Latest Fisher Court Brief. Quote: UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA KEY WEST DIVISION “IN ADMIRALTY” JTR ENTERPRISES, LLC, Plaintiff, vs. CLAWDB LLC, et al.. Intervening Plaintiffs, vs. CASE NO. 4:11-CV-10074-JLK AN UNKNOWN QUANTITY, etc., In Rem Defendant, vs. MOTIVATION, INC., Claimant. ___________________________________/ MOTIVATION’S REPLY TO JTR’S RESPONSE TO MOTION FOR SANCTIONS JTR’s response [Doc. 142] to Motivation’s motion for sanctions is, in the main, presented in two parts. In the first part, JTR strives to convince the Court that Motivation’s claim was without merit and, therefore, Motivation lacks standing to seek sanctions. Motivation addressed this tactic in its reply to its motion to compel discovery [Doc. 137] and motion to strike the response to the motion for sanctions [Doc. 151] and will refrain from rearguing Motivation’s right to bring the motion for sanctions and other alleged distractions. Motivation here addresses the second part of JTR’s response, i. e. JTR efforts to convince the Court that JTR Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 1 of 11
and its principals and counsel, have acted in good faith, not bad faith, and cannot be sanctioned for dilatory conduct and pleadings during the course of the litigation. The second part of JTR’s response is set forth in Bruce Silverstein’s affidavit [Exhibit U to the response: Doc. 142-21 and 22] and exhibits thereto. 1. Although JTR’s general counsel Bruce Silverstein’s affidavit convincingly acquits himself from directly participating in bad faith in the filing of the complaint, Exhibits M, N, O and P of his affidavit reveal that Silverstein and others involved in the strategy group for JTR assiduously undertook the task of damage control in order to stifle disclosure that JTR’s own Colombian expert and others had, at least as early as November 20111, refuted Jay Miscovich’s story that the emeralds were high quality gemstones from an ancient shipwreck site. 2. The core of Silverstein’s defense to the charge of maintaining the litigation in bad faith begins on paragraph 72 of his affidavit [Doc. 142-21, p. 31] where he states that on December 1, 2011, JTR had learned that the French and Swiss labs reported “enhancement material” but JTR had not yet received written reports. “Rather, all that JTR received at that date was an e-mail from an associate of David Horan’s in Colombia.” Silverstein then avers that JTR did not receive documents from either the French Lab or the Swiss Lab until February 12, 2012, and that “even then the recipient of the reports…described the documents as “raw reports” that they were not yet final.” While written reports might not have been prepared, what the JTR team had received were “raw-truth reports” from those labs which have never been contradicted. Silverstein avers in paragraph 73 that French and Swiss lab reports “came as a complete surprise to me.” [Doc. 142-41, p. 31]. 1 If Silverstein had read the narrative given by Miscovich to Dr. Baer in August 2011, Silverstein should have, at least, wondered why Miscovich told Baer he found the emeralds while diving with 2 Mexican friends and been surprised that the story changed. [Doc. 94-7] Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 2 of 11
3. It is plain that the “associate of David Horan in Colombia” and the “Columbian mine owner” mentioned in various pleadings is Daniel de Narvaez McAllister since his name is mentioned in the French lab report appended to JTR’s Third Status Report. [See Doc. 82, p. 11] and elsewhere in Silverstein’s exhibits. McAllister had to have been the person who selected the samples from the Key West tranche and sent to the French lab on October 18 or 19, 2011, based upon Karen Horan’s notary seal. It had to have been McAllister who received the French lab’s “raw report” in November 2011 and, shortly thereafter, from the Swiss lab that all of the random samples sent contained modern day enhancements and oils and could not be from any ancient shipwreck as he had been led to believe was the case. The “new” stones collected from the ocean bottom on the 60 MINUTES dive in late October or early November 2011, were sent to the Swiss lab on November 9, 2011, by David Horan.2 4. Silverstein’s Exhibit N [Doc. 142-41, p. 7] shows that, as early as December 16, 2011, MacAllister wrote David Horan, Paul Sullivan and Greg Stemm3 [Doc. 142-41]: I endorse the decision taken to resend further samples to the GIA lab in New York but whatever kind of results they might produce, the European results so far are, in my view, by all technical standards, rock solid. In respect to determinations made so far is, in my view, nothing will change no matter what they discover or corroborate. I honestly believe that GIA should have tested for fillers when they tested the 200 samples they supposedly had to begin with, if for nothing else to dispel any suspicion of foul play in an otherwise awkward finding. If in the hypothetical case that no modern day fillers were to be found in the additional samples that will be sent to the GIA, this conceivably could be explained in several scenarios not having to do with the veracity of reliability of the tests so far performed in France or Switzerland. This having been said, I suggest we disclose 2 Both the French and Swiss reports determined that all samples had modern enhancements; the Swiss lab in testing the stones recovered on the 60 Minutes dive refused to submit a final report because the oils and epoxies were applied so heavily on some of the emeralds that their equipment could not determine origin accurately. Manuel Marcial noted the same evidence in the August 14, 2012, inspection witnessed by John Siracusa and David Horan [Doc. 119-1]. 3 Greg Stemm is the President of Tampa-based Odyssey Marine Exploration, a wellrespected, publicly traded commercial salvor with substantial experience in Spanish Colonial Era shipwrecks and recently involved in the Black Swan litigation with the Kingdom of Spain. Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 3 of 11
publicly very soon, tomorrow or the day after, publicly, the findings and leave the implications for others to determine. [Doc. 142-41, p. 7 of 7; Emphasis added] The JTR team had a “rock solid” report that they did not like before December 16, 2011. McAllister’s correspondence with Silverstein discloses that Silverstein did not follow McAllister’s advice about testing for “fillers” but, in any event, the GIA’s findings as reported to Greg Stemm and Paul Sullivan did not contradict the findings of the French and Swiss labs and was inconsistent with Jay’s story he told to 60 MINUTES in November 2011. 5. Silverstein’s reply on December 18, 2011, was to tell McAllister to stop trying to figure out the “mystery” of the ancient emeralds and how they came to be enhanced with modern day resins and oils.4 Silverstein also states that Paul Sullivan had forwarded him McAllister’s email and asked him to respond “because your e-mail touches on somewhat sensitive legal issues5 surrounding the ‘Emerald Project’” and “that CBS had been informed of the probable results from the French and Swiss labs shortly after you reported those results to Paul.” [Doc. 142-41, p. 3- 4 of 7]. McAllister reported the results to Greg Stemm and Paul Sullivan in late November 2011. The only GIA report disclosed to date, The GIA Summary Report dated January 17, 2012 [Doc. 131, Exhibit E], verified the reports of the French and Swiss labs. 6. By December 16, when McAllister emailed Horan, Sullivan and others [Doc. 142-41, pp. 6-7] to start the email-chain that comprises Exhibit N to Silverstein’s affidavit, McAllister urged public disclosure of the rock solid results of the European labs and knew that further 4 “While we appreciate your efforts to help solve this mystery, we request that you suspend your efforts until we learn more from the GIA.” [Doc. 142-41, p. 6 of 7] 5 Motivation wonders: What sensitive legal issues could exist at this point other than whether Sullivan and Silverstein were being defrauded, not to mention 60 Minutes and the public in general? Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 4 of 11
testing by GIA or any other lab would not result in a different result and would have no bearing on the fact that these emeralds were not from any ancient shipwreck. 7. In McAllister’s January 17, 2012, email to Horan, Sullivan and Silverstein [Doc. 142- 42, p. 3; Ex. O to Silverstein Affidavit], McAllister seeks instructions since, the last time he spoke to them, the Smithsonian emeralds had been sent to the GIA but he was never informed of the outcome of the GIA’s examination. JTR advisor Paul Sullivan, in his January 18, 2012, email to Odyssey Marine Exploration’s Greg Stemm [Doc. 142-42, p. 2], copies McAllister with a previous message that day from Stemm to Sullivan where Stemm advises Sullivan that 60 MINUTES told him that the GIA found the same results as the European labs. 8. Silverstein’s disclosures, limited as they are, explain why McAllister never prepared his report and also explain why JTR filed its Motion to Dismiss Motivation’s claim on December 1, 2011, and kept fighting Motivation’s Rule 34 request to inspect the emeralds; and, why JTR delayed bringing all of the emeralds into the jurisdiction of the Court despite an agreed order to do so and continues to resist producing its files and correspondence and shipping information. The production sought would confirm that JTR strove to prevent a disclosure that would contradict its fabricated story as related in the 60 MINUTES interviews in November 2011 and ensure it would not be exposed prior to the April 22, 2012, airing of the show. The filing of JTR’s Third Status Report on April 18 which included the February 8, 2012, French and the Matco revised lab report of April 17 was filed in time to make it appear JTR was being forthright with the court but too late for 60 MINUTES to change the script, e.g. Reporter Armen Keteyian’s statement to the public that the emeralds “were worth hundreds of millions of dollars and likely came from an ancient shipwreck.” Even so, this Status Report is a far cry from the disclosure McAllister argued for in December 2011. More tellingly, after Motivation’s expert examined the Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 5 of 11
emeralds on August 14, 2012, Motivation’s undersigned counsel informed JTR’s current lead counsel that Motivation would be filing a motion to dismiss its own claim and attach Manuel Marcial’s Report of his examination of the tranche of emeralds presented to him for inspection. JTR’s counsel responded that, if the Report was filed with the Court, JTR would file a previously threatened Rule 11 motion. See Exhibit 1 attached hereto which is a true copy of John Siracusa’s August 17, 2012, e-mail6. 9. In spite of Keteyian’s report of JTR’s claim of value and provenance, JTR argues that there is no allegation in the complaint that the emeralds were of an ancient origin; but, Keteyian report is what the public heard and what Motivation heard prior to filing its claim. The public also heard Miscovich tell Keteyian that, when he bought the map from his diver friend, the diver showed him an encrusted piece of pottery that Miscovich knew was “absolutely, 100 percent, a colonial era piece of pottery.” When asked by Keteyian why the identity of mysterious diver was secret, Miscovich said it wasn’t a secret but that there were legal agreements prepared by attorneys which documented the purchase of the map. [Doc. 123-4, p. 6]. By JTR’s own counsel’s admission, they are in possession of these documents but will not produce it nor evidence of the payment of the $50,000 [See, Doc. 134, p. 3, ¶ 3] unless Motivation executes a confidentiality agreement of unknown terms. 10. It is difficult for Motivation to understand how, as Silverstein avers in his affidavit [Doc. 142-21, p. 5, ¶10], that neither he nor the ten other attorneys in his firm could uncover any evidence that Jay Miscovich and Steve Elschlepp fabricated JTR’s claim. At least by December 1, 2011, when David Horan filed JTR’s motion to dismiss or for judgment on the pleadings, JTR’s lawyers ought to have at least been dubious under the circumstances that the French lab 6 Earlier, on October 21, 2011, David Horan wrote Motivation’s undersigned counsel and raised the specter of Rule 11 sanctions against Motivation (and, perhaps, its attorneys) because Motivation was challenging “our extensive work on the emeralds.” [Doc. 123-1, p. 5 of 19] Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 6 of 11
had rendered a “raw report” that the emeralds were enhanced and at least some emeralds were mined after 1999, that Jay Miscovich had untruthfully represented himself as a retired emergency room physician, that he had amassed tens of thousands of enhanced commercial grade emeralds mined in the 20th Century (some no earlier than 1999) but not immersed in seawater for more than a couple of months mixed in with a few dozen gem quality emeralds that had been immersed in seawater for hundreds of years and at least one colonial era pottery shard and civil war cannonball. Further, it should have been considered suspicious when, as part of the August 2010 Emerald Reef, LLC, transaction with the New York investors, Miscovich promised to deliver the coordinates of the Emerald Reef site in escrow to Emerald Reef’s general counsel but never did – even after promising a second time the next month. Then, later, the New York investors learn that 4 boxes of emeralds were stashed at 3 Go Lane in Key West even though Miscovich assured the investors that all of the recovered emeralds were stored in safe deposit boxes in New York. One of the New York investors (Neil Ash) checked the safe deposit box at Citibank in New York and found that what he assumed were the best emeralds had been removed by Jay Miscovich or never put in the box as promised by Scott Miscovich. 11. Moreover, to confirm a previous allegation, Peter Tobia, “a full-time consultant overseeing investor and public relations as well as other matters” for Oceanic Research & Recovery, Inc. (“ORRV”), received an equity interest in Emerald Reef, LLC, in April 2010 without contributing capital, along with ORRV’s president Scott Heimdel. Around June 2010, after attending a subcontractor meeting in Vero Beach with Steve Elsclepp, Tobia approached Brent Brisben who, through 1715 Fleet - Queens Jewels, LLC, owns the salvage rights off the Treasure Coast of Florida in the Vero Beach area formerly owned by Mel Fisher Center, Inc. [See S.D. Fla. Case No. 9:79-cv-08266-JLK] Tobia wanted Brisben to contract with him and Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 7 of 11
strongly implied that he could find a lot of emeralds in the 1715 Fleet “injuncted” salvage area but Brisben declined the offer. Brisben’s affidavit is attached hereto as Exhibit 2. JTR and its agents were looking for a place to “find” the modern era emeralds. When they finally determined the ideal place to find them7, the emeralds, or a portion of them, were dropped there and then recovered shortly afterward. The admiralty claim was then filed with the expectation that no party would file a claim and title to the find would be adjudicated, without a hearing, as being the property of JTR and the modern era commercial-grade emeralds would bask in the glory of the real Spanish Colonial era emeralds shown to the investors and to Jeffrey Post, Curator-in-Charge of the Smithsonian Institute’s Mineral Collection. 12. Miscovich told Dr. Robert Baer that he found the emeralds in early 2009 but Miscovich, unlike what he told 60 MINUTES , said he found the emeralds in 10 to 15 feet of water while diving with a couple of Mexican divers. According to the affidavit Kenneth Rose filed in the Delaware litigation [Doc. 94-11] between Miscovich and his investors, Miscovich told Rose that the emeralds were found in 10 to 15 feet of water; further, Rose told both Miscovich and Elschlepp where ancient anchors and artifacts could be found within his permit area. 13. Exhibit A to Bruce Silverstein’s affidavit [Doc. 142-23] is Dean Barr’s July 13, 2010, letter in which he says that Miscovich showed he and Jeffrey Post seven artifacts from Ken Rose’ concession. Under the Agreement for Exploration and Recovery in Arrest Site [Doc. 142- 36] between J&S Keys and the Kirby Group prepared by Silverstein, J&S (Jay Miscovich & Steve Elschlepp) agreed to adhere to the applicable federal regulations8 affecting the Kirby 7 The coordinates of the JTR verified complaint place the “find” some 2 miles beyond the 12-mile territorial sea and outside the FKNMS boundary. From the dealings of J&S Keys, LLC, on the Rose/Kirby Group Woman Key area, they knew of the onerous reporting and recovery requirements of NOAA in the Sanctuary. 8 See, e.g., 15 C.F.R. § 922.163(a)(9), 922.166(b) Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 8 of 11
permit site which make the unauthorized removal of historical objects from Florida Keys National Marine Sanctuary a federal crime. Motivation has learned that Rose terminated these agreements because of their failure to comply with, inter alia, the Sanctuary permits. One could reasonably infer that Miscovich did not want witnesses to what he and his diver friends were removing, e. g. ancient pottery shards and other relics, and never reported the finds to the Sanctuary or to Rose. 14. Motivation, since filing its July 11, 2012, Second Request for Production [Doc. 107- 1, p. 11] has been repeatedly demanding copies of “[a]ny and all analyses, assays, bills of laden, airbills, correspondence, drawings, inventories, logs, photographs, receipts, reports, studies and test results relative to all and any part of the gemstones….” JTR, however, has failed, among other things, to produce or allow Motivation to inspect the files JTR advised were located at the offices of Horan, Wallace & Higgins in Key West. These are a part of the documents Motivation has requested the Court to compel production. Motivation believes that the “raw truth report” made by McAllister and the French and Swiss labs in November 2011 was sufficient notice that the emeralds are far from remnants of an ancient shipwreck and that JTR and its attorneys were aware of such long before filing their Motion to Dismiss or for Judgment on the Pleadings. [Doc. 40] Motivation believes that JTR filed the motion, rather than allow Motivation to inspect the emeralds, in order that the true nature of the emeralds would not be exposed prior to the showing of the 60 Minute broadcast and, if they could get Motivation’s claim dismissed would never be disclosed. 15. Silverstein urges the Court to disregard the affidavit of Gerry Edwards because of a number of misdemeanors and a very shameful felony conviction 27 years ago. Edwards straightened out his life and has had no brush with the law in nearly three decades and, because Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 9 of 11
of his past, was subjecting himself to great embarrassment. His affidavit should not be disregarded, especially because the truth of it has not been challenged by JTR. Silverstein also urges the Court to disregard the affidavit of Scott Wilding because of a series of misdemeanor convictions involving drugs and a felony cocaine possession conviction, as well as a violation of the security laws. None of the convictions, however, involve moral turpitude, though he misdated, by a year (the meeting was in 2011 not 2010), his meeting with Miscovich and Tobia. 16. JTR alleges in its response, based upon an affidavit from Paul Sullivan, that Kim or Sean Fisher told him that “they would just say they were from the Atocha” with no proof of provenance or inspection. The undersigned participated in every call with Paul Sullivan and nothing of the sort was ever said and all of the communication between the undersigned and David Horan already filed with the Court [Doc. 123-1] refute such an allegation. The affidavit of Sean Fisher, who met with Jay Miscovich in June 2011, and refused to be a part of a proposed marketing plan for this huge discovery, also refutes Sullivan’s claim. [Exhibit 3 hereto.] 17. Finally, Silverstein goes to great length to illustrate the “reasonable” compromises that JTR offered Motivation if it would drop its claim. The reason that Motivation rejected the proposals was that, in each case, accepting the proposal would prevent Motivation from challenging JTR’s bona fides and revealing the truth to the court. 18. The foregoing sufficiently demonstrates a concerted bad faith effort in this litigation to warrant sanctions under the court’s inherent powers. The fight to avoid Motivation’s discovery requests was driven by JTR and counsel in order to prevent the Court from learning the truth of what it was being asked to adjudicate and, likewise to keep the truth from the public. Respectfully submitted. /s/ A. Eugene Lewis A. EUGENE LEWIS Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 10 of 11
Florida Bar Member 94810 /s/ Marlow V. White MARLOW V. WHITE Florida Bar Member 275417 LEWIS & WHITE, P.L.C. P.O. Box 1050 Tallahassee, Florida 32302 Vox: (850) 425-5000 Fax: (850) 425-5004 Email: lawlaw@polaris.net ATTORNEYS FOR CLAIMANT MOTIVATION, INC. CERTIFICATE OF SERVICE I HEREBY CERTIFY that on the date set forth on the banner appended to the top of each page of this document, I electronically filed the foregoing with the Clerk of the Court and, by virtue of the Clerk of the Court’s CM/ECF system, a copy will be electronically provided to all counsel of record. /s/ Marlow V. White Florida Bar Member 275417 Case 4:11-cv-10074-JLK Document 154 Entered on FLSD Docket 10/29/2012 Page 11 of 11
Case 4:11-cv-10074-JLK Document 154-1 Entered on FLSD Docket 10/29/2012 Page 1 of 1
STATE OF FLORIDA COLTNTY OF Indian River AFFIDAVIT OF BRENT BzuSBEN s. s. BEFORE ME, the undersigned authority, appeared Brent Brisben who, being personally well-known to me and having produced his Florida Driver's License as identification and having been duly sworn and under oath, solemnly declares under penalties of perjury: 1. My name is Brent Brisben. I am the Operations Manager and Member of 1715 Fleet - Queens Jewels, LLC, aHistoric Shipwreck Salvage company located at 23 North Beach Road, Jupiter Island, Florida, which owns the salvage rights in the Treasure Coast area that are adjudicated annually in the United States District Court for the Southern District of Florida, Case No. 79-8266-CIV-KING. 2. In the early summer of 2011, I was contacted by Peter Tobia who I had met on March 5,2011 during the 20ll East Coast Shipwreck Project Sub-Contractors Meeting in Sebastian, Florida,. Tobia called me and asked if we could meet in Sebastian. At the meeting, he told me that what he was about to tell me was "off the record" and that if I ever repeated what he was about to say, he would deny it. He then told me that he knew a doctor who had fallen on hard times but who had found a tremendous amount of emeralds in intemational waters; that while the doctor was diving, he picked-up a can and an emerald rolled out of it. He told me that in this same area he subsequently found thousands of emeralds. Mr. Tobia then showed me photos of piles of emeralds, which he said were taken on the countertop of his kitchen. He then asked me if I would give this un-named doctor a subcontract to work under my permits. I was very wary of the proposition, as the story did not make a lot of sense and informed him I did not want to be involved and would not issue them a subcontract to salavge. I have not had any contact with Mr. Tobia since that day. 3. I am aware of the litigation taking place in United States District Court in Key West that involves a great number of emeralds and a doctor who claimed to have found them. I have no interest in the outcome of the litigation. FURTHER THE AFFIANT SAYETH NAUGHT. IN WITNESS WHEREOF, I execute my signature on this 26th day of October ,20L2. SWORN TO AND SUBSCzuBED Before me on this 26th day of BRENT BRISBEN
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