person –and you know, again –you know, earlier I said to you I graduated high school. Barely. Barely. Okay.
DiFrancesco Depo. 92:19 - 94:1;
Q: Let me ask you this: Did Rossi ever say, Joey, I talked to Danon, he's a crazy man, saying I talked to him directly?
Q: On the flip side of that, did he tell you, this is what I heard from Uchimoto. Uchimoto's telling me Danon's mad, Uchimoto's telling me this, that and the other thing?
Q: Okay. So it's your understanding that Mr. Rossi's beliefs about Mr. Danon and his temper and his rage and all that were coming from Mr. Uchimoto?
A: Yes, the fact that he was like out of control and putting pressure on him.
Q: That's what Uchimoto was telling Rossi?
DiFrancesco Depo. 103:5-20. In addition, DiFrancesco testified that RME's former securities counsel, Ben Gro